HEAD of the Presidential Secretariat, Dr. Roger Luncheon, announced yesterday that Cabinet lauded Minister of Finance, Dr. Ashni
Singh, for his presentation of the national budget on Monday, saying that it showed evidence of a well-managed economy. “It was Cabinet’s conviction that Dr. Singh’s presentation was superb, particularly his construction and his presentation of the
budget, and he was duly commended for that effort,” he said.
He spoke during a post-Cabinet press conference at the Office of the President.
The HPS added that no one could possibly fail to see the grand design of the PPP/C administration for Guyana and for Guyanese in 2011
and in the future. “The evidence of a well-managed economy was paraded by the minister, surrounding the achievements of macro-
economic stability, all in the face of the yet unresolved international financial and economic uncertainty,” he said.
“Cabinet insisted that the evidence was a reflection of the confidence reposed by Guyanese stakeholders in the administration and its
ability to manage, as well as its policies. Cabinet enthused about the declared measures in the budget and the implications of those
were a reflection of the continuation of well-received interventions introduced during earlier budgets,” he said.
He noted that Cabinet members recognised the unmistakable evidence of pride and commitment to national development and undertook to
aggressively implement the outlined 2011 plans of action in their respective sectors.
Dr. Singh on Monday unveiled a national budget totalling $161.4 billion, 13.1 percent higher than the 2010 budget. He also projected
that the country will grow by 4.6 percent, with the non-sugar economy growing by 2.8 percent. The budget is themed ‘Together –
Building Tomorrow’s Guyana – Today’, and is financed without the introduction of new taxes.
The inflation rate is targeted at 4.4 percent this year, while the overall fiscal balance of the central government as a percentage
of GDP is expected to remain level at 3 percent.
Corporation tax has been re-adjusted downwards. As for commercial companies that paid corporation tax at the rate of 45 percent of
chargeable profits, such companies shall, with effect from year of income 2011, pay corporation tax at a rate of 40 percent of
chargeable profits, except for telephone companies, which shall continue to pay corporation tax at the rate of 45 percent.
The rate of corporation tax for non-commercial companies has also been adjusted downward. Such companies will now be required to pay
at the rate of 30 percent of chargeable profits, down from 35 percent. This would allow those companies to retain and reinvest a
significantly higher share of their profits.
The minister also announced readjustments for the income tax threshold from $35,000 a month to $40,000 a month, public assistance
from $4,900 per month to $5,500 per month, and old age pensions from $6,600 per month to $7,500 per month.
The budget said for 2010, the economy achieved a growth rate of 3.6 percent, the fifth consecutive year of growth, and that the
expansion of output achieved in recent years has relied less on the traditional sectors and increasingly on new and emerging sectors
of the economy. The non-sugar economy grew by 4.3 percent in 2010; and at the end of 2010, the country achieved a balance of payments
surplus of US$90.1M. Because of this, the Bank of Guyana increased its external reserves position to US$780M at the end of 2010,
exceeding the previous year’s level of reserves, the minister announced.
Export earnings expanded by 16.1 percent to US$891.9M, reflecting both volume and price increases in the case of most commodities.
Foreign direct investment increased by 20.7 percent to US$198M. The rate of inflation for last year was 4.5 percent, the minister
announced, noting that government continued to apply concessional tax rates on fuel products.
Interest rates continued to trend downwards, reducing the cost of borrowing to businesses. The weighted average lending rate declined
by 22 basis points to 11.95 percent, while the small savings rate declined somewhat more moderately, by 12 basis points to 2.67
percent. The 91-day Treasury bill rate declined by 40 basis points to 3.78 percent, the budget announced.