A developing economy can power economic growth while at the same time solve social and environmental challenges. But such an outcome requires an intelligent commitment at the highest level. That vision and primary responsibility rest with the Chief Executive Officer of the nation – the President, who uses the technical advice of his entire team. But the decisions are his alone.
Can we say that President Granger understands what is required to unleash the required investments needed to grow and diversify the economy to deliver on this so-called “GOOD LIFE”? I leave you the readers to come to your own conclusions on this question. I will, however, put some facts on the table to bring clarity to my positions on the issue. I am of the firm view that President Granger has underserved Guyana over the last three years and to compound such low-quality service, his continued absence from the hot seat will bring greater harm to the nation, rather than good.
That is why I am reiterating the call that it would be best for Guyana if President Granger focuses 100 per cent of his time on his health today and give others within his party the chance to rise to the top and take charge of the task at hand. And to prove my point, let us focus on the money issues since Granger arrived.
Can we say that the fiscal policy framework was strengthened to safeguard the nation’s finance, enhance its competitiveness and promoted growth for all since May 2015?
Firstly, in November 2018, the national debt finally surpass the US$2 billion mark again. The last time Guyana surpassed that US$2 billion mark was when the then People’s National Congress (PNC) Government bequeathed the incoming Jagan
Government such a gift in 1992. It took many years of hard work and the repayment of almost a billion US dollars along with some debt write-off before debt sustainability returned in 2007.
It is clear that whichever party wins the 2020 elections, they are sure to receive the same old PNC gift of US$2 billion plus in debt. As the table below reveals, public debt will be at 57.1 per cent of GDP at the end of 2018, a material increase from 50.1 per cent at the end of 2015. Over the three years from the end of 2015, this Granger Government would have borrowed US$441 million, which translates to GY$8.7 million of immediate debt in 2018 as a newborn child open their eyes.
Secondly if we look at the credit to the Private Sector which is a good indicator of the investment appetite within the business community, we can see that since 2015 it has been declining and is expected to close 2018 at 35.6 per cent of GDP compared to 39.3 per cent at the end of 2015, a decrease of 3.7 per cent. This situation is due to a combination of weak demand for new investments and GO-Invest’s poor performance at facilitating business deals.
Thirdly, Guyana is struggling to fiscally consolidate its books because of the rapacious appetite of this PNC-led Government. This Government can spend like wild boys on a drunken rampage as if there is no tomorrow. And their empty excuse remains that the oil review will pay of the accelerated spending currently financed mainly by debt. Sorry, the wrong answer, it will not!
These wild spending spree by this PNC-led Government does not offer any decent value for money in exchange for proper planned national development. At the end of 2018, the fiscal deficit is expected to be 4.9 per cent of GDP compared to 1.4 per cent in 2015. In layman’s language, a fiscal deficit is the annual amount the Government has to borrow to fund gaps in their annual spending. This mean that 4.9 per cent of the economy is being borrowed to spend on many projects that does not offer value for money such as the G$350 million that is being spent on Mash 2019.
Guyana will be borrowing an equivalent of US$149 million from the domestic market in 2018 and they are prepared to plunder every Tom, Dick, and Beharry to pay for these debts. This Granger Government has borrowed from GPL, the Bank of Guyana (over G$50 billion), the local banks and if the laws permits, I would not be surprised if they make a move on the worker’s pension funds.
I am of the firm view that President David Granger cannot deliver the good life. Not today; not tomorrow; not ever.
