Mid-year report shows confidence in economy – Finance Minister

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Following the presentation of the 2019 Mid-year report which shows a four per cent growth in the economy, Finance Minister Winston Jordan said the statements made by the private sector about a decline in business are unfounded.

“The Private Sector Commission has this habit of trotting out figures. I’ve had a number of meetings…at which they will make statements and it’s hardly tied by figures,” he told the media on Wednesday.

“There are irresponsible statements until you want to show me that your sales have declined,” the Minister said.

The Finance Minister said until persons can show the evidence in reports from the Bank of Guyana, International Monetary Fund (IMF) and the Economic Commission of Latin America and the Caribbean (ECLAC), they will remain statements.

The Minister said some businesses need to examine what is contributing to their decline to ensure it is not as a result of their own actions.

At a panel discussion held by the American Chamber of Commerce (AmCham) on August 5, Senior Counsel Ralph Ramkarran and former Attorney General Anil Nandlall said the business community is being stymied by the Government’s refusal to set a date for general and regional elections.

Additionally, President of the Corentyne Chamber of Commerce, Mohamed Rafeek had noted that “business gone down by 30-35 per cent in Berbice.”

However, Jordan alluded to the growth in private sector credit by 5.7 per cent – a total of $238.8B –as a result of investments from both businesses and households.

The report also shows an expansion of the manufacturing sector by 3.6 per cent due to a growth in rice and other manufacturing. Other manufacturing expanded by four per cent, on account of increased output of pharmaceuticals, beverages, edible items and timber products.

“You have no evidence of this slump… but you hear this figure being trotted out,” the Finance Minister said.

The services and construction sector expanded by 4.5 per cent driven by wholesale and retail trade, transportation and storage, financial and insurance activities, rental of dwellings, and other service activities.

According to the report, this is “the highest half-year rate since 2011.”

“There has also been increased borrowing for real estate of 5.7 per cent, which has contributed to an estimated 8.2 per cent growth in the construction sector over the same period,” it noted.

The mid-year report shows an expansion of the gold mining sector by 4.4 per cent. At the end of June 2019, 300,674 ounces of gold was produced. The industry benefited from a 15.8 per cent increase in declarations from small and medium scale miners, who accounted for more than 60 per cent of declarations.

The other mining subsector, which comprises diamond, sand and stone, is estimated to have contracted by 0.7 per cent in the first half of 2019.

The rice industry grew by 3.7 per cent due to improvements in both the number of hectares harvested and the yield and livestock by 8.1 per cent.

Meanwhile, bauxite contracted by 2.9 per cent as a result of sanctions faced by the Bauxite Company of Guyana Limited owned by RUSAL.

“This dispute lasted for more than a month and led to production falling by almost 25 per cent in the first quarter,” the report said.

The Sugar sector also fell short of its production target by one per cent with output reaching 33,531 metric tonnes as a result of the harvesting of cane.

It was noted that delays in the procurement of inputs, including fertilisers and spare parts, could affect production for the remainder of 2019, as well as 2020.

 

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