Developed in conjunction with the World Bank and the International Monetary Fund (IMF), the ERP significantly reduced the government's role in the economy, encouraged foreign investment, enabled the government to clear all its arrears on loan repayments to foreign governments and the multilateral banks, and brought about the sale of 15 of the 41 government-owned (parastatal) businesses. The telephone company and assets in the timber, rice, and fishing industries also were privatized. International corporations were hired to manage the huge state sugar company, GUYSUCO, and the largest state bauxite mine. An American company was allowed to open a bauxite mine, and two Canadian companies were permitted to develop the largest open-pit gold mine in Latin America. However, efforts to privatize the two state-owned bauxite mining companies, Berbice Mining Company and Linden Mining Company have so far been unsuccessful.
Most price controls were removed, the laws affecting mining and oil exploration were improved, and an investment policy receptive to foreign investment was announced. Tax reforms designed to promote exports and agricultural production in the private sector were enacted.
Agriculture and mining are Guyana's most important economic activities, with sugar, bauxite, rice, and gold accounting for 70%-75% of export earnings. However, the rice sector experienced a decline in 2000, with export earnings down 27% through the third quarter 2000. Ocean shrimp exports, which were heavily impacted by a 1-month import ban to the United States in 1999, accounted for only 3.5% of total export earnings that year. Shrimp exports rebounded in 2000, representing 11% of export earnings through the third quarter 2000. Other exports include timber, diamonds, garments, rum, and pharmaceuticals. The value of these other exports is increasing.
Since 1986, Guyana has received its entire wheat supply from the United States on concessional terms under a PL 480 Food for Peace program. It is now supplied on a grant basis. The Guyanese currency generated by the sale of the wheat is used for purposes agreed upon by the U.S. and Guyana Governments. As with many developing countries, Guyana is heavily indebted. Reduction of the debt burden has been one of the present administration's top priorities. In 1999, through the Paris Club "Lyons terms" and the Heavily Indebted Poor Countries (HIPC) initiative Guyana managed to negotiate $256 million in debt forgiveness.
In qualifying for HIPC assistance, for the first time, Guyana became eligible for a reduction of its multilateral debt. About half of Guyana's debt is owed to the multilateral development banks and 20% to its neighbor Trinidad and Tobago, which until 1986 was its principal supplier of petroleum products. Almost all debt to the U.S. Government has been forgiven. In late 1999, net international reserves were at $123.2 million, down from $254 million in 1994. However, net international reserves had rebounded to $174.1 million by January 2001.
Guyana's extremely high debt burden to foreign creditors has meant limited availability of foreign exchange and reduced capacity to import necessary raw materials, spare parts, and equipment, thereby further reducing production. The increase in global fuel costs also contributed to the country?s decline in production and growing trade deficit. The decline of production has increased unemployment. Although no reliable statistics exist, combined unemployment and underemployment are estimated at about 30%.
Emigration, principally to the U.S. and Canada, remains substantial. Net emigration in 1998 was estimated to be about 1.4% of the population, and in 1999, this figure totaled 1.2%. After years of a state-dominated economy, the mechanisms for private investment, domestic or foreign, are still evolving. The shift from a state-controlled economy to a primarily free market system began under Desmond Hoyte and continued under PPP/CIVIC governments. The current PPP/C administration recognizes the need for foreign investment to create jobs, enhance technical capabilities, and generate goods for export.
The foreign exchange market was fully liberalized in 1991, and currency is now freely traded without restriction. The rate is subject to change on a daily basis, but the Guyana dollar has depreciated 17.6% from 1998 to 2000 and may depreciate further pending the stability of the post-election period.
GDP: purchasing power parity - $1.86 billion (1999 est.)
GDP - real growth rate: 1.8% (1999 est.)
GDP - per capita: purchasing power parity - $2,500 (1999 est.)
GDP - composition by sector:
agriculture:
34.7%
industry:
32.5%
services:
32.8% (1998 est.)
Population below poverty line: NA%
Household income or consumption by percentage share:
lowest 10%:
NA%
highest 10%:
NA%
Inflation rate (consumer prices): 5.5% (1999 est.)
Labor force: 245,492 (1992)
Labor force - by occupation: agriculture NA%, industry NA%, services NA%
Unemployment rate: 12% (1992 est.)
Budget:
revenues:
$220.1 million
expenditures:
$286.4 million, including capital expenditures of $86.6 million (1998)
Industries: bauxite, sugar, rice milling, timber, fishing (shrimp), textiles, gold mining
Industrial production growth rate: 7.1% (1997 est.)
Electricity - production: 325 million kWh (1998)
Electricity - production by source:
fossil fuel:
98.46%
hydro:
1.54%
nuclear:
0%
other:
0% (1998)
Electricity - consumption: 302 million kWh (1998)
Electricity - exports: 0 kWh (1998)
Electricity - imports: 0 kWh (1998)
Agriculture - products: sugar, rice, wheat, vegetable oils; beef, pork, poultry, dairy products; forest and fishery potential not exploited
Exports: $574 million (f.o.b., 1999 est.)
Exports - commodities: sugar, gold, bauxite/alumina, rice, shrimp, molasses, rum, timber
Exports - partners: US 25%, Canada 24%, UK 19%, Netherlands Antilles 11%, Jamaica 5% (1998)
Imports: $620 million (c.i.f., 1999 est.)
Imports - commodities: manufactures, machinery, petroleum, food
Imports - partners: US 28%, Trinidad and Tobago 21%, Netherlands Antilles 14%, UK 7%, Japan 5% (1998)
Debt - external: $1.4 billion (1998)
Economic aid - recipient: $84 million (1995), Heavily Indebted Poor Country Initiative (HIPC) $253 million (1997)
Currency: 1 Guyanese dollar (G$) = 100 cents
Exchange rates: Guyanese dollars (G$) per US$1 - 180.4 (December 1999), 178.0 (1999), 150.5 (1998), 142.4 (1997), 140.4 (1996), 142.0 (1995)
Fiscal year: calendar year