At a press conference at State House yesterday, President Irfaan Ali disclosed that Guyana’s real Gross Domestic Product (GDP) grew mid-year by an estimated 59.5% while its non-oil economy rose by 12.3% during the first half of 2023.
“We are not a country pursuing a future of oil and gas. We are a country pursuing a balanced, holistic, diversified portfolio that would see sustainability and resilience of our economy, our country and our people and that is the context through which the investment in Guyana and the different sectors are taking place.
“As a result of this wide approach, this holistic approach, real GDP grew by an estimated 59.5%, in the first half of 2023. Important to note is that the non-oil economy grew by 12.3% in the first half of this year,” he added.
The president, reading from the mid-year report for 2023, announced that the agriculture, forestry and fishing sectors, expanded by an estimated 7.6% in the first half of this year when compared to the first half of 2022, while the sugar industry grew by 30.1%.
The Guyana Sugar Corporation (GuySuCo) produced 17,034 tonnes of sugar in the first crop of this year, compared with 13,089 tonnes during the same period in 2022, on account of improved weather conditions and yields, however the growth projection for the sector remains unchanged at 29.3% for 2023.
The decline in fish production can be attributed to reduced fishing activities amid the growing presence of sargassum in Guyana’s territorial waters, coupled with one major operator not working for an extended period at the beginning of the year. On the upside, the report said that improved shrimp catches were due to more favourable climatic conditions, combined with better performance in the locations within which the fishers operated. In the second half of the year, the outlook for both marine fish and shrimp production was positive, with an expected recovery in marine fish production. As such, the growth rate for the subsector in 2023 has been maintained at 8.4%.
Aquaculture production grew 33.7 per cent in the first half of the year, driven largely by an expansion in brackish water shrimp production, supported by government’s investment in the sector. With respect to marine production, fish output contracted by 8.7 per cent when compared with the first half of 2022, while shrimp production grew by 49.5 per cent to reach 9,351 tonnes in the first half of this year.
Rice industry
The rice industry in the first half of this year when compared to 2022, grew by an estimated 3.2%, consequent to continuous investment in drainage irrigation, fiscal incentives, the increase in the use of technology, the expansion of research and development, and opening up of new lands according to the Head of State.
Ali reported that the livestock industry has grown by an estimated 9.4% in the first half of this year which he ascribed to his government’s successful policies. “At the end of the day, results are what matters, and this is a clear demonstration as to how the model, the development model that we are using is producing that result”, he contended.
The forestry industry witnessed a 4.5% growth during the first half of the year.
Mining and quarrying, showed an overall growth in the first half of this year, followed by an anticipated growth of 98.4% in the petroleum sub sector.
“On the other hand, the mining and quarrying industry, when we came into government quarrying was virtually dead. The production was at an all-time low, even when compared to 2015. We have been able to bring the necessary measures and fiscal incentives to stimulate the sector to the extent that in the first half of this year, other mining and quarrying grew by 45.2%”, he asserted.
Services and manufacturing sector
The manufacturing sector grew by 17.7%, driven largely by increases in the manufacturing of wood products, fabricated metal products, non-metallic products, paints and plastic products. According to the Head of State, these categories enable persons to understand that growth is not only at the macro level, but also at the household and community level, driven by Guyana’s robust housing programme. The services sector is estimated to have grown by 9.1 per cent in the first half of the year, driven largely by growth in administrative and support services and wholesale and retail trade and repairs.
These subsectors grew by 16.1 per cent and 14.2 per cent, respectively. The expansion in the administration and support services subsector was driven by an increase in the demand for security services, activities of call centres, and business support service activities. In wholesale and retail trade and repairs, growth was driven by an increase in the demand for building materials. Further, another notable increase in the first half of the year is that of information and communication, which grew by 19.8 per cent over the first half of 2022. This was driven by an increase in the provision of mobile and internet services, including the launch of a new mobile service in May of this year. Growth for the services sector has been upgraded to 7.8 per cent in 2023.
The construction sector has grown substantially in the first half of this year by 44.1% and according to Ali when looking at monetary developments, it will be seen that credit to the private sector grew by 5% and this growth is expected to further advance in the second half of this year. Moreover, according to the mid-year report published by the Ministry of Finance yesterday, credit to business enterprises in the services and manufacturing sectors grew by 3.3% and 8.9% respectively.
Inflation
At the end of June 2023, the consumer price index declined by 0.3 percent, when compared with a 4.9 percent increase observed at the end of the first six months of last year. This contraction reflects some reversion in the spikes observed last year, and can be attributed to lower food and energy prices, the report said. More specifically, declines were observed across multiple food categories, largely vegetables and vegetable products, and meat, fish and eggs, which fell by 6.9 per cent, and 1.1 per cent, respectively.
The 12-month inflation rate in June 2023 was 1.9 per cent, lower than the 5 per cent recorded in June 2022. This lower rate was mainly due to lower food prices, which accounted for 2.2 percentage points of the 12-month inflation rate, while the transport and communication category contributed -0.3 of a percentage point, supported by lower energy prices. Within the food category, meat, fish, and eggs contributed 1.2 percentage points, while vegetables and vegetable products contracted, accounting for -0.2 of a percentage point.
Noteworthy, the June 2023 12-month inflation rate is in line with pre-pandemic levels. In June 2019, for example, the 12-month rate was 2.4 per cent.
