Guyana
Diary
![]()
|
February 2006 |
Quinta Roraima,
Prados del Este, Apartado 51051, Caracas 1050, Venezuela
Telephone: (58) 212 977-1158 - (58) 212-975-3687
Fax: (58) 212 976-3765
embguy@cantv.net
On the Internet:
http://www.guyana.org/spanish/venezuela_embassy.html
Posted February 2006 - Issue No. 25 - Back to Embassy page
Previous Guyana Diaries are available here.
Finance Minister Saisnarine Kowlessar presented a $102.9 billion budget to the National Assembly on January 23 representing a 19.1 percent increase over last year's. The budget predicts a growth in Gross Domestic Product (GDP) of 4.3 percent and current revenue by 4.4 percent.
The Minister told the House that the budget contains something for everyone and projects growth in a tax free and relatively stable macroeconomic environment.
However, Chairman of the main opposition PNCR, Winston Murray, described the budget as “withholding” and “not transparent”. He called for the budget to be withdrawn, or refashioned and then brought back to the House.
Kowlessar said at the macro level, it contemplates massive spending on the physical infrastructure such as roads, bridges, sea defence, drainage and irrigation, and the social and human infrastructure, such as health, education, housing and water.
More homes will receive electricity; more people will be able to access a wider range of services offered in the social sector; more jobs will be created in an expanding economy.
At the micro level, the income tax threshold has been raised from $20,000 to $25,000 per month and old age pension has been raised to $3,500 per month.
However, the current rates of personal income tax of 20 percent and 33.3 percent will be replaced with a single rate of 33.3 percent.
According to the Minister, approximately 20,000 persons will be removed from the income tax net.
Government has set January 1, 2007, for the Value Added Tax and Excise Tax to become effective.
Government had earlier intimated that the taxes would have been introduced with effect from July 1, 2006.
Kowlessar said the decision was made following consultations with the private sector, which had stringently made representation to delay the implementation of the taxes.
Sugar output for 2006 is expected to increase by 28 percent and bauxite production by 77.6 percent. Inflation is expected to be 6.3 percent.
This turnaround in the fortunes of sugar comes against a 24 percent decline last year. The increase in bauxite production is linked to the advent of the Russian company RUSAL.
Presenting the budget under the theme: “Transforming Guyana through Modernisation and Partnership”, the Minister said the goal is to continue work in the priority areas of the social sector and poverty reduction, while tackling new priorities that affect the safety and security of the society, including crime, sea and river defences, and drainage and irrigation systems
The government on January 28 declared two of the worst flood-hit regions disaster zones and appealed for urgent international help to repair crucial drainage structures and dredge four rivers in a bid to contain coastal flooding.
Thousands of people are suffering and flood control mechanisms have been overwhelmed in the two disaster zones – Region Five (Mahaica/Berbice) and the Pomeroon River basin in Region Two (Pomeroon/Supenaam).
Guyana is asking the international community for mainly financial help to repair vital drainage structures in the two regions and dredge the Pomeroon, Mahaica, Mahaicony and Abary rivers.
The extensive flooding has been caused by unusually high seasonal rainfall and the livelihood of farming communities in the Pomeroon and in the three Region Five river bank districts has been seriously disrupted.
While water levels have dropped in other flood-hit coastal districts, officials and residents on January 28 said the situation was serious and could get worse in the Mahaica, Mahaicony and Abary where floods have overwhelmed crops and livestock farmers.
Currently, the government is seeking to import feed for cattle and other livestock animals running out of fodder in the now submerged sprawling savannah pastures in the Mahaica, Mahaicony and Abary.
Farmers fear they may lose thousands of head of cattle which desperately need feed.
President Bharrat Jagdeo recently confirmed reports of a flooding crisis in the Mahaica, Mahaicony and Abary (MMA) agricultural grid and announced that the mouths of three rivers would be dredged to avoid further flooding.
The mouths of the rivers are widely believed to be heavily silted and experts have said dredging is a possible long term, inter-linking solution to avoid flooding in the sprawling farming communities along the banks of these rivers.
The government, in newspaper advertisements, began inviting expressions of interest from suppliers of dredges and dredging accessories.
At a news conference at State House, Mr. Jagdeo acknowledged that flooding in especially river bank farming communities along the Mahaica, Mahaicony and Abary rivers had reached “a serious crisis level”.
President Jagdeo noted that dredging the mouths of the three rivers, in addition to the Pomeroon River in the northwest region, was suggested as possible strategies to combat the flood problems in these areas.
President Bharrat Jagdeo on January 29 announced that the Inter-American Development Bank (IDB) has been asked to finance the bill for the dredging of the mouths of the rivers.
"We have had estimates which run into somewhere like $4M US to dredge the rivers. They (the IDB) now have to go back and see if they can deliver it in the timeframe", the President said.
Guyana in January assumed chairmanship of the Rio Group from Argentina and created history for the Caribbean Community (Caricom) which it has been representing in the bloc since 1998. The occasion, marked by a ceremony at the Foreign Service Institute in Georgetown, signalled a first for a Caricom member state in the chair of the 20-year-old grouping.
Members of the Rio Group are Argentina, Belize, Bolivia, Brazil, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay and Venezuela.
Guyana during its chairmanship will serve as the Pro Tempore Secretariat and will host the Rio Group Summit this year.
Affixing their respective signatures to formalise the handing over were Guyana Foreign Minister, Dr. Rudy Insanally and Vice-Minister of Foreign Affairs of Argentina, Ambassador Roberto Garcia Moritan. Representing the Dominican Republic, which along with Guyana and Argentina make up the current troika of the grouping, was that country’s Secretary of State of External Relations, Mr. Carlos Morales Troncoso.
Witnessing the signing were Caricom Secretary General, Mr Edwin Carrington, Guyana’s Ambassador to Caricom and Director General in the Foreign Ministry, Ambassador Elisabeth Harper, who chaired the proceedings, members of the diplomatic corps, along with senior and junior officers of the Foreign Ministry.
On March 30, Bauxite and Alumina Mining Venture (BAMV), a subsidiary of the Russian Aluminium Group (RUSAL), will become the majority owner of the Aroaima Mining Company (AMC) on the Berbice River for a consideration of US$20 million.
Under a privatization agreement, BAMV will own 90 percent of Bauxite Company of Guyana (BCGI) and the Government of Guyana 10 percent.
An agreement was also between BCGI and RUSAL for the purchase of over two million tonnes of bauxite annually from the Berbice operations over the next ten years. Another agreement was also concluded with Oldendorf Carriers for the barging, trans-shipment and ocean shipment of bauxite over the same period.
These arrangements directly provide for a total equity investment of approximately US$20 million by the RUSAL Group into BCGI and an investment by Oldendorf Carriers of Lubeck, Germany, estimated at US$60 million, in facilities for the shipping and barging of the bauxite.
Employment levels existing at privatisation are not expected to be significantly reduced from AMC to BCGI. There has been significant down-sizing of the workforce in previous years.
The privatization allows for the sale of certain AMC assets, largely located at Aroaima, to BCGI for cash and a 10 percent equity contribution in the new joint venture which will have a total equity of approximately US$22 million. The assets were valued independently and do not include the Everton location, fixed property in Kwakwani and certain equipment including tugs and barges. Some assets that are not being bought will be leased for up to two years.
Mining is expected to continue for the next two years at Kwakwani and then shift to Kurubuka, located between Kwakwani and Aroaima. Last year, AMC and BCGI had concluded agreements with Hururu Village, which will allow for access to the Kurubuka bauxite deposits that are partially located in that village.
Formal discussions between the government and EU representatives on the National Sugar Action Plan have begun.
The action plan is aimed at mitigating the economic and social impacts of the reform of the European Union (EU) sugar regime for which the EU has committed 40 million euros for immediate adjustment assistance for this year and has only spoken of – not ratified – 190 million Euros a year for the period 2007 to 2013.
Guyana, along with its Caricom and African, Caribbean and Pacific (ACP) partners, has intensified the lobby in Europe to secure a realistic and adequate sum of money for the accompanying measures to cushion the effects of the sugar regime reform, from now until 2013.
Formal discussions began in Georgetown at a meeting in mid-January chaired by Minister of Foreign Trade and International Cooperation, Clement Rohee. Participating were Guyana Sugar Corporation (Guysuco) officials, stakeholders in the sugar industry, representatives of the EU Delegation and the UK Department for International Development (DFID).
The Institute of Applied Science and Technology (IAST) has announced a breakthrough in the conversion of coconut oil into diesel through the modification of available technology to local conditions.
Head of IAST, Dr. Suresh Narine, said that a laboratory produced bio-diesel has been successfully tested on a Caterpillar front-end loader which was donated to the Institute.
Dr. Narine stressed that the production of the fuel is not a Guyanese invention, as bio-diesel is being produced in many countries. He, however, pointed out that the technology has been adapted to suit local conditions.
He explained that the production process of bio-diesel yields glycerol as a by-product which is widely used in the pharmaceutical industry. The development of a local bio-diesel industry will result in economic advantages and other benefits, he said. Dr. Narine noted, too, that bio-diesel is much more environmentally friendly as it produces 75 per cent less carbon emission than conventional diesel.
President Bharrat Jagdeo on February 3 ended a brief but successful working visit to Cuba where he and President Fidel Castro further strengthened the already close ties of diplomatic cooperation between the two countries that go back more than 30 years.
President Castro and his ministers warmly welcomed the Guyanese Head of State and his delegation at José Martí International Airport in Havana on February 1.
At the airport, Mr. Jagdeo spoke in favour of strengthening relations between the two countries and thanked Cuba for its cooperation, particularly in the areas of health and education.
Official talks between the two leaders took place at the Palace of the Revolution.
On the Cuban side, other participants were José Ramón Balaguer, Minister of Public Health; Ricardo Cabrisas, Government Minister; Marta Lomas, Minister of Foreign Investment and Economic Cooperation; Manuel Aguilera, acting foreign minister; and Carlos Valenciaga, member of the Council of State.
President Jagdeo was accompanied by Public Service Minister, Dr. Jennifer Westford, and General Director of Health Services, Ministry of Health, Dr. Bheri Ramsaran.
“We will work to expand relations and cooperation with Guyana, mainly in the field of health”, the Cuban leader is reported to have said during the official welcoming for President Jagdeo and his delegation at Havana's Revolution Palace.
The cooperation between both countries covers diverse sectors, including public health, agriculture, forestry, construction, scientific research, civil aviation, fishing, foreign trade, culture, education and sports.
The Guyanese delegation had a full work agenda, which included visits to various health and sports centres, and meetings with Guyanese students studying in Havana.
President Jagdeo was also very impressed with the Pando Ferrer Ophthalmological Institute which he toured on February 2.
Accompanied by Minister Cabrisas, President Jagdeo was given an extensive tour through various health centres in Havana where he had a first hand look and assessment of the tremendous achievements of the ophthalmological programme.
At the Operation Miracle Centre in Marina Hemingway, President Jagdeo was received by Elia Rosa Lemus, an official of the Council of State, and Dr. Gessiz Rodríguez Fernández, director of the centre.
He further talked with Castro about the idea of establishing an eye care centre in Guyana where diagnoses and even operations could be performed.
He also met Guyanese patients in Cuba who thanked him for his visit and expressed their satisfaction and congratulations for their exquisite treatment on the part of nurses, doctors and social workers who are attending to them in Cuba.
“This visit will contribute to reinforcing the excellent ties of friendship and cooperation that exist between the two brotherly peoples of the Caribbean and their respective governments,” the Cuban newspaper Granma reported.
Improved economic activity resulting in increased revenue generation in Guyana over the years has translated into increased central government revenue.
Minister of Finance Saisnarine Kowlessar in his 2006 Budget Speech on January 23, reported that current revenue rose sharply by $4.4 billion or 8.4 percent to reach $56.1 billion in 2005.
He said this increase is due to higher non-oil imports and corporate tax collection, and the benefits of the substantial reforms implemented over the last five years.
Revenue collected by the Customs and Trade Administration increased by $2.3 billion to $25.8 billion while the Internal Revenue Department increased its collection by $2.4 billion to $27.1 billion.
In 2005, monetary policy continued to facilitate a sound macroeconomic environment and promote private sector credit expansion.
Net domestic credit by the banking system increased by 11.5 percent to $40.1 billion in 2005 reflecting higher public and private sector deposits.
Net credit to the public sector increased by 241.4 percent or $2.4 billion. Private sector deposits, which amounted to 71.8 percent of total deposits of residents at the end of 2005, grew by 8.3 percent.
Expansion of the private sector in 2005 was also reflected by the increase in credit to the private sector which expanded by 9.1 percent. Credit to the agriculture and manufacturing sectors increased by 11.4 percent and 5.4 percent respectively.
Reflecting the expansion of the services sector last year, loans to the personal, distribution and real estate sectors rose by 25.2 percent, 1.5 percent and 25.1 percent respectively.
Central government revenue has increased considerably over the years. From $11.8 billion (US$106 million) in 1991, it has grown to $56.1 billion (US$279 million).
The main opposition People’s National Congress Reform (PNCR) is arguing that Guyana will not move forward unless there is good governance characterised by transparency and accountability.
Wrapping up the 2006 budget debate on February 3 in the National Assembly, Leader of the Opposition and the PNCR, Mr. Robert Corbin said the budget has laudable objectives but is without the requisite policies and programmes to achieve these and its theme of “Modernisation and Transformation Through Partnership” is misleading.
He charged that the budget lacks the “philosophical underpinnings” and should be put aside, because in addition it is in breach of the law, as it failed to meet the requirements enshrined in the Fiscal Management and Accountability Act.
The PNCR leader said his party would be the first to commend the government if what is projected in the budget were accompanied by a feasible programme to achieve them.
According to him a fundamental flaw in the budget is that it failed to take into account recommendations and reports made out of studies by experts such as those in the National Development Strategy (NDS) and to use the experiences of the past to guide for the future.
He rejected the government’s argument that the floods last year were responsible for the economy performing poorly, and instead asserted that this was due to “colossal mismanagement of the country’s affairs” associated with “poor planning, visionless management and technical incompetence.”
The response by the government to the floods, Corbin claimed, is an apt demonstration of this.
“The President and his ministers are running around like merry men carrying out damage control,” he charged, adding that he has met people in several communities with slips to obtain flood assistance but have failed to so since the floods of last year.
He added that only when citizens mount protests is attention paid to their plight by the government and this is not a healthy development for the country as this is a sign that it is descending into anarchy.
He noted too that such developments are an indication that the society has deep-seated problems which should be addressed.
Lack of accountability and corruption has led to a disastrous situation, Corbin alleged, claiming that the drug business has been responsible for propping up the economy.
He launched a scathing attack on the President’s Youth Choice Initiative programme, describing it as a “colossal failure,” and questioned why it is managed by the Office of the President through Presidential Adviser on Empowerment even though there is a Ministry of Culture, Youth and Sport.
Failure to appoint a Chancellor of the Judiciary and appointing the Integrity Commission without consultation was cited also by Corbin as evidence of the government’s refusal to abide by the rule of law. The PNCR leader said Guyana is in a state where the fragility of the social fabric is likely to deteriorate if a constructive approach and speedy actions are not taken.
He claimed that the society is characterised by brutal murders, an uncertain future, scarce jobs, uneducated youths, heavy losses by the agricultural community due to floods and unfair competition for the business community from the drug business, coupled with escalating electricity rates.
“Business and earning comes from the needs we have and the arrangements we make to satisfy those needs.”
Those were the sentiments expressed by Prime Minister Samuel Hinds on January 28 during the opening of the Upper North Ruimveldt Shopping Mall, located at Aubrey Barker and Christiani Street, North Ruimveldt.
Present at the opening ceremony were chairman of the Upper North Ruimveldt Community Development Council (UNRCDC), Mr. T. Sheppherd, vice chairman Mr. R. Blackman and representatives of religious and other community groups in the area.
The mall which was first envisaged in 1996, was the brainchild of the UNRCDC in association with Prime Minister Hinds.
According to Prime Minister Hinds “I am encouraged by the magnitude of work completed by persons in this community in transforming an empty plot of land into a commercial business centre, which holds numerous economic prospects for residents.”
The mall is comprised of 45 stalls and features a variety of services, among which are internet access, hair-dressing, butchery, medical centre and snackette.
Government will continue to develop the housing sector across the country by allocating more house lots, installing more water distribution networks and constructing more roads and drainage structures.
As was outlined in the $102.9 billion 2006 National Budget on January 23, over $1.9 billion has been allocated to increase access to improved housing facilities for low income families.
Presenting the budget in the National Assembly, Minister of Finance Saisnarine Kowlessar explained that under Phase Two of the Low Income Settlement Programme, $1.1 billion has been provided to develop another 5,300 house lots in areas such as Zeelugt North, West Coast Demerara, Hampshire South and Williamsburg South on the Corentyne Coast.
Under the Low Income Housing Development Programme, approximately $500 million has been budgeted to construct roads, drains and other structures, while the installation of water distribution network in squatter settlements such as Belle West, West Bank Demerara, Glasgow in Region Six and Areas ‘Y’ Cummings Lodge and Sophia, Greater Georgetown among other areas will also be done.
The Finance Minister said that under a programme which will be supervised by the Central Housing and Planning Authority, about $360 million will be expended to develop housing infrastructure at Port Kaituma, Mabaruma, Orealla and Siparuta.
The executive members who would comprise the Guyana side of a Guyana/China Joint Business Development Council were recently elected at a meeting which was held at the Ministry of Foreign Trade and International Cooperation.
Those elected were Mr. Gerald Gouveia, President of the Georgetown Chamber of Commerce, and Mr. Clinton Williams, Chief Executive Officer (CEO), Guyana National Industrial Company Inc. (GNIC), who will function in the capacities of president and vice-president, respectively. Ms. Shauna Small, Foreign Trade Officer, Ministry of Foreign Trade and International Cooperation, will serve as the executive secretary. The executive members will be supported by a number of other members to be drawn from the business community.
These appointments were finalised in anticipation of the signing of an agreement on February 16, 2006, to launch the Guyana/China Joint Business Development Council, when the members of the Guyana side are expected to meet their Chinese counterparts, and also participate in an inaugural meeting of the council. It is expected that the council will promote greater trade between Guyana and China.
The members of the Guyana-side are upbeat about the prospects of this initiative, since the council would serve to further strengthen our bilateral cooperation and the excellent relations, which already exist between Guyana and China.
Agreements for Joint Business Development Councils have also been signed with Cuba and India.
The Roraima Airways group announced recently that it will be investing about $600 million to build two hotels with a total of 77 rooms – one in Georgetown and the other in Linden – to target Cricket World Cup 2007.
“The project is also part of our long-term expansion programme and will be employing about 150 people,” managing director Captain Gerry Gouveia said.
According to Gouveia, the site for the Linden hotel has been identified while negotiations are ongoing to acquire the land for the hotel in Georgetown.
Roraima Airways is currently building its new office and terminal building at the Ogle Aerodrome as part of the Ogle Municipal Airport project.
Gouveia explained that his company will be working closely with airlines in Suriname and Venezuela with a view to offering scheduled services to Guyana out of the Ogle Airport.
“We are also looking at acquiring another aircraft – either an Islander or a Twin Otter,” he added.
Meanwhile, Roraima Airways is currently spending US$300,000 on the construction of a private executive lounge at the Cheddi Jagan International Airport, Timehri.
A credit programme was launched recently in Santa Rosa in Region One by Minister of Amerindian Affairs, Carolyn Rodrigues.
The programme is intended to promote self-sufficiency and a greater sense of economic independence in the Amerindian community. Its establishment is expected to provide an opportunity for families and community members to access loans for economic ventures.
The programme will cater mainly for farmers, shop owners and other businessmen and women seeking to enhance the quality and service of their businesses.
Guyana has lost rice with an export value of US$4 million ($800 million) as a result of the current flood, which has left fields inundated and farmers distressed, Chief Executive Officer of the Guyana Rice Development Board, Jagnarine Singh has said.
But he urged farmers not to panic, even in the face of massive flooding, which has swamped their plots.
Singh said some of the rice crop would be saved and things were not as bad as some were describing it. "The truth must be told. While lots of rice fields may be swamped and not recover several others are going to make it through the floods, once things improve," Singh said.
He said some 128,782 acres of rice were sown across the country. Of that amount, the current flooding has already destroyed 12,964 acres and more could go if the floodwaters remain. In Guyana's largest rice-growing area, Region Five, approximately 8,800 acres of rice have been destroyed, according to Singh.
Giving a breakdown of rice losses so far he said in Region Two (Pomeroon/Supenaam) approximately 678 acres of rice have been destroyed; 1,084 in Region Three (Essequibo Islands/West Demerara); 102 acres in Region Four (Demerara Mahaica); 8,800 acres in Region Five (Mahaica/West Berbice) and 2,300 in Region Six (East Berbice/Corentyne). Singh said the losses represent 1,400 tonnes of rice, which has an estimated value of US$4 million.
But he said although the 12,964 acres were significant, Guyana would still be able to satisfy its Caricom and European market commitments. He said there could be a shortfall to other countries.
Credits: Stabroek News, Chronicle, Mirror, Kaieteur News, GINA
Compiled and edited by Evangeline Ishmael
This page is part
of Guyana News and Information.
(http://www.guyana.org)
© Copyright 2006