Dr Clive Thomas

This week I shall consider the impacts of the global financial and economic crisis on remittance flows to Guyana and the wider Caricom region.

Introduction Last week’s column concluded the treatment of Guyana’s new National Accounts series and resumed the discussion on the impacts of the global crisis on the economies of Guyana and the wider Caricom region.

Introduction The recent rebasing of Guyana’s National Accounts series from 1988 prices to 2006 prices has created three major areas of difficulty for a comprehensive evaluation of Guyana’s macroeconomic performance during the 1990s and 2000s.

Last Sunday’s column focused on two key results following on the rebasing of the national accounts calculations from the 1988 base year previously in use, to the 2006 base year. 

As indicated in last week’s column I had planned to continue this week with a discussion of the rebased national accounts series for Guyana.

Last Sunday’s column ended with a brief description of how a typical balance of payments statement for an economy like Guyana’s might be constructed. 

Role of official external financing As a rule, small relatively poor open economies that are highly dependent on the production and export sale of low-value added primary products and/or other natural resources-based products that are not presently enjoying a secular boom in world commodities markets, end up in a situation where debt-led and capital inflows-led processes become the key drivers of economic growth. 

Terms of trade  In last week’s column I had observed that, because of lags in their publication, timely trade data are perhaps the weakest of all the published economic series on Guyana’s economy.

Structural trade dependence The point of departure for evaluating the effects of the on-going global economic crisis on Guyana’s economy should be rooted in the reality that, by global standards, Guyana is structurally far too small, too poor and too open to withstand severe external economic shocks; particularly when these shocks emanate from economies with which we have the strongest trade, financial, and investment ties and are considered the worst since the Great Depression of the 1930s.

Introduction At the end of last week’s column I introduced a list, which is not exhaustive, of the main channels through which the negative impacts of the global economic crisis have been transmitted to the economies of Guyana and the wider Caricom region. 

Objective achieved It would be reasonable for readers to conclude that, despite withering criticisms directed at it, stress-testing of banks in the United States and the European Union (EU) has achieved its principal objective, which is restoring a large measure of public confidence in their respective banking systems.

PR exercise Last week I pointed out that official US stress-testing of its biggest banks seemed to have ‘worked’ because a large measure of confidence has been restored in the banking system.

Introduction For most persons as time passes their memories fade, albeit to varying degrees.

Introduction Although routinely portrayed as the ‘provision of climate aid to poor rainforest countries,’ all the agreements I have seen between rich countries and poor rainforest ones, including the Guyana-Norway Agreement, are in essence the export sale of global environmental services by the latter in exchange for climate payments from the former.

Introduction I had indicated in last week’s column that I would treat with three particular aspects of global climate funding (aid) as I wrap up for now, my analysis of the LCDS, the Guyana – Norway Agreement and associated arrangements, as well as several environmental topics related to global warming and climate change.

In Retrospect Eight months ago, on November 29, 2009 and the eve of the Copenhagen Climate Summit (COP15) I began in this column what I projected then would be an extended series of analyses and commentary on the LCDS; the Agreement between the Government of the Cooperative Republic of Guyana and the Government of the Kingdom of Norway; the accompanying Memorandum of Understanding (MOU) and Joint Concept Note; and, related matters pertaining to the problems created by global warming and climate change.

Introduction This week I shall conclude my discussion of the global carbon market and the hopes many place on it for helping to provide a solution to the problems of global warming and climate change.

Introduction On reflection, several readers have communicated to me over the past few weeks, in different ways, the grave difficulty they were having in trying to fathom the interconnections between the global carbon market, the LCDS, and the resolution of the global climate problem.

Introduction Despite its relative infancy, the global carbon market is plagued with a virtual deluge of corrupt and illegal transactions.

A widely shared view among operatives on the global climate exchanges as well as most governments of rich countries is that, from a global perspective, forest carbon capture by poor rainforest countries constitutes ‘low-hanging fruit’ available for cheap harvesting through market-based efforts to combat global warming and climate change.