–as sector edges closer to becoming economic powerhouse
WITH an accelerated housing programme, massive highways, and community roads to be developed, Guyana’s quarrying industry will no longer be able to take a backseat among the productive sectors, but rather be efficiently exploited for local consumption and progressive projects.
According to the Institute of Quarrying, this activity involves the process of removing rock, sand, gravel or other minerals from the ground in order to use them to produce materials for construction or other purposes. So, a quarry is any such work on the surface of the earth where minerals are extracted. Quarries are also known by other names around the world, such as: ‘Surface mine’, ‘pit’, ‘open pit’ or ‘opencast mine’. The Institute says that materials produced by quarrying are essential to everyday life, providing the construction materials to build roads and buildings, delivering vital minerals to agriculture, and supporting the generation of electricity among other things.
In Guyana, the government is expending close to $172.4 billion, or 45 per cent of its $383.1 billion budget on education, public infrastructure, and healthcare. And, based on an analysis of the country’s budget, a sum of $58.2 billion of planned expenditure on public infrastructure is the second largest component of the government’s fiscal programme.
Simply put, this, supplemented by projects undertaken by the private sector, will increase the demand for construction and other materials derived from quarrying.
In fact, President Dr. Irfaan Ali, has said that the extraordinary demand from the “construction boom” has resulted in the importation of an estimated 40 per cent of construction materials, at an approximate value of US$10 million. While an increase in economic activities is always good, the pitfall in this regard is that such a large amount of the commodities had to be imported, when, in fact, they can be produced locally. “We can produce this locally,” President Ali said during a press conference at State House on Wednesday.
POTENTIAL FOR ADVANCEMENT
In speaking about the potential for advancement in the quarrying industry, the President said: “Guyana has a huge quarry potential that has been greatly underdeveloped. Our accelerated housing programme, massive highways and community roads to be developed will increase our demands three-fold over the next five years.”
In order to maximise local benefits, create jobs, and expand local content through this industry, the government is in the process of issuing new quarrying licences so as to fully satisfy local demand. Last year, the mining and quarrying sector is estimated to have expanded by 303.7 per cent, and, based on available statistics, this sector is projected 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 2020.
Reports are that the magnitude of potential growth is no surprise, as the incumbent People’s Progressive Party/Civic (PPP/C) government had said, from the onset, that it will not be working in isolation, but will be moving swiftly towards achieving its development agenda.
Evidently, the government intends on staying true to its word, as there are clear plans in place to enhance the infrastructural landscape of the country.
Minister within the Ministry of Public Works, Mr. Deodat Indar has said that the current budget for infrastructure represents $32.9 billion or 32 per cent of the total capital expenditure for the country for 2021. The country’s aggregate capital expenditure for this year is $103 billion.
This investment, according to the Georgetown Chamber of Commerce and Industry (GCCI) in its message following the announcement of Budget 2021, provides the financial grounding for the buildout of the country’s infrastructure, and the basis for re-starting economic growth, which would have been hindered by a protracted electoral process, and the pervasive COVID-19 pandemic. The government’s total budget for road programmes is $23.7 billion, $7.9 billion of which will go specifically towards the development of community roads. Of the budgeted sum, $2.1 billion has been set aside for hinterland roads, and the rehabilitation of a number of hinterland airstrips.
In moving forward, construction, the sector with one of the highest multiplier effects in the economy, is anticipated to provide employment and spinoff effects to catalyse economic growth.
“You have to prepare for the new economy. The economy before you is an expanding oil-and-gas sector, and we will need infrastructure onshore to move goods, people and services more efficiently and cheaper,” Minister Indar said during a recent interview. It has been reported also that Guyana’s economy will remain resilient against the effects of the dreaded novel coronavirus (COVID-19) pandemic, maintaining its positive growth trajectory as the burgeoning petroleum sector ‘picks up steam’.
Based on the latest estimates from the World Bank, the Gross Domestic Product (GDP) of the Latin American and Caribbean Region will be 2.6 per cent lower at the end of 2021 than it was at the end of 2019.
The international financial institution, in its semi-annual report on the region, said Guyana’s growth rate will remain in the double digits.
Guyana grew at an extraordinary rate of 43.5 per cent in 2020, having completed a year of oil production. The positive spillover effects were, however, dampened by a deep contraction in the non-oil economy, triggered by measures to contain the COVID-19 pandemic.
Despite the lingering adversities, projections remain positive, with the country set to record an economic growth of 20.9 per cent at the end of 2021, and another 26.0 per cent in 2022, and again 23.0 per cent in 2023.
The country’s GDP of about $6.8 billion is expected to more than double by 2025, reaching over $14 billion.