The increase in prices for commodities and services is a global phenomenon, and is not peculiar to Guyana.
Worldwide, the demand for goods and services has increased, but supply has contracted. What is rarely understood by all is the fact that world production of commodities is very much integrated, making the world more vulnerable to supply chain disruptions. Therefore, this means that parts may be produced in different countries, but the assembly of the final product may be done in an entirely different country. The pandemic has created issues at nearly every aspect of the supply chain: a lack of materials, ingredients, equipment, speedy trucking and shipping. There is an acute labour shortage of truckers and longshoremen to offload ships, thus creating a buildup, and there are shipping delays that have never been witnessed before. This effect of the disruptions of the supply chain has not only pushed costs up, but has created a decrease in supply, which again resulted in the prices of commodities spiralling.
Another factor is higher oil prices. This situation is beyond the control of any Government, but measures can be put in place to alleviate the climbing cost of living. This is exactly what the PPP/C Government has been doing for more than 16 months now.
Some progressive measures which have been put in place are outlined as follows:
There was a drastic reduction in the excise tax on fuel, which is in keeping with President Irfaan Ali’s commitment to “ensuring that Guyanese consumers continue to be protected from escalation in fuel prices on the world market as far as possible.” This reduction happened in February and October this year. This would have resulted in reduced transportation and production costs.
In its very first Budget, this Government did not give itself a salary increase, but gave immediate relief to the citizens. It reversed the punitive tax measures implemented by the APNU/AFC, and drastically cut licence fees. VAT was removed from many essential items, such as water, electricity, medical supplies and medicines, private education, cellphone data, farming machinery and equipment, etc. This is a Government which saw the collapse of the entire socio-economic fabric of this nation, and immediately began the Herculean task of reviving the economy. The Coalition had bankrupted the country in less than 5 years, and it became imperative that the rebuilding process begin immediately. This brought immediate relief, and ensured that more disposal income became available.
Next, the Government ensured that the disposal income was given a boost by direct cash injection, since the COVID-19 and the flood began wreaking havoc on the economy. It gave COVID-19 cash reliefs to every household. According to a study conducted by the World Bank, titled ‘An Uneven Recovery: Taking The Pulse Of Latin America And The Caribbean Following The Pandemic’, Guyana is one of the leading countries in the Caribbean and Latin America that have been assisting their people through the hardships associated with the COVID-19 pandemic. So far, the Government has disbursed to every Guyanese, including the vulnerable groups, cash reliefs amounted to nearly $10 billion. The World Bank noted that this assistance was pertinent, since many households suffer from food insecurity.
In addition, our students were given $3.6 billion to help them get back to school, and our farmers were given flood reliefs which amounted to $7.8 billion. Moreover, the year-end bonus given, the 2 weeks’ bonus to the disciplinary service, the $400 million to frontline workers, the 7% across-the-board increase to Public Servants, and I am sure that more cash relief is in the making.
We must not lose sight of the Government’s sacrifice to save the lives of Guyanese from the virus, and of the huge cost it bore to ensure not only that the Infectious Diseases Hospital is brought into operation, but the acquisition of vaccines and making them available to all in a timely and efficient manner.
As we take notice of the many investments which are taking place, and as we await these to bear dividends, we must applaud the Government, which has ensured that the multiplier effect from the many cash injections, which increased the disposable incomes of every Guyanese, has kept the economy buoyant and progressive. In these times of hardships across the world, this Government has done wonders for its people, and we must show our appreciation in a tangible manner.