–records 25.5% increase, with notable rise in public, private infrastructural projects
–service sector follows closely, with positive results in each sub-sector

DRIVEN by a general increase in the number of public and private infrastructural projects, as well as rehabilitation works nationwide, the construction industry fared well in the first half of the year, recording an increase of 25.5 per cent.

It was widely reported that from the housing sector to the agriculture sector, there has been mobilisation of resources from both private and public sector stakeholders, who are laying the foundation to capitalise on the impending growth locally.

Private projects, as reported, range from the construction of hotels and apartment complexes, to shopping complexes and office buildings among other things.

In the public sector, aside from the construction of several low-income and young professional houses, there were upgrades to highways, main roads, and miscellaneous roads countrywide. This was also supplemented by the commencement of construction on new roads.

In addition to providing improved road facilities, the ongoing works have also added to the creation of thousands of jobs, bringing the Dr. Irfaan Ali-led administration closer to delivering on its promise to create at least 50,000 jobs within the next five years.

During this year alone, the government budgeted $172.4 billion for education, public infrastructure and healthcare. Of this sum, $58.2 billion worth of planned expenditure on public infrastructure is the second largest component of the government’s fiscal programme.

On the capital side, the budget for infrastructure is $32.9 billion, or 32 per cent of the total allocation for 2021.

Further, 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. A number of those projects are ongoing.

The performance in the construction sector was supplemented by growth of 9.4 per cent in the services sector, as recorded by the Bank of Guyana in its mid-year report.

Growth was recorded in all sub-sectors of services, with the most significant increases being in wholesale and retail trade and repairs, arts, entertainment and recreation, transport and storage, accommodation and food services, and professional and scientific and technical services.

The wholesale and retail trade and repairs industry experienced an expansion of 34.3 per cent. Overall, private consumption increased with imported goods (consumption and intermediate goods) rising during the review period.

The arts, entertainment and recreation industry experienced growth of 19.1 per cent, compared with a contraction of 45.8 per cent one year earlier. This performance is mainly on account of the growth and positive performance of the gaming industry.

Further, according to the Central Bank, the transport and storage industry recorded growth of 16.2 per cent, primarily on account of lifted restrictions on domestic and international air, land and sea travel that were put in place a year earlier to curb the spread of COVID-19.

“This follows the return to work by many after prolonged remote working arrangements, and general movement of persons for business and leisure. The accommodation and food services industry grew by 14.5 per cent,” the Bank of Guyana reported.

This outturn reflected a rise in the occupancy rates of hotels, as well as more on-site dining at restaurants, though at reduced capacity, as restrictions remain in place.

Noteworthy performances were also recorded in the service sectors of information and communication by 10.1 per cent; administrative and support services by 9.1 per cent; financial and insurance activities by 7.3 per cent; and other services by 6.9 per cent.

Overall, the Guyanese economy recorded positive growth during the first half of 2021 from heightened activities in almost all of the major sectors. Real-oil Gross Domestic Product (GDP) grew by 14.5 per cent, while non-oil GDP grew by 4.8 per cent.

The growth in the non-oil economy was supported by fiscal policies, the removal of restrictions, as well as accommodative monetary policies.

And even as the country continues to contend with the direct and indirect effects of COVID-19, the Bank of Guyana is optimistic that the high level of growth achieved in the first half of the year will be sustained in the second half.

“This outturn is expected on account of higher output of oil, coupled with improved performance in all other sectors, as the economy continues to rebound from the COVID-19 pandemic. Notwithstanding, the end-of-year inflation rate is expected to remain at a low single-digit level, as supply shortfalls following the May/June floods are reversed,” the Central Bank said.