Dear Editor,
In a recent letter (SN, August 18), I wrote that Guyana’s population “is not expected to increase significantly by 2050” and that a “Preliminary Report of the 2012 national population census found that Guyana’s population fell by 3,339 between September 2002 and September 2015, falling from 751,223 to 747,884”. The 2015 United Nations report on population projects (medium variant) that the country’s population will reach “806,000 in 2050, which represents a doubling from 1950.” I noted that “This rosy projection seems unlikely.” Dr Baytoram Ramharack, apparently uneasy with any projection, argues that Guyana’s favourable demographics bode well for the country: “Making projections keeps us in the realm of theorizing about the future. However, Guyana’s demographics create some windows of opportunities for the future” (GT, Sept 2).
He noted that fifty per cent of Guyana’s population is below the age of 25. This combined with four factors, he said, would apparently open up opportunities for growth. These factors are a low population density; a low agricultural density; the absence of social and environmental problems associated with large populations; and encouraging “pro-creation.” In addition, Guyana can draw upon the enormous talent in the diaspora. On the surface, these are powerful arguments, but one needs to drill down further to discover how vacuous most of them are.
To begin with, “theorizing about the future” is part of how the human brain functions and is an inescapable feature of human nature. Without the ability to think up likely future scenarios, humans would probably not have survived this long. And if we did, we would be no better off than animals.
Dr Ramharack is correct that Guyana’ s population is relatively young – half is below age 25. But a huge literature demonstrates that it is not population below age 25 or the size of a population per se that is crucial to economic growth. If this were so, countries such as India, Bangladesh, Indonesia and Pakistan, should be growing at robust and sustained rates. But they are not. Instead, age-structure is a major driver (but only one) of economic growth; specifically a large proportion of working-age population (WAP, 15-64 years). Countries such as China, Japan, Korea and Thailand achieved their highest rates of growth when their WAP peaked somewhere between 65 and 70 per cent of total population.
The bulge in WAP is known as the demographic window, which presents countries with an opportunity to realize a demographic dividend (ie, rapid and sustained socioeconomic gains arising from changes in population age structure). But the demographic dividend is not automatic; it requires supportive policies and conditions for its realization as the East Asian Tiger economies have demonstrated. These policies include investment in education, good governance and sound institutions, nutrition and health, empowerment of women, and prudent macroeconomic and labour policies. Creating the necessary take-off conditions for the expansion of human capabilities are preconditions for converting the demographic opportunity to sustained high growth rates (a demographic dividend).
In 1950, WAP comprised only 56 per cent of Guyana’s population, increased to 66 per cent in 2015, and is projected to peak at 72 per cent in 2055. Thereafter it will decline to 67 per cent in 2090. Guyana’s demographic window thus extends for more than seven decades, significantly longer than the three to five decades for many countries in Asia. Migration, if it continues at the recent unsustainably high rate, will probably constrict the demographic window. But while the demographic opportunity exists in Guyana, the necessary conditions and polices are not in place. Most likely, this absence explains the lacklustre growth performance of just over 4 per cent per year from 2008 to 2014. What is worse, trend growth rate is negative.
On the issue of a low population density, Dr Ramharack writes: “there is a potential for the development of untapped resources once the appropriate infrastructural designs are in place to ‘open up’ the country.” But herein lies the problem: the infrastructure to expand productive capacity requires significantly more investment per unit of output in Guyana than in many other developing countries. The main reason for this lies in the topography of the land, especially the coastal areas where the bulk of agricultural activities are located. But poor construction, poorer maintenance, and corruption depreciate physical capital – roads, drainage and irrigation canals, bridges, sea defences, machinery, etc – faster than normal. This leads to the important issue of the extremely low return to capital in Guyana, as demonstrated by the gross incremental capital-output ratio, which ranges from very high negative to low positive values. Similarly, the marginal efficiency of capital ranges from low negative to low positive values.
A low agricultural density, which Dr Ramharack defines as the ratio of farmers to arable land, has little, if anything to do with population size or its age structure. It is, if anything, an indication of the high degree of mechanization, which is in fact the case in Guyana (especially the agricultural sector). In the 1950s, for example, it required 20 days of labour per acre of paddy (from land preparation to harvesting and transporting to a mill or depot), which fell to about 10 days in the early 1980s. Today, the labour requirement is about 2 days per acre, which is only 10 per cent of what it was in the 1950s. Agricultural density in numerous countries is lower than Guyana, including Trinidad, Jamaica, the US, Canada and European countries. In the case of Guyana, the low agricultural density is a loud message that people are not going into agriculture, that agriculture is highly mechanized, and that the average age of the farmer is rising. The latter has been known since the 1970s.
Opening up the country – by which Dr Ramharack probably means a business-friendly environment to attract foreign capital – is much easier said than done. To begin with, the infrastructure required for this is far beyond the means of Guyana, in addition to the fact of a low return to capital invested and the risk of investing in Guyana. But we concur on one point: there is enormous skill and talent in the diaspora and expatriate Guyanese would willingly go back and serve for short periods if the conditions were sufficiently attractive.
In sum, ivory-tower analyses must be contextualized by what obtains in practice and that is where the ‘devil’ must be confronted squarely. Once the ‘devil’ is seen, one quickly comes to realize that the demographic window of opportunity and ‘potential’ – which is not vastly different from ‘theorizing’ ‒ are not sufficiently powerful to override Guyana’s dim developmental prospects.
Yours faithfully,
Ramesh Gampat
