Manufacturing, services, and construction sectors ‘boom’

THE manufacturing, services and construction sectors in Guyana have experienced significant growth due to the expansion of the oil and gas industry during the country’s economic boom.

The Ministry of Finance’s mid-year report estimates a 17.7 per cent growth in the manufacturing sector for the first half of the year. Improved performance across all subcategories is the main reason.

The manufacturing sector is witnessing a smooth progression and reaching new heights, as compared to the 11.4% contraction in June 2022.

The Ministry of Finance said: “Sugar, rice, and other manufacturing grew by 30.1 per cent, 1.3 per cent, and 24.6 per cent, respectively. Notably, growth in the other manufacturing subsector can be largely attributed to an increase in the manufacturing of wood products, fabricated metal products, non-metallic products, paints, and plastic products, driven by the expansion in the construction and the oil and gas subsectors.

Adding: “These categories grew by 71.5 per cent, 55.8 percent, 23.2 per cent, 16.5 per cent, and 6.6 per cent, respectively.”

Furthermore, the growth surge didn’t stop there, as the manufacturing of beverages expanded by 14.2 per cent in the first half of the year.

“With upward revisions to the outlook for rice and other manufacturing, the overall manufacturing sector is now projected to grow by 7.8 percent this year,” the Ministry related.

Meanwhile, the services sector is estimated to have grown by 9.1 per cent in the first half of 2023.

This performance is mainly derived from the growth in the administrative and support services and wholesale and retail trade and repairs. These subsectors grew by 16.1 per cent and 14.2 per cent, respectively.

Additionally, because of the rapid expansion within the sector, the Ministry of Finance said: “The expansion in the administration and support services subsector was driven by an increase in the demand for security services, activities of call centres, and business support service activities.”

Also, in wholesale and retail trade and repairs, its growth was a result of the increase in the demand for building materials.

Moreover, the construction sector is estimated to have expanded by 44.1 per cent in the first half of 2023.

“Momentum in this sector continues to be driven by a ramp up of activity in both the public and private sectors. Government’s Public Sector Investment Programme (PSIP) grew from $258.1 billion at the end of last year, to a budget of $387.8 billion this year,” the mid-year report revealed.

It was said that this expansion has resulted in the commencement and continuation of infrastructural projects across the country, coupled with other substantial undertakings of the private sector.

“Given the first half performance, and ramped up activity expected in the second half, the sector is now forecasted to grow by 26.9 per cent this year,” the Ministry said.

PROGRESS

Earlier this month, President Dr. Irfaan Ali revealed that the nation’s real Gross Domestic Product (GDP) grew by an estimated 59.5 per cent, in the first half of 2023 while the non-oil economy grew by 12.3 per cent.

During a press conference, he said: “We are not a country pursuing a future of oil and gas. We are a country pursuing a balanced, holistic [and] diversified portfolio that will see sustainability and resilience of our economy, our country and our people,” adding that this positive trajectory is a result of the enormous injections being pumped into the non-oil economy.

“…This is as a direct result of the policy matrix of the government in the country,” the President firmly stated.

Sectors that were left to decay under the previous coalition government have been revived and reignited, according to the President, and are contributing largely to the expansion of Guyana’s economy.