– Finance Minister
MINISTER of Finance Dr. Ashni Singh stated last Thursday that the newly rebased national accounts framework provides strong evidence of the emergence of, and dynamic growth in recent years, a number of new sectors of productive activity that did not exist at the time of the last rebasing.
In his feature address at Thursday’s workshop on the rebased national accounts, Minister Singh said it has long been recognised that the economy has undergone a dramatic transformation since the last rebasing was done in 1988. The new base year is 2006 in the recently launched new national accounts framework.
To illustrate how this transformation is reflected in the new framework, he pointed to the fact that the previous base-year of 1988 preceded all of the reforms implemented to liberalise the economy, and to reintroduce private enterprise in Guyana.
Minister Singh also stated that in 1988, the economy was dominated by a command-type structure with what was then described as the commanding heights of the economy falling under the ownership and control of the then Government. The Minister pointed out that various estimates have indicated that as much as 85 per cent of the economy was under government control at that time; that parallel market activities were also still rampant; and that private investment and private enterprise were virtually non-existent.
Minister Singh contrasted the structure of the economy at that time with the emergence of various sectors of productive activity in recent years as a result primarily of private investment. He cited a number of examples of sectors and industries that have emerged and grown dramatically in recent years, including service sectors such as information and communications technology, tourism and hospitality including restaurants, private transportation, and private education and health care services. He also gave examples of particular products and services that are now routinely available on a widespread basis in Guyana but which were not at all available twenty years ago. These include mobile telephony and the internet.
As a result, Minister Singh explained, the previous 1988 national accounts framework would have either not reflected at all or would have inadequately reflected activities in such sectors and industries. Having conducted the rebasing exercise to introduce the new base year of 2006, and the Statistics Bureau having conducted an up to date survey of business and economic activity, the national accounts would now include a more current, complete and comprehensive measure of economic activity in the country. This is reflected in the changing weights of the various sectors of activity in the computation of the gross domestic product, with the relative weight of traditional sectors declining and the weight of sectors which were previous regarded as non-traditional showing significant upward movement. This, Minister Singh stated, provided important vindication of the dramatic changes that have been taking place in the Guyanese economy in recent years.
The Minister explained that rebasing results in an expanded coverage of activities that were not previously being captured consistent with the latest international standard industrial clarification, it facilitates the use of better measurement tools consistent with the latest recommended international standards and the derivation of the current input costs profiles for enterprises and sectors which now provide a great advantage in determining the current value added estimates, capturing the productivity gains over time at enterprise and sectoral levels and importantly providing the hard data for the generation of sectoral GDP deflators which will allow an improved estimate of the GDP at constant prices and with it the sectoral and overall growth rates of the economy.
One of the immediate results of the rebasing exercise was an increase in the size of Guyana’s GDP estimates at market prices by an average of 62.2 percent for the period 2006 to 2009. For the year 2009, the estimate of GDP at market prices on the old base of 1988 which stood at G$255.8 billion now stands at G$413.1 billion under the new base, a 61.4 percent increase.
In congratulating the Chief Statistician and the staff of the Bureau of Statistics for the major accomplishment of completing this rebasing, Minister Singh also acknowledged the vast technical assistance, advice, and inputs received from regional and international institutions in support of the rebasing exercise. The Caribbean Regional Technical Assistance Centre (CARTAC) came in for special thanks by the Minister, along with the US Bureau of the Census and the US Bureau of Economic Analysis, the Inter-American Development Bank, and the Statistics Offices of other Caribbean countries, including Trinidad and Tobago where some of the Guyana Bureau’s staff received training to benefit from that country’s experiences with rebasing.
In thanking CARTAC, the Minister acknowledged the presence at the workshop of CARTAC Coordinator Mrs. Therese Turner Jones as a clear signal of the importance that CARTAC attached to the Guyana rebasing project. He also expressed appreciation to CARTAC for being with the Bureau’s National Accounts Staff from the first day of the rebasing exercise back in 2007, when the details of the National Economic Survey were being planned, and for being here today some two and a half years later when the results were being presented and explained.
The workshop featured technical presentations by staff of the Bureau of Statistics, CARTAC, and the Statistics Institute of Jamaica.