…emphasises need for broadening of economic base

WITH Guyana’s growth rate for this year pegged at 3.4 per cent, precisely .4 per cent below the budgeted 3.8 per cent, Finance Minister Winston Jordan has acknowledged that the country needs to strengthen its institutions, and broaden its economic base.
He made it clear that such a move is necessary for Guyana to build a resilient economy capable of withstanding both external and domestic shocks. “We are in various stages of preparation of pieces of legislation, which are aimed at guiding the management of oil revenues for the benefit of present and future generations,” the Guyanese minister told the gathering at the 48th Annual Meeting of the Board of Governors of the Caribbean Development Bank (CDB) held in Grenada.
He said Guyana’s robust performance is expected to continue into the medium-term, with anticipated oil production early 2020 contributing to a dramatic increase in the country’s Gross Domestic Product (GDP). He told finance ministers of the region, along with officials of the CDB, that the country’s outlook for 2018 “is very positive” despite further declines in the sugar industry.
This year, however, growth is expected to stand at 3.4 per cent with increased outputs in the rice, construction, manufacturing and services sectors. Last year, Guyana’s economy recorded a growth rate of 2.1 per cent, reflecting improved performances in the forestry and rice sectors. However, contractions were witnessed in the sugar, construction and mining sectors. “We continue to strengthen public financial management, with significant improvements recorded in both revenue administration and the capital expenditure implementation ratio. Further, we emphasised stimulating private sector activity in more structured ways, especially in light of the emergence of the oil-and-gas sector with its transformational potential and developmental impact on the economy,” Jordan said at the recently-concluded meeting.

GLOBAL OUTPUT
The finance minister pointed to the International Monetary Fund (IMF)’s statement that global output grew by 3.7 per cent in 2017, and is expected to increase to 3.9 per cent this year, with growth being more broad-based. He opined that the upward trajectory as projected by the IMF “brings renewed hope for developing economies of the Caribbean”, of which many are still recovering from the effects of last year’s hurricane damage, high debt burdens, and declining living standards.
“Therefore, the time is opportune for such economies to implement structural and other reforms to anchor the recovery efforts, and to secure regional resilience and prosperity,” Jordan stated while highlighting Guyana’s financial posture.
He disclosed that Guyana has recently adopted a Public-Private-Partnerships (PPPs) Framework, which provides a structured platform for the local and external private sector to meaningfully engage the government in achieving the national development agenda.
“The formulation of the PPP Framework for Guyana is as a result of my government’s proactive stance about obtaining value for every dollar invested, especially in the public sector investment programme (PSIP),” said Jordan, who noted, too, that as Guyana rapidly approaches oil-producer status and stands to benefit from massive inflows of new resources, the inclusiveness of all stakeholders in national development becomes a pressing imperative. The Guyanese finance minister suggested that it is time that the region begins to seriously consider the concepts of “building resilience” and “building back better”, in light of the catastrophic events which have affected the growth of small-island economies.
“We must objectively dissect our failures, including our less than robust systems; our poorly designed and built infrastructure that continues to collapse in the face of adversity; and our people who seem unprepared in face of the onslaught of Mother Nature.”
He continued: “We must develop focussed and sensible counter-strategies; we must continue to forge partnerships and synergies, and create stronger systems and governance structures to be better equipped to confront severe disasters.” In this vein, he applauded the CDB’s efforts in mobilising resources to assist hurricane-ravaged islands, while also lauding the Bank’s move to “ramp up” Technical Assistance Grants and other financing for improving institutional capacity, and strengthening systems for disaster risk reduction in the Region.
Jordan said Guyana has been able to tap into support from the Bank to mix its resources with those of the United Kingdom/Caribbean Infrastructure Fund (UKCIF). Through the UKCIF/CDB co-financing arrangement, Guyana has been able to expand the financial envelope to US$139M. This money will be used to realise waterfront renewal in Georgetown; upgrade the first phase of the much anticipated Linden to Lethem Highway; and construct a bridge across the Essequibo River at Kurupukari.
These projects, the finance minister disclosed, will be the impetus for the development of the country’s water transport systems and linking the more developed coastal regions to the hinterland regions of Guyana. “We look forward with much optimism to their realisation,” he stated.
Additionally, Jordan noted that almost a year ago, the agreement for the 9th Cycle of the Basic Needs Trust Fund (BNTF) Programme was entered into. That agreement will see an estimated US$6.145M being spent on projects and activities that contribute to inclusive and sustainable economic growth. “This is an overarching goal of both my government and the Bank. The suite of interventions is intended to reduce poverty in poor and rural communities; improve access to critically-needed services; and enhance the quality of life in remote and interior areas of Guyana,” the Finance Minister concluded.

BUILDING PARTNERSHIP
Meanwhile, Jordan said there is a growing need for the Caribbean Development Bank (CDB) and member states to partner to maximize the impact of development resources geared at improving the livelihoods of the Region’s people.
Finance Minister Winston Jordan in a recent address at the 48th Annual Meeting of the Board of Governors of the Caribbean Development Bank (CDB) held in Grenada, stressed that with continued challenges of accessing concessional resources in the Region, it is becoming increasingly important for the Bank and Member States to partner.
“We must, collaboratively, seek ways and means to ensure increased productivity of public spending in our Member Countries. Whilst Guyana salutes the steps taken by the Bank to improve portfolio performance throughout the Region, including extensive training in Public Policy Analysis and Project Cycle Management, a microscopic examination into the regional dilemma of poor project implementation needs to be undertaken, with a view to laying out robust mechanisms towards improving project delivery,” Jordan said.

He also called for more “out of the box” thinking if the Bank is to maintain its commendable credit rating. “All options need to be explored on ways to maintain this rating, including a careful study on the impact and implications of expanding the Bank’s membership,” he said while reaffirming Guyana’s resolve to deepen cooperation with the Bank and member countries.