Georgetown : In a statement, the International Monetary Fund (IMF) mission which conducted the Fund’s yearly review of the Guyanese economy said that the economy continues to be resilient and commended the Administration for its continued prudent macroeconomic management.
IMF Mission Chief Therese Turner-Jones said that despite a deteriorating external environment, including the deepening euro-zone crisis, Guyana’s economy recorded another year of impressive growth of more than 5 percent in 2011.
She noted that the growth was due in part to high commodity prices, foreign direct investment, and domestic credit expansion to the private sector.
Turner-Jones projected the growth of Guyana’s Gross Domestic Product (GDP) by 4 percent in 2012. The increased GDP will be supported by “increased activity in bauxite, gold, rice and the services sectors, which should offset any expected fall off in sugar production.”
The IMF team noted however, that while inflation remained low, there was a “marginal drop in gross foreign reserves to about four months of imports at end-June 2012, as capital imports rose.”
The Fund observed that infrastructure projects led by construction of the hydro power plant at Amaila Falls (AFHP) along with private mining investments should sustain growth levels at around 5 percent.
Turner-Jones stated that “discussions with authorities centered on how to maintain fiscal and debt sustainability while reducing poverty through continued inclusive growth in the context of the Low Carbon Development Strategy (LCDS).”
The IMF team commended Guyana’s progress on the Millennium Development Goals (MDGs), along with ongoing efforts by the authorities to build consensus around priorities for meeting Guyana’s social and developmental needs.
“While the banking system remains liquid and well capitalized, continued vigilance is warranted, particularly against the backdrop of rapid credit expansion,” Turner-Jones noted.
Welcoming the continued decline in nonperforming loans, and the advanced plans for introducing a credit bureau, the administration was urged to further strengthen the Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) regime in line with the recommendations made by the Caribbean Financial Action Task Force (CFATF) in its July 2011 assessment report.
The IMF Executive Board is expected to discuss Guyana’s Article IV consultation in September 2012.
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