According to the International Monetary Fund (IMF) world growth is projected to fall to ½ percent in 2009, its lowest rate since World War II. Despite wide-ranging policy actions, financial strains remain acute, pulling down the real economy. A sustained economic recovery will not be possible until the financial sector’s functionality is restored and credit markets are unclogged. For this purpose, new policy initiatives are needed to produce credible loan loss recognition; sort financial companies according to their medium-run viability; and provide public support to viable institutions by injecting capital and carving out bad assets. Monetary and fiscal policies need to become even more supportive of aggregate demand and sustain this stance over the foreseeable future, while developing strategies to ensure long-term fiscal sustainability. Moreover, international cooperation will be critical in designing and implementing these policies.

The IMF further points out that global growth in 2009 is expected to fall to ½ percent when measured in terms of purchasing power parity and to turn negative when measured in terms of market exchange rates. This represents a downward revision of about 1¾ percentage point from the November 2008 WEO Update. Helped by continued efforts to ease credit strains as well as expansionary fiscal and monetary policies, the global economy is projected to experience a gradual recovery in 2010, with growth picking up to 3 percent. However, the outlook is highly uncertain, and the timing and pace of the recovery depend critically on strong policy actions.

Against this backdrop it is heartening to note that the World Bank has praised Guyana for its sound macroeconomic management for the past decade. This is a far cry from what our local “prophets of doom and venom” are belching out. One of them keeps harping on his nonsensical mantra of an elected dictatorship while others argue that the national economy is poorly managed and painting a gloomy picture.

Country Director for the Caribbean, Yvonne Tsikata said: “Guyana has made significant progress in laying the foundations for macroeconomic stability and higher pro-poor growth. The Country Assistance Strategy continues this partnership and supports the country in areas where the Bank’s support could strategically complement other donors’ areas of engagement.”

World Bank executives have also commended Guyana for its macroeconomic performance over the past decade and recognised the progress made in improving fiscal discipline.

In light of this, the Bank’s Board of Directors has approved the new Country Assistance Strategy (CAS) for Guyana for the period 2009 and 2012 in support of the country’s development agenda in the areas of improving education and social safety nets and strengthening its ability to mitigate the effects of natural disasters and climate change.

Country Director for the Caribbean, Yvonne Tsikata said: “Guyana has made significant progress in laying the foundations for macroeconomic stability and higher pro-poor growth. The Country Assistance Strategy continues this partnership and supports the country in areas where the Bank’s support could strategically complement other donors’ areas of engagement.”

Well this is a totally different picture from the one being painted by the “prophets of doom” who are doing so simply because of their deep seated hatred for the PPP/C government and the political axes they have to grind. Obviously in such a situation objectivity goes blank and this is the problem in Guyana-opponents of the government never see anything good happening in this country. The stand taken on the EPA by politicians outside of the government supporting the government’s position was indeed a magnanimous one but it resulted in one politician getting into trouble with his party and forcing him to resign as chairman.

However, the facts on the economy speak for themselves, contrary to what the “prophets of doom” may try to portray.

Finance Minister Dr. Ashni Singh addressing the recent CDB meeting disclosed: “despite the hostile external environment, the Guyanese economy achieved real growth of 3.1 percent in 2008, representing the third successive year of positive growth since the unprecedented floods of 2005. While the agriculture sector contracted by 5.8 percent overall, this result was largely driven by a 15.1 percent contraction in sugar output, which masked positive developments such as a 10.5 percent growth in rice production. The mining and quarrying sector also delivered a positive performance, led by gold production which grew by 9.7 percent as gold prices remained strong, offsetting the 6.7 contraction in bauxite output which resulted from the halving of the world market price for aluminium in the last five months of the year.”

He added: “despite the hostile external environment, the Guyanese economy achieved real growth of 3.1 percent in 2008, representing the third successive year of positive growth since the unprecedented floods of 2005. While the agriculture sector contracted by 5.8 percent overall, this result was largely driven by a 15.1 percent contraction in sugar output, which masked positive developments such as a 10.5 percent growth in rice production. The mining and quarrying sector also delivered a positive performance, led by gold production which grew by 9.7 percent as gold prices remained strong, offsetting the 6.7 contraction in bauxite output which resulted from the halving of the world market price for aluminium in the last five months of the year.”

So these facts and figures give the reassurance that the economy is in good hands and provide optimism for the future of our dear land.