Delicately placed between Venezuela, Brazil and Suriname, Guyana is a remarkable country with a wonderful story. As the BBC states Guyana has a rich ecology. ‘Tropical rainforests – filled with distinctive plants and trees, teeming with exotic birds, insects and mammals – are a big draw for eco-tourists’ the BBC writes. However as they also contend, Guyana is also one of South America’s poorest countries.
Its Past and Its People
Similar to its Caribbean counterparts, Guyana has two primary political parties, who have both been very militant in their fight for power and influence since independence in 1966. Since then, its people, partly East Indian, black African, and a mixture of other ethnicities have overcome a number of social, national and economic hurdles in the building and development of their country and economy.
With the largest land area in the Caribbean, 196,849 km2 compared to Jamaica’s 10,831km2 or even Trinidad’s 5,128km2, Guyana has a huge opportunity for growth. Contrast that to the country’s small population of only 741,908 people (Jamaica has almost 4 times the amount of people, and Haiti 13 times), it’s low GDP of US$6,164 million, low growth and increasing debt burden (66.1% of GDP), you can quickly see why Guyana is described as ‘one of the poorest countries in the Western Hemisphere’.
The Currency and the Economy
Guyana’s exchange rate was liberalized in the 1990s, and the currency has been freely traded without restrictions since then; however it has continued to decline rapidly, according to Wikipedia. As it relates to their economy they write, ‘Agriculture and mining are Guyana's most important economic activities, with sugar, bauxite, rice, and gold accounting for 70–75 percent of export earnings. However, the rice sector experienced a decline in 2000, with export earnings down 27 percent through the third quarter 2000’.
Additionally, the country is still one of the hardest countries to do business in, ranking 114 out of 185 countries worldwide. One of their problems seems to be simply getting electricity for a new business, which is estimated to take 109 days, covering 7 steps and costing 542.9% of income per capita; and this is a month and a couple days more than the average for Latin America and the Caribbean!
The Present and the Possibilities
Like many Caribbean countries, Guyana faces multiplicity of problems. Aptly described by Wikipedia;
Guyana's extremely high debt burden to foreign creditors has meant limited availability of foreign exchange and reduced capacity to import necessary raw materials, spare parts, and equipment, thereby further reducing production. The increase in global fuel costs also contributed to the country's decline in production and growing trade deficit. The decline of production has increased unemployment.
Its currency, the Guyanese dollar, has been in use since 1839 and has taken on a life of its own even though its initial use was only to be temporary. Now trading at US$1: G$206.5 (as at April 11, 2013) based on the latest central bank data, the currency has declined by 8.3% or G$15.83 since 2002 and it continues to slide.
What of the future of the Guyanese economy, its local and international trade, and the Guyanese dollar? Thankfully, it has a thriving stock market, with market capitalization growing 11.1% up to Feb 2013 since December 2012; and this is after already growing by 38% as at December 2012 vs. the December 2011. This gives us hope. We also take hope in the wonderful, beautiful and resilient people, its untapped ecological opportunities and its proximity to many potential markets. Guyana with the right steps is poised for growth.
By TCC Staff