The economic policy of the David Granger-led coalition Government is both misguided and misdirected, as it does not cater for addressing critical issues that need immediate attention. This is according to former presidential advisor and outspoken economist, Ramon Gaskin.
Gaskin told Guyana Times that while the training received from the World Bank and other international financial bodies was important and considered issues such as macro-economic stability, exchange rates and other key economic tools, emphasis was never placed on developing communities.
“We have to start looking at community-based economics to create jobs. Create industrial estates and jobs for people, especially those who are likely to be affected by the impending closure of the sugar industry,” the Russia-trained economist advised, stating that this could be done immediately.
Gaskin accused the Government of not placing enough focus on building communities. According to him, if the Government decides to invest in communities across the country, this could lead to greater economic activity and
Former presidential advisor and outspoken economist Ramon Gaskin
prosperity for the people that reside within them.
“The Minister does not focus on people and communities, and they have to turn their focus on that. What can they do for the people at Wales and Uitvlugt? They don’t look at those things and I think that is the big problem here with this economy in my opinion,” he opined.
Gaskin, who has remained critical about several policies of both the previous and present Governments, stressed that the Guyanese economy was in terrible shape and something needed to be done.
“It’s deteriorating. It’s not getting better. It’s on a downward trajectory, and I don’t see anything being done to arrest it and to turn around the curve,” he emphasised.
He pointed out that the formal economy has been in bad shape for some time now and things were heading in the wrong direction. “Sugar is in big trouble. Production is down and production is now around 147,000 tonnes. Guyana used to produce 364,000 tonnes in 1964,” he added.
Gaskin also pointed to the fact that rice production was also on the decline, as it has moved from about 687,000 tonnes in the last year of the previous Administration to a massive 25 per cent decline.
“The bright spot of the economy continues to be gold production and many of them being done by the Canadian companies and their production is shipped out even though you get royalties. On the other hand, local production is being smuggled,” he contended. The local economist said it appeared that the Government was waiting on the production of oil in 2020 to assist with bringing back economic growth and stability in the country.
“So, essentially what they are saying is you could bear strain until 2020 and you would be happy. I don’t believe that, of course. We don’t know what it will be like in 2020,” he said.
Shifting his attention back to the need for more community-based economics, Gaskin told Guyana Times that if the Government was so determined to close down the sugar industry, it should commence working to create alternative employment for those likely to be affected.
He said since there were already plans in the pipeline to send home some 10,000 sugar workers, the Government should find jobs for them. He argued that if the plan for sugar materialised, it could put a huge strain on the economy, given the enormous number of people employed within the industry.
The Private Sector Commission (PSC) has said that the restoration of Guyana’s economy was inevitably and intimately linked to the future of sugar. “It would be sad to lose the sugar industry and realise five years later that this would have been a success story,” the PSC had said in a statement in May.
Guyana’s economic fortunes in recent years have reflected the path of global commodity prices. Between 2005 and 2014, the economy grew by 4.7 per cent per year on average, ending a disappointing decade of alternating years of growth and contraction.
According to the World Bank, real Gross Domestic Product (GDP) growth decelerated to 3.1 per cent in 2015, as commodity prices collapsed for Guyana’s major exports. Preliminary estimates showed growth of 3.3 per cent in 2016.
Increased output from mining, agriculture, and fishing compensated for lower global prices and balanced out contractions in forestry and manufacturing.
It was reported that the economy was expected to grow by around 3.6 per cent over the 2017–19 period. Most of this growth is expected to come from continued growth of gold production and rebounding performance in other sectors.
The discovery of oil off Guyana’s coast holds the promise of increased revenue to finance the country’s development needs – but brings with it new challenges that will require careful management of economic, governance, and environmental risks.
