ECONOMY
In 2007, the real gross domestic product (GDP) of the Guyanese economy increased by 5.4%, exceeding expectations. Strong growth in the sugar, fishery, livestock, mining, and manufacturing sectors contributed to the economy's performance.
Agriculture
The agricultural sector (including sugar processing and rice milling) recorded a real 0.7% increase during 2007. The growth partly reflected stable weather conditions and large investment in drainage and irrigation facilities. In addition, the government has undertaken initiatives, with U.S. Government support, to increase production in the nontraditional agriculture sector.
Fishing and Livestock
The fishing sector grew 44.3% in real terms in 2007 due to increases of 6.7% and 96.1% in fish and shrimp catches, respectively. The launching of the Fisheries Management Plan, the recertification of Guyanese fish by the U.S., and the construction of an aquaculture hatchery contributed to this increase. Despite these improvements, the fishing sector continues to be plagued by piracy and increasing machine and fuel costs. In 2007, the livestock sector grew 2% in real terms, largely due to the re-entry of a major livestock producer into the industry, the establishment of additional pastures, and government assistance in controlling pests and diseases.
Forestry
Logging and plywood output decreased in 2007 by 16.1% and 1.2%, respectively. The decrease in logging is largely attributed to the suspension of logging permits as a result of environmental concerns, and increases in freight and insurance costs. In contrast, the production of sawn-wood increased by 10.1%.
Mining
The mining sector grew 22.7% in real terms during 2007. This reflected the substantial investment and restructuring in the bauxite industry in recent years and increased world prices for bauxite and gold.
Manufacturing
The manufacturing sector (excluding sugar processing and rice milling) grew by 1% in 2007. High global prices for inputs adversely affected growth.
Construction
The construction sector grew 5.7% in 2007. Private investment in hotel construction and housing and a 2.2% increase in public sector investment in schools, roads, low-cost housing, and drainage and irrigation contributed to growth.
Services
The service sector increased 7% in 2007. The transport and communications sub-sectors grew by 13%, helped by heightened competition in the telecommunications sector as new cell phone and Internet providers entered the market.
Inflation
The Consumer Price Index (CPI) rose by 14% in 2007, a significant increase from the 4.2% inflation experienced in 2006. This was associated with implementation of a value-added tax (VAT) at the beginning of 2007, rising global food and commodity prices, and increased fuel costs.
Exchange Rate
The exchange rate remains stable; the Guyana dollar currently trades at G$200/U.S.$1.
Merchandise Trade
The trade deficit rose 27.3% to U.S. $381.7 million. The U.S $177.6 million increase in imports more than offset the U.S. $95.7 million increase in export earnings.
Exports
Total export receipts in 2007 amounted to U.S. $680.9 million, 16.4% higher than 2006. This increase was a result of higher world prices of sugar, rice, and gold as well as increased volumes exported. Sugar export earnings increased by 9.6% to U.S. $150.1 million, while the volume of sugar exported increased by 3.1% to 246,013 tons. Rice exports earned U.S. $75.3 million, an increase of 37.8% over 2006 due largely to higher volumes exported. Receipts from gold exports were U.S. $153.1 million, 33.7% higher than the 2006 level due to an increase in export volume and a significant rise in global precious metal prices. The value of timber exports was U.S. $55.4 million, 0.7% below 2006, following new restrictions on log exports. The value of other timber (excluding plywood) exports increased by 2.1% to U.S. $47.6 million, while the value of plywood exports decreased by 6.9%. Total earnings from all other exports were U.S. $145.5 million, 8.2% less than the previous year. Guyana's primary export markets are the U.S. (18.8%), Canada (18.4%), the U.K. (8.7%), Portugal (6.5%), Trinidad and Tobago (4.9%), Netherlands (4.3%), Belgium (4.3%), and Jamaica (4.1%).
Imports
The value of merchandise imports grew by 20.1% to U.S. $1.06 billion in 2007. The increase reflected activities associated with hosting the Cricket World Cup in 2007 and higher fuel costs. Higher imports of furnishings for the hotel and hospitality industry grew to U.S. $62.1 million from U.S. $29.4 million in 2006. Imports of building and transport machinery, largely for public sector capital projects, grew 44.7% and 49.1%, respectively. Guyana's primary import sources are Trinidad and Tobago (23%), the U.S. (21.3%), China (9.7%), Cuba (6.3%), and the U.K. (4.5%).
Total Investment
Total 2007 investment rose by 4.9% to U.S. $434.0 million, due to increased public sector investment and a modestly improved investment climate in Guyana. Public investment accounted for slightly less than half of total investment. This increase reflected the government's aim to maintain infrastructure needed for sustained growth and development, such as roads, bridges, sea defense, drainage and irrigation, and schools. The government also allocated funds for improvement in agriculture, housing and water, and national security. Private investment, spurred by government incentives, increased by 8.5% to U.S. $222.5 million. Major investments include mining, construction, transport and communications, and distribution sectors. Foreign direct investment from the U.S. accounted for approximately U.S. $24.5 million, or 1.1%, of private investment in Guyana.
External Debt
Guyana continued to benefit from debt relief under the Multilateral Debt Relief Initiative (MDRI) during 2007. Guyana's outstanding public and publicly guaranteed external debt contracted by 31.1% to U.S. $718 million at the end of the year due to the MDRI and other debt write-offs. As a result, debt service payments declined by 18.1% to U.S. $19 million and the Inter-American Development Bank no longer considers Guyana a highly indebted poor country.
Economy (2007, U.S. $)
Real GDP: $847.9 million.
Real annual growth rate: 5.4%.
Per capita GDP: $1,111.
Agriculture: Products--sugar, rice, fresh fruits and vegetables.
Natural resources: Gold, bauxite, diamonds, timber.
Industry: Types--mining (gold, bauxite, diamonds), agriculture (sugar, rice, livestock, fresh fruits and vegetables), forestry, fisheries, manufacturing (beverage, foodstuff processing, apparel, footwear assembly, pharmaceuticals), construction, and services (distribution, financial, transport and communication).
Merchandise trade: Exports--$680.9 million: gold, sugar, bauxite, fish and shrimp, rice, timber, diamonds. Major markets--U.S., Canada, U.K. Imports--$1.06 billion. Major suppliers--Trinidad and Tobago, U.S., China, Cuba, U.K.
