Guyana’s GDP grew by 36.4% for 1st half of 2022

…non-oil economic growth was 8.3 per cent

The mid-year report released by the Finance Ministry shows that Guyana’s real Gross Domestic Product (GDP) grew by 36.4 per cent for the first half of 2022, on the back of growth in a number of economic sectors such as the agricultural and mining sectors.

According to the report, in addition to Guyana’s GDP growth, non-oil economic growth was 8.3 per cent. This, according to the Finance Ministry, reflects the Government’s supportive policy. In addition, the outlook for the rest of the year will continue to be favourable.
“For the full year, real GDP growth in 2022 is now projected at 56 per cent overall, and non-oil GDP growth at 9.6 per cent, maintaining Guyana’s position of global leader in economic growth,” the Ministry of Finance said.
The report noted that the agriculture, forestry and fishing sectors are estimated to have expanded by 10.9 per cent in the first six months of 2022. These figures were driven by higher production from the other crops, forestry and livestock, in spite of weaker performances in the sugar, rice and fishing industries. The sector is now expected to grow by 11.9 per cent.
With respect to mining and quarrying sectors, these are estimated to have grown by 64.6 per cent in the first half of the year, with a revised 2022 forecast of 99.9 per cent driven by growth in the petroleum and other mining industries.
“The petroleum sector expanded by an estimated 73.5 per cent, with 34.6 million barrels of oil produced in the first half of the year. This was the result of the commencement of oil production at the <<<Liza Unity>>> FPSO in February.”
“Also on the upside, the bauxite industry is estimated to have grown by 31.9 per cent, and the other mining and quarrying (sand, stone, diamonds, manganese) industries by 36.3 per cent, in the first half of 2022,” the Ministry said.
According to the report, the manufacturing sector is estimated to have contracted by 11.4 per cent in the first half of the year. The manufacturing sector is now projected to grow by 7.5 per cent for 2022.
The service industries are meanwhile estimated to have expanded by 7.6 per cent, driven largely by increases in wholesale and retail trade, and transport and storage. The overall 2022 growth rate for the services sector is now forecast to be 6.3 per cent.
“The construction sector is estimated to have grown by a strong 20.4 per cent in the first half of 2022, reflecting intensified activity in both the public and private sector,” the Ministry also explained.

Fiscal policies
Senior Minister with responsibility for Finance within the Office of the President, Dr Ashni Singh, was quoted as saying that the continued growth projected for 2022 builds on the 4.6 per cent growth recorded last year. He also attributed this to the Government’s fiscal policies.
“Led by President Ali and fuelled by the rapid economic growth, we have embarked on a period of rapid transformation, and our Government has laid out a masterplan for the rapid development and transformation of Guyana.”
“More importantly, we have demonstrated the capacity and commitment to working assiduously to make this vision a reality so that benefits can redound to citizens in the shortest possible time,” Dr Singh also indicated.
Dr Singh noted that upon the assumption to office by the President Irfaan Ali-led Government, the Administration recognised the importance of a strong, diversified economic base. As such, even in the early days of oil production, the administration placed the highest level of importance on a resilient non-oil economy.
The aim, according to the Finance Minister, was to modernise the economy’s traditional economic pillars and usher in a rapidly growing and highly competitive non-oil economy. This, he noted, is evident in the nation’s non-oil economic growth at the end of the first half.
While the economy has grown and is projected to keep growing, so too is inflation… in light of the fallout from the Russian invasion of Ukraine, which has exacerbated disruptions in the supply chain and has resulted in global surges in food prices.
“Guyana has not been spared. Consumer prices were 4.9 per cent higher than levels recorded at the end of 2021 and this was due largely to higher food and energy prices… Given the existing geopolitical tensions globally, inflation is now projected to be 5.8 per cent for 2022,” the Ministry said.
The mid-year report also recounted the various measures the Government adopted, such as reducing the excise tax on petroleum from 20 per cent to 10 per cent at the time of Budget 2022 presentation. This was reduced even further from 10 per cent to 0 in March.
“Additionally, Government also utilised $1 billion for the purchase and distribution of fertiliser to farmers across the country, $800 million to provide cash grants to households in hinterland and riverine communities, among a number of other interventions,” the Ministry explained. (G3)