According to the latest Caribbean Quarterly Bulletin of the Inter-American Development Bank (IDB), Guyana’s growth outlook in the medium term remains quite positive based on continued improving perspectives for oil production, despite low oil prices and the coronavirus pandemic.
Expounding on this front, the bank said that for the five-year period between 2015 and 2019, Gross Domestic Product grew at an average annual rate of 3.6 percent, surpassing the average of 2 percent for Latin America and the Caribbean and placing Guyana 5th out of 26 countries. The financial institution also said that GDP growth reached 5.4 percent in 2019, higher than the 4.4 percent in 2018.
With respect to the pandemic, the bank said that it has had varied outcomes on different sectors of the non-oil economy. In this regard, it noted that the largest productive sector of the economy, agriculture (17.6 percent of GDP), suffered a contraction of 4.1 percent in the first half of 2020. However, rice production is expected to expand by around 3 percent in 2020, which would contribute to mitigating the contraction in agriculture.
As for the mining industry, Guyana’s second-largest sector with 14.9 percent of GDP, the bank said that it expanded by 343.7 percent in the first semester after oil production began in December 2019. In relation to gold production, which represents almost 10 percent of GDP, the IDB said that this sector grew by 2.1 percent in the first half of the year, bolstered by historically high prices of gold.
Turning its attention to the services sector, potentially the sector most exposed to social distancing policies, it noted that there was a 3.8 percent decline in the first half of the year, with wholesale and retail trade falling by 14.7 percent, transportation and storage by 25 percent, and accommodations and food services by 32.9 percent.
Local authorities estimate that non-oil GDP contracted by 4.9 percent in the first half of 2020, and it is projected to fall between 1.4 and 4.3 percent in the full year.
