Vice President, Bharat Jagdeo today announced a series of measures aimed at ensuring a greater supply response to decrease food prices in the country. The government’s strategy focuses on boosting agricultural production and improving supply chain mechanisms to stabilize and reduce the cost of food items for consumers.
During his weekly press conference, Jagdeo emphasized that the government recognizes the current challenges faced by citizens due to rising food prices. “Now yes, it’s true that food prices have moved up and we are working to ensure a greater supply response,” he stated.
He said in just four years, with two of those years impacted by COVID-19, and amidst inflationary pressures affecting major economies like the United States, the Guyanese government has implemented direct policy interventions to mitigate cost of living increases. Despite the greater capacity of larger economies to handle such challenges, Guyana has successfully shielded its population from some of the most significant cost increases experienced elsewhere.
Jagdeo explained the government’s strategy to stabilize fuel prices as a core component of their plan. “To present the 50 percent excise tax, which was equivalent to $81 billion of taxes, we reduced it to $1 billion of taxes reduced on only two items, diesel and gas,” he said. This measure has resulted in a $500 per gallon subsidy, helping to keep prices at the pump stable. This stability in fuel costs has been crucial in preventing increased transport and production costs.
The Vice President highlighted the impact of these fuel subsidies on utility bills. “We have kept electricity rates constant. It has cost the 66 to 70 million US dollars of subsidy only on fuel, leaving out the tens of billions that we’re spending on new power generating capacity and upgrading the transmission system,” he noted. He also announced plans to cut utility bills by 50 percent by next year, which will further alleviate the financial burden on consumers.
In addition to fuel and utility measures, Jagdeo discussed the government’s actions on mortgage rates. “Mortgage rates in Guyana have come down in spite of global increases in interest rates,” he stated. This reduction is partly due to a policy intervention where the government removed corporate tax from income arising from loans below a certain threshold. This move is aimed at making homeownership more affordable for Guyanese.
Jagdeo also addressed the increase in water rates, noting they have been cut by 5 percent. “Water rates have been cut by 5 percent,” he confirmed. This action is he said, is part of the government’s broader effort to manage living costs despite global inflation.
Furthermore, Jagdeo discussed the broader economic context and the government’s responses to various challenges. He highlighted the contrast between the current administration and previous governments, noting the impact of past policies on inflation. “You look at the alternative, think about an administration that didn’t address inflation and the costs associated with it,” he said.
The Vice President stressed the government’s direct interventions in managing the cost of living, asserting that these measures have mitigated some of the most substantial cost increases faced by other countries.
