The Guyanese Economy: booming in turbulent economic times

Generally, Caribbean countries, like numerous other developing countries in the world have for long seen turbulent economic times. Regardless, even amid severe economic constraints, both statistical as well as empirical data hints at the strength and modest growth of the Guyanese economy.

Empirical Evidence

While solid statistical data is often required to gauge the economic strength of a country, significant productivity is easily demonstrated in certain countries such as Guyana. In Guyana, the empirical data, people’s spending enthusiasm, commerce, etc is evident in and around the major towns and cities in the country. Towns linked to important economic activities such as mining or fledgling tourism are bustling with economic activity, lending to the obviously flourishing nature of the Guyanese economy.

Navito - The Guyanese Economy 1                     Image Credit: http://guyaneseonline.wordpress.com Guyanese Market

Solid Statistical Data

For the unconvinced more concrete indications are also available. In 2012, Guyana registered a GDP of $6.164 billion with 30% of its population below the poverty line and an employment rate of just 11%. The indicators are relatively good and proof of a growing economy.

Navito - The Guyanese Economy 5             Image Credit: ohguyana.blogspot.com

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A Model for the Caribbean

So what is at the core of Guyana’s success? What important policies have the Guyanese championed to ensure their current reality? Furthermore, how can the rest of the Caribbean adopt such policies in aid of seeing similar growth and development? Of course, there are numerous factors that have driven Guyana’s present outcome.

However, the principal contributing factor is that Guyana has adopted an old economic principle, one that dates back to the schemes of Adam Smith in his book The Wealth of Nations. In his book, Smith argues that capital is best employed for the production and distribution of wealth under conditions of governmental non-interference, or laissez-faire, and free trade. The Guyanese government has therefore taken the decision to let private initiative prosper, void of gubernatorial interference.

The major benefit of this free-trade principle adopted by Guyana is especially successful due to the fact that many private companies have taken interest in exploiting the untouched interior of the country. Investment in wild life, agriculture, eco-tourism and natural resources (extractive industries) lay testament to the success of this economic policy.

Navito - The Guyanese Economy3Image Credit: http://guyaneseonline.wordpress.com Tukatu Bridge, a major infrastructural development

While most Caribbean countries employ mixed economic policies, and give more power to the private sector; collaboration may just be the corrective measure that many Caribbean countries need. Of course, when considering economic changes, governments should always consider the impact of their policies with respect to their own unique economic conditions.

Issues to Consider

Amid the robust economic stage of Guyana, there lie numerous underlying social and political challenges being faced by the populace. To a great extent, there is much disquiet about the Chinese seeking to take advantage of resources in Guyana. Locals are timidly concerned about a rapid takeover of important economic resources by one group in the country; a situation that may not work out well for everyone.

Furthermore, amid the booming development and advancement lurks the other side of the story. Policies aimed at encouraging sustainable development and preserving important aspects of Guyanese heritage are apparently weak. Much of the developments being done in Guyana have dire impact on the natural and built environment. For example, Georgetown (Guyana’s capital), once known as the Caribbean’s ‘Garden City’ is rapidly losing its aesthetic appeal due to neglect. To this end, the government of Guyana needs to draft and implement comprehensive policies regarding environmental protective issues such as zoning and environmental rehabilitation.

As a final note, despite, the many good signs, Guyana’s further broad-based economic growth is limited by a number of structural and policy inadequacies. Efforts to improve the management of public finances have had little impact, and the large and inefficient public sector continues to be a drag on further private sector development.

Of course, Guyana enjoys a wealth of resources; this however does not take away from the fact that solid political and social policies have driven growth and development. Inclusive strategies, such as, engaging both the public and private sectors to drive collaborative development help to ensure that resources are distributed equally throughout the society, have taken priority. Today, Guyana stands as an economic model for the Caribbean especially in this era of austerity.

By: Norvan Martin

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