Guyana: Recovering its ‘Lost’ Years

In “Guyana: Recovering its ‘Lost’ Years,” Sir Ronald Sanders writes about the economic lag of Guyana in comparison to the rest of the Caribbean. He writes, “Until recently, the economy of Guyana has been the sick man of the Caribbean falling second only to Haiti as the poorest country in the region.” Here are excerpts from his article:

May 26th marked 45 years since Guyana became independent.  During that time other countries, such as Malaysia, Singapore and the Maldives, [which] had been far behind Guyana in development, have surpassed it.  So, while this sprawling country, larger than England and rich in natural resources, marked its 45th year as an independent nation better economically than it was a decade ago, it should have been much better developed and far more prosperous than it now is.

But, much has been achieved economically in the last decade prompted by the forgiveness of Guyana’s debt under the Highly Indebted Poor Countries programme which allowed the government to secure loans for spending on infrastructure and some betterment of wages and pensions. It also allowed the government to improve the climate for investment through a reformed tax strategy.  

[. . .] Few would dispute that the two decades between 1976 and 1996 were ‘lost’ years for Guyana – a period when, despite its vast natural resources, the country experienced high debt, collapse of social and physical infrastructure and large-scale migration of its best educated people.  The economic decline came in the wake of the nationalisation in the 1970’s of much of the productive sector of the country – the sugar, bauxite and banking industries – for which it was punished by the industrialised nations and the institutions such as the IMF which they controlled. [. . .] At independence Guyana was hardly one nation.  It was more two societies coexisting with no appetite to return to past racial disturbances. But, it would be untrue to say that, at the time, the country, as a whole, had overcome its racial divide in fulfilment of its national motto, “One people, One nation, One destiny”.  

Twenty years ago, Guyana depended almost entirely on export earnings from sugar, rice and bauxite. Today, while these three commodities remain important, the agricultural sector has been diversified and Guyana is now a net exporter of agricultural products.  Its other resources, especially gold, will catapult the country’s economic growth in the future. Last year the country earned US$346.4 million from gold, almost three times the sum it earned from bauxite (US$114.6 m), sugar (US$104 m) and rice (US$154.6 m).  The country’s gold sector is set for “catalytic investment” on an unprecedented scale that will earn the country as much as US$1 trillion while introducing new technology that conforms to the high environmental standards that Guyana has set as part of its policy to employ a low carbon development strategy.  Manganese will also once again contribute to the economy. And then there is oil which, given all the positive studies, will eventually flow.

A few weeks ago, Guyana received US$40 million from Norway as payment for 8 million tonnes of carbon saved by preserving millions of acres of Guyana’s huge forests. President Jagdeo has indicated that the country “can expect to receive in excess of a quarter of a billion dollars in similar transactions before 2015”. Managed efficiently, these revenues could transform Guyana and allow it to recover from the ‘lost’ years – but they must also be distributed fairly and equitably through transparent machinery. Broad-based political parties in government and the legislature would be essential to that process. 

[The opinions expressed in this commentary are solely those of Sir Ronald Sanders. Sir Ronald Sanders is a Consultant and former Caribbean diplomat.]

For full article, see http://www.caribbean360.com/index.php/opinion/442117.html?utm_source=Caribbean360+Newsletters&utm_campaign=48680612a1-Vol_6_Issue_060_News5_27_2011&utm_medium=email#axzz1NaSoR2Dk

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