…country’s gold, cash, public deposits ‘dry-up’
…national accounts now with billions in overdraft
With the recount of the ballots cast on March 2 completed, a new President is expected to be sworn in imminently after which there would be the appointment of a new Government and the convening of a new legislative body in order to, among other things, approve a National Budget of expenditure for the year.
The last budget approved by Guyana’s National Assembly was one for the fiscal year ending 2019 which means that all expenditure for the first half of 2020 has been curtailed to a monthly one-twelfth of the previous year’s expenditure.
No new spending was possible during the first half of this year, save for special circumstances as was with the advent of the coronavirus Task Force.
The new government, however, will soon find out that Guyana as a country is, as is used in Guyanese colloquial parlance, “broke.”
Not only has the country’s general reserves been depleted to $0, but the account is also now running an overdraft to the tune of hundreds of billions of dollars.
This is in addition to an alarmingly depleted gold reserve. The state of affairs can be gleaned from the published balance statements of the nation’s accounts held by the Bank of Guyana.
The Bank of Guyana, as part of its statutory requirements, published in the Official Gazette, a Statement of Assets and Liabilities for the country.
The state of play, as illustrated in the May 23 publication of the Official Gazette reveals that the General Reserve is -$290,667,332.
Additionally, Public Deposits have also depleted to below $0, also recording a negative balance of -$88,629,401,855.
Guyana’s Contingency Reserve account also reflects an alarmingly low among of $2.3 billion.
When APNU/AFC took office in May 2015, the Bank of Guyana’s Statement of Assets and Liabilities reflected a completely different situation.
According to the records, when the coalition A Partnership for National Unity/Alliance for Change took Office in 2015, Guyana’s gold reserves were stocked at $15 billion.
The latest figures show that the gold reserves have been depleted by the APNU/AFC administration to less $1 billion—now standing at $715 million.
This reflects a difference of $14.3 billion spent by the sitting Administration during its time in office, not accounting the additional sales for gold that would have cycled through the financial system over the course of the five years in office.
In 2015, Guyana’s General Reserve had in its coffers just about $6 billion while the Contingency reserve held $4 billion.
Today, those savings have been eroded to below zero dollars, to now reflect considerable overdrafts.
According to the May 2020 figures, the General Reserves now stand at minus $291 million while the Public Deposits now account for an $89 billion red mark or overdraft against the country.
While the contingency reserve stood at $4.8 billion when the APNU/AFC coalition took office, the current accounts reflect a balance of just about 2.3 billion.
