— with expansion expected in agriculture, mining, other key sectors

RESILIENCE has been the hallmark of the local economy, as it has withstood the direct and indirect effects of the novel coronavirus (COVID-19) pandemic and the protracted March 2, 2020 General and Regional Elections, to record real Gross Domestic Product (GDP) growth of 43.5 per cent at the end of last year and still remain on course to grow another 20.9 per cent this year.
Guided by the Government’s proposed $383.1 billion Budget 2021, themed “a path to recovery, economic dynamism and resilience,” the economy will continue to navigate the pervasive pandemic and, at the same time, recover through prudent management of the productive sectors and the general economy.
Budget 2021 is Guyana’s largest budget ever, and it is financed with no new taxes. It is $53.5 billion larger than Budget 2020 and $46 billion higher than the Central Government’s total expenditure for 2020.

Senior Minister in the Office of the President with responsibility for finance, Dr. Ashni Singh, in presenting the proposed budget to the National Assembly on Friday, said Guyana’s real GDP is projected to grow by 20.9 per cent, with the non-oil economy growing by 6.1 per cent, a significant reversal of the 7.3 per cent contraction in 2020.
“This is premised on the assumption that a reopening of the economy takes place with COVID-19 restrictions being gradually lifted and is, therefore, subject to significant downside risks,” Dr. Singh said during his almost five-hour long presentation.
Members of the National Assembly, with the exception of the Opposition Parliamentarians who omitted themselves from the sitting, were told that the country’s economic progress, in addition to being premised on a re-opened economy, will be driven by expansions in various key sectors.

In 2021, the agriculture, forestry and fishing sectors are expected to expand by 5.6 per cent, driven by growth across all sub-sectors.
According to Dr. Singh, the restructuring of Guyana Sugar Corporation (GuySuCo), alongside the recapitalisation of sugar estates, will see improved production and productivity, not only in 2021, but over the medium term. As a result, in 2021, the sugar industry alone is projected to grow by 9.6 per cent.
Additionally, with new high yielding varieties, the rice growing industry is forecast to expand by 3.5 per cent in 2021.
The forestry, livestock, other crops and fishing industries are also expected to see improvements in 2021. These industries are projected to expand by 18.5 per cent, five per cent, five per cent, and 11.1 per cent respectively, driven by higher demand, and incentives provided for in Budget 2020.
Similar results are expected in the mining and quarrying sector, which is forecast to grow by 39.1 per cent in 2021, driven by growth across all industries, namely oil, gold, bauxite, and other mining and quarrying. In the oil and gas sub-sector, Dr. Singh said, the daily rate of production for 2021 is expected to be just over 109,000 barrels of oil per day. This sub-sector is projected to grow by 46.7 per cent in 2021.

RESUMPTION
The gold mining sub-sector, which also suffered some setbacks in 2020, is expected to grow by 4.2 per cent in 2021, largely due to the resumption of operations at the one large-scale gold mine which had suffered a stoppage in 2020.
Also, in the area of mining, the bauxite sub-sector, which faced major interruptions in 2020, is expected to recover in 2021, and grow by 18.4 per cent. Similarly, the ‘other’ mining and quarrying sub-sector, which saw a significant contraction in 2020 as a result of lower demand, is projected to recover, and grow by 19.8 per cent in 2021, particularly with the anticipated scaling up of construction activities resulting in significant increases in the production of sand and stone.
Growth in the extractive sector will be supplemented by the anticipated performance of the manufacturing sector, which is projected to improve by 7.3 per cent in 2021, on account of anticipated growth in sugar, rice, and other manufacturing.

“With the resumption and expansion of public sector construction through the Public Sector Investment Programme (PSIP), alongside growth in private sector investment in key infrastructural projects, a 9.1 per cent growth rate is projected for this sector in 2021,” Dr. Singh said.
The services sector, supported by the reopening of the economy, is projected to record significant improvements in 2021. An overall growth rate of five per cent is projected for this sector.
“This is largely driven by anticipated expansions in wholesale and retail trade, transportation and storage, and financial and insurance activities, which are projected to grow by 10 per cent, 9.9 per cent and 7 per cent, respectively,” Dr. Singh explained.
The anticipated recovery and growth of the economy were expected initially in 2020, but the Government recognised very quickly that infection levels were significantly higher than reported by the previous APNU+AFC administration, reflecting the low level of testing.
“As a result, this administration was forced to keep in place several emergency measures for much longer than anticipated, hampering the pace of recovery expected at that time,” Dr. Singh said.

He went on to say: “Indeed, it has become evident that the shocks to our economy from the events of 2020 – both the pandemic and the protracted general and regional elections – were far more severe and far more lasting than we anticipated. As a result, our real Gross Domestic Product (GDP) in 2020 is estimated to have grown by 43.5 per cent, somewhat lower than previously expected. More strikingly, the non-oil economy is estimated to have contracted by 7.3 per cent.”
Despite what would have occurred last year, President, Dr. Irfaan Ali has said already that Guyana is on course to prosperity, with a diverse economy which is yet to reach its peak.
“Our economic prospects have never been brighter. Our collective feet are firmly placed on the first rungs of a ladder to prosperity that is clearly within our sight,” President, Dr. Irfaan Ali, said during his address to the nation on January 1, 2021.
The year 2021, according to the President, will be the springboard from which Guyana will leap into recovery, rebuilding the economy, enhancing the people’s health and lifting up the vulnerable groups in society. “We must not remain a rich country of poor people,” the President affirmed, noting that the bounty of Guyana must be shared across the population.