–as economic environment improves, local investments increase

IMPROVEMENT in Guyana’s economic environment has significantly benefited Republic Bank Guyana Limited, which has recorded an after-tax profit of $1.8 billion at the close of the first half of the financial year in March.
Chairman of the bank’s Board of Directors, Nigel Baptiste, said that the profit recorded by the bank reflects an increase of $173 million or 10 per cent, when compared with the corresponding period last year.
“[This is] primarily as a result of improvement in Guyana’s economic environment as recovery from the COVID-19 pandemic continued and investments in the country’s oil and gas sector gathered pace,” Baptiste said in the bank’s unaudited half-year financial report.
In addition to its profits, the bank’s assets grew by $23 billion or 10.5 per cent and customers’ deposits grew by $22 billion or 11.5 per cent year on year.
As a result of this improved performance, an interim dividend of $1.40 per stock unit, 40 per cent more than the interim dividend of $1.00 per stock unit was paid last year, was approved.
“As we enter the second half of the fiscal year, the bank remains optimistic that economic developments and successful execution of projects in key sectors will serve as catalysts for further improvement,” Baptiste said.
It was reported that Guyana’s economy, driven by increased production, its burgeoning oil and gas sector and projected improvements in the performances of traditional mining and construction, is on course to growing by 47.5 per cent and 7.7 per cent in the non-oil economy in 2022.
This economic performance will follow growth rates of 19.9 per cent and 4.6 per cent recorded at the end of 2021, despite the persistence of COVID-19, as well as the impact of floods. With this rate of overall growth, Guyana is likely to be amongst the fastest-growing economies worldwide in 2021.
“The very creditable performance of the non-oil productive sector reflects the delicate and dynamic policy balance struck between aggressive containment of COVID-19 on the one hand and phased reopening of the economy on the other hand,” Senior Minister in the Office of the President with responsibility for Finance, Dr. Ashni Singh, had said during his presentation of Budget 2022, in February.
He also credited the performance in 2021 to prompt and proactive flood-mitigation measures, which helped limit the fallout in the agricultural sector and supported the sector in resuming activity in the shortest possible time.
Additionally, the service sector recorded extraordinarily strong performances in response to a policy framework that has stimulated historic levels of demand for services and facilitated a commensurate response on the supply side.
Based on Budget 2022, the government intends to maintain and even enhance its approach to stimulating growth in various economic sectors.
Moving ahead, growth this year would be primarily driven by ExxonMobil’s second floating production storage and offloading (FPSO) vessel, the Liza Unity.
Outside of oil, non-oil growth this year is expected to be driven mainly by rebounds in rice- growing and gold mining, and continued expansion in construction activity and wholesale and retail trade and repairs.