[www.inewsguyana.com] – The Economic Commission for Latin America and the Caribbean (ECLAC) has adjusted its projections for the economies of Latin America and the Caribbean, which the commission says will experience average growth of 2.2% in 2014, down from the 2.7 % predicted.
The United Nations regional commission unveiled its report Economic Survey of Latin America and the Caribbean 2014, in which it cut the regional growth forecast for 2014 that was issued last April.
The study states that Guyana’s economy is expected to grow by 4.5 percent this year, compared to 5.2 percent in 2013, with Suriname, expected to grow by 4.4 percent. These are followed by Trinidad and Tobago at 2.2 percent, Jamaica at 1.2 percent and Barbados at 0.5 percent.
The study also states that the Guyana mining sector and rice industry will remain the principal drivers of growth, with the downside risks, being fall in commodity prices and the country’s awkward political situation, which could adversely affect investors’ interest.
“The fluctuations in the price of gold are among the downside risks, but foreign investment in the sector, along with the activities of small- and medium-scale miners, is expected to continue to boost the economy,” the ELAC report on the Commission’s website states.
Whilst the rice, manufacturing, and sugar sectors performed better in the first quarter of 2014, compared with the corresponding period in 2013, the report said that the sugar sector has not emerged from its difficult years of low production and predicts that improvement in the sector will be marginal until the Guyana Sugar Corporation completes its recapitalisation and mechanisation initiatives under its 2014-2017 strategic plan.
Highlighted, however was the fact that the construction sector continues to drive growth with public and private investment.
The ELAC report noted that government has had difficulties in implementing its policy agenda since the opposition gained a majority in the parliament in 2011. It highlighted the opposition cutting the budget in 2013 and the key government policies including the Low-Carbon Development Strategy and various capital expenditure projects that were affected by this situation.
Noted is that one of the main areas of concerns, remains the failure to pass key legislation on financial crime – the Anti-Money Laundering and Countering of Financing Terrorism Bill.
“Indeed, this could prejudice the country’s access to international financial markets and foreign investment,” the report states.
The ELAC reported noted that being the only country in the Caribbean which has not passed the bill, Guyana was blacklisted by the Caribbean Financial Action Task Force (CFATF), and this may discourage financing institutions and investors from dealing with Guyanese institutions.
The report added that Guyana continues to maintain strong ties with China in spite of the non-passage of the Bill. It highlighted the fact that the government signed several bilateral loan/grant agreements in 2013 and during the first quarter of 2014 and among them were a series of agreements with China.
[Extracted and modified from GINA]