Economy needs to be diversified for there to be growth – Professor

first_imgDespite being rich in natural resources, Guyana remains dependent on only a few of those resources while its economy continues along a downward slide.Thus, Professor David Hinds has suggested that Guyana has to diversify its economy in order to save it. He stated that the dependency on two or three resources was one of the reasons why the economy has been slothful.“So, we have to move away from the dependency on one or two resources, because what happens when we don’t do well in rice or sugar? The economy doesn’t do well either,” he said.Dr Hinds posited that though oil was on the horizon, it would not solve our economic woes, because “we will continue doing what we have done with sugar and rice”.He pointed out that the manufacturing sector in Guyana was almost dormant, noting that while the country produced rice, there was still no proper functioning manufacturing industry around it.Economist, Dr Thomas Singh, told Guyana Times that Guyana has grown comfortable with just producing rice and sugar and has neglected other avenues to invest in. He stated that at one time Guyana was the envy of the Caribbean market, but now the economy has deteriorated. Dr Singh recalled a time when the economy was blooming and Guyana was benefiting from the exportation of cotton, rice, sugar, timber, gold, diamonds, bauxite and even confectionery.According to Singh, following Guyana’s independence, the manufacturing sector had accounted for 5.9 % of the country’s Gross Domestic Product. However, shortly after that period, the market economy was quashed and the then Government began experimenting with a socialist model – where they controlled everything, including the up and coming manufacturing sector.At present, Guyana’s manufacturing industry contributes about 10 per cent of the country’s GDP, providing employment for a scanty 12 per cent of Guyana’s population. There has been no growth of the value-added, export-oriented industry, where Guyana moves beyond manufacturing these few products to large-scale manufacturing of clothing, and forest, technology and glass products.However, Dr Hinds believes that there is hope for the economy. He stated that small businesses were very important in building an economy. Therefore, it is imperative to pay attention toward the re-development of the village economy.He highlighted that there were hundreds of acres of land aback of villages, “so why not spend money in developing those lands. …and if you develop those lands it becomes easier for farmers to take advantage of a developed land. Farming can become attractive in the villages. They can plant different vegetables and sell and the agriculture sector would grow and the spinoff would be a budding economy,” he posited.He added that the same emphasis that was placed on attracting foreign investments should be placed on developing a local economy and a local entrepreneurial class.Previously, Hinds had supported the need for the establishment of a Ministry of Economic Planning and the development of a national economic plan. He said, “Both the Government and the Opposition should sit down and come up with a National Development Plan for Guyana.”Former Auditor General Anand Goolsarran had also emphasised the need for an economic plan to take the country forward, and advanced the call for the establishment of a much-needed Ministry of Economics over some of the other established Ministries, such as Social Cohesion.“Guyana urgently needs an economic plan, especially in our current economic situation,” said Goolsarran.He had lambasted the Government for its denial of the current ailing state of the country’s economy. He said a three per cent growth in Gross Domestic Product (GDP) did not mean that all was well with the economy. He pointed out that 40 per cent of the youths are unemployed, there was evidence of under-employment, businesses were struggling and there was also the existence of parallel economies.last_img

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