Addressing a packed audience at the historic stakeholders’ forum at the New Thrieving Restaurant, Proividence East Bank Demerara on Saturday evening, the People’s Progressive Party/Civic presidential candidate, Irfaan Ali outlined that over the past three years, the local economy has suffered tremendous difficulties with private consumption falling by $196 billion, while tax collections have increased.
“It therefore means that the increased tax collection was not as a result of growth in consumption but as a direct result of the 200 new tax measures. Our economy is showing some worrying signs. Non-performing loans increased by $28 billion, 58 per cent of this is in the business sector. This means a lot of our businesses are at risk especially the small-medium size businesses. We’ve seen the effects of this at the regional level, where a number of big businesses have closed or downsizing causing loss of jobs,” he posited.
Highlighting that domestic credit of commercial banks to the central bank increased by a whopping $259 million whilst domestic credit to the Private Sector grew marginally by 12 per cent, Ali pointed out that this shows a contraction in the Private Sector with less borrowing and this is a direct result of no new businesses opening and very limited expansion in existing businesses.
As such, he noted that in the future, it is imperative to critically analyse spending priorities and cut out waste.
“Going forward, we cannot afford to manage the economy on tradition indicators and ratios. Instead, we have to manage our economy to ensure sustainable development which balances economic growth with social development and environmental priorities. The development must be felt by every Guyanese. In this regard, we have to focus on issues of inequality, income distribution, vulnerability of at-risk communities and groups so as the tide of the economy rises, all would be placed in a better position,” Ali asserted.