Date Posted: November 21, 2008.
(Georgetown, GINA,) - Despite recession in the developed
world, Guyana has been spared the ravages that other
countries have encountered and will end the year with a
positive growth rate of about three percent which is
slightly below the projected rate.
This is according to President Bharrat Jagdeo during an
interview today at his State House residence with the
National Communications Network (NCN).The President said
that Guyana’s economy has not experienced any significant
decline although he anticipates that it will be affected in
the future by lower remittances, less demand for Guyana’s
products and less inflow of investment and tourism flows.
He said although in this country it may not be a large
financial sum it can affect the entire region. “Although
these issues may be solved by stimulus packages when you
have a fiscal deficit that is already large, the fiscal
deficit would expand further and probably be inflationary,”
the Head of State said.
The President believes these issues have to be ‘thought
out’ and a set of consistent policies has to be developed to
analyze how the global prices will impact on the local
economy before an appropriate strategy could be implemented.
“I think we need to bring the sectors together; I have
already been having discussion with the private sector, with
different groups of people and the government will look at
trying to balance between two forces, that is, trying to
spend more to stimulate demands, but in a labour intensive
way, whilst at the same time by spending more we can drive
up inflation because the demand for foreign currency would
be higher and stuff like that. We have experienced some down
turn in inflationary trends in the world now particularly we
have to be cognizant of building a government policy both
fiscal and monetary around those two variables of
stimulating some demand through greater employment and
spending in a different way” President said.
The President said that Guyana’s financial and insurance
sectors and pension fund investments have been reviewed, and
despite some minor issues the overall system is secure.
According to the Head of State, a lot of the companies
are repatriating to Guyana because people now recognize that
they could lose their capital, so across the Caribbean many
people are now repatriating funds even if they have to have
a lower rate of return of investment on their capital.
There is no fear of any major collapse in any of these
sectors because they are not very integrated into the
world’s financial market, the President said
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