Poverty Reduction Strategy Paper Progress Report 2005

Despite the continued vulnerability of the economy to exogenous shocks, the inadequacy of infrastructure, and the weakness of existing institutional capacity, there has been considerable progress in actions and reforms initiated by the government within the framework of the poverty reduction strategy. However, additional resources will have to be mobilized for Guyana to continue to improve its productive capacity, and to improve and maintain its infrastructure. The government has implemented an ambitious legislative and regulatory reform agenda to advance its support for economic growth.


Despite the continued vulnerability of the economy to exogenous shocks, the inadequacy of infrastructure, and the weakness of existing institutional capacity, there has been considerable progress in actions and reforms initiated by the government within the framework of the poverty reduction strategy. However, additional resources will have to be mobilized for Guyana to continue to improve its productive capacity, and to improve and maintain its infrastructure. The government has implemented an ambitious legislative and regulatory reform agenda to advance its support for economic growth.


The Context

The Government, over the last several years, has embarked on an ambitious legislative, regulatory, institutional and social sector reforms with a view to creating a business friendly environment, generating growth and improving access to social services. Guyana was rewarded with positive growth in 2004-a reversal from the negative or zero growth rates in previous years--and improvement in social conditions. However, these developments took place in the context of difficult external challenges and unaccommodating domestic conditions. While the Government does not have control over its external environment, it has greater degrees of freedom in ensuring internal balance to provide predictability, confidence and improved social cohesion.

The Domestic Environment

Key issues identified in the 2004 Poverty Reduction Strategy Progress Report included the challenging external environment, low absorptive capacity, difficult sociopolitical conditions, and the weak monitoring and evaluation of the poverty reduction strategy programme. These problems continue to persist. Progress in achieving the PRSP targets and the Millennium Development Goals is, in part, contingent on the successful resolution of these issues.

In addition, 2004 and 2005 presented unique problems. Perhaps, the most serious shock that the country has experienced and which has possible long-term implications, is the national disaster that occurred in January 2005. Unprecedented rainfall and accompanying flooding resulted in the displacement of 70,000 households, and caused economic damage in excess of 57 percent of GDP, that is projected to cost US$200-300 million for recovery and reconstruction.

The simmering political battles between the major political parties continue to create political instability and act as a disincentive in attracting direct foreign investment and retaining domestic capital. In spite of some improvement in the crime and security situation, Guyana continues to lose its critical entrepreneurial and professional skills to migration.

The External Situation

The external environment has not been kind to Guyana. For an oil dependent country, the oil price hikes in 2004 had a devastating ripple effect on the cost of living, external balances and the competitiveness of Guyana’s products on the world market. Depressing primary commodity prices have not provided the cushion needed to mitigate the impact of higher import prices. Guyana’s primary export commodities of sugar, rice, bauxite and timber are not expected to see any appreciable increase in price over the medium term.

Most significantly, changes in the European Union sugar protocol, which will reduce sugar prices in the EU by 39 percent over four years, will adversely affect Guyana’s main foreign exchange earner. Sugar contributes 17 percent to GDP, over 25 percent of foreign exchange earnings and directly employs over 17,000 people. While modernizing and restructuring the sugar industry will help to mitigate the effects of these changes, unless the European Union provides financial support to ACP sugar exporting countries including Guyana in a timely manner, the welfare implications of the retrenchment of workers employed directly or indirectly by the sugar industry will be devastating.

Major Challenges

These problems present a number of challenges to the Government. First, the crime and security situation will have to be tackled and dealt with definitively if Guyana is to minimize the migration of its highly trained professionals and entrepreneurs whose skills and resources are needed to propel growth. Second, Guyana, being the only English speaking country in South America and a member of the Caribbean Community, Government will have to make concerted efforts to market Guyana’s abundant natural resources and strategic geographic location to the international investment community. Third, the political impasse that continues is counterproductive to making Guyana attractive for investment or in creating the peace and stability critical for development. The continuation of the present political situation increases sovereign risk and raises the cost of capital especially foreign for investment. Fourth, Guyana requires additional resources to meet the investment cost critical to re-building its productive capacity and completing reconstruction in the wake of the recent unprecedented flooding. Given its commitment to maintaining sustainable debt management, the Government may have to pursue more grant resources for its development programmes and reprioritize its investment and other programmes. Finally, the disruption of economic activities and dislocation of people as a result of the recent flooding has brought into sharp focus the challenges of increasing public and private resources for routine and regular maintenance of roads, for drainage and irrigation systems and the conservancy dams, for designing and implementing improved standards in roads, for revising and upgrading building codes, and for establishing and strengthening disaster management systems to mitigate the impact of future disasters.

Addressing these challenges is critical to establishing a sustainable framework for meeting the PRSP targets and the MDGs. Benefits include peace and tranquility in the body politic and social life; reduced sovereign risk; the stemming of migration; and renewed confidence and certainty for economic actors and the general population. To achieve the required impact, these challenges have to be addressed in tandem. Resolving them on a piecemeal basis will only prolong the delay in meeting the PRSP targets and attainment of the MDGs by 2015.

Achieving PRSP Targets and the Millennium Development Goals

In attaining PRSP targets and the Millennium Development Goals (MDGs), Guyana continues to make progress, although more effort will be required to achieve all the targets as set out in 2001. The medium-term programme elaborates the Government’s approach to addressing some of these. Of critical importance, however, is the costing of the poverty reduction programmes to determine the need for additional financing to help Guyana to achieve the MDGs by 2015 and/or beyond.

Organization of the Report

The 2005 Progress Report is organized as follows:

Chapter 2 provides a summary of poverty indicators in Guyana. In the absence of the Household Income and Expenditure Survey (HIES), the report uses the 2002 population census data to gauge the extent of poverty in Guyana. With the 1980 population census as the baseline, this chapter presents an analysis of the long-term trends in poverty profiles. Data deficient areas such as the number of persons living with disabilities or HIV/AIDS, and the degree of access to social services by residents of rural and isolated communities are also addressed.

The review of economic developments in 2004 is undertaken in Chapter 3. In particular, attention is paid to growth, fiscal and monetary developments and structural reforms implemented in 2004. Further, the chapter reviews developments that took place in restructuring and modernizing the traditional sector with emphasis on agriculture, mining, and forestry. Developments in the new growth areas were also reviewed. Governance issues are also discussed in this chapter.

Achievements and setbacks experienced in social sector development are highlighted in Chapter 4. Specifically, the chapter deals with advances made in previously identified priority areas in the social sector such as education, health, housing and water. In particular, the chapter focuses on progress made in access, equity and delivery of social services.

Chapter 5 focuses on the on-going implementation of works to upgrade and maintain critical infrastructure, in accordance with the infrastructure strategy described in the PRSP. Areas addressed include sea defences, roads, bridges, river and air transport, drainage and irrigation and maritime affairs. Special attention is paid to developments in the hinterland areas and efforts to encourage self-sufficiency, and to promote economic and social development in these regions.

Public consultation and feedback from the civil society on the poverty reduction strategy is the subject of Chapter 6. The process leading to the consultations is described and matrices representing sector issues and recommendations were prepared for all the ten administrative regions. These matrices are captured in Annex D of the report. However, the national summary of the feedback from the public consultations is included in this chapter.

In Chapter 7, a medium-term macroeconomic framework is elaborated. Specifically, the macroeconomic outlook is assessed, taking into account the key challenges facing the country and assumptions of returning the economy to a higher growth trajectory. In this context, a prioritized five-year rolling investment programme is discussed, policies and reforms to promote growth are presented, structural reforms critical to support investment, governance, the rule of law and political stability are also elaborated.

Improvement in economic and social infrastructure is the focus of Chapter 8. In economic infrastructure, the emphasis is on disaster mitigation and laying the groundwork for developing a transport network to facilitate growth. Attention is therefore paid to rehabilitation of sea defences, implementation of a transport sector study that will determine the future course of action in that sector, and improvement in drainage and irrigation systems and the conservancy dams. In the social sector area, the focus continues to be the priorities set in the 2001 PRSP for improving access and quality of services in the education, health, water and housing sectors, and designing and implementing programmes that will reduce poverty in regions where extreme or absolute poverty is high or the depth of economic depression requires government intervention. The chapter also addresses the medium-term plans in improving social safety nets.

An assessment of monitoring and evaluation of the poverty reduction strategy is provided in Chapter 9. In particular, this section reviews the institutional capacity of the monitoring and evaluation structures with a view to providing recommendations for their strengthening. In addition, the chapter addresses the core issues of M&E, particularly the role of feedback from civil society in policy analysis and programme formulation. The dearth of data is also addressed with recommendations provided for improving social statistics for assessing programme outcomes, and improving budgetary information to describe programme inputs.

Chapter 10 inserts a cautionary note by highlighting the risks to the medium term poverty strategy while Chapter 11 provides a Summary and Conclusions of the Report.



Guyana has undergone major political and economic changes over the last twenty-five years. On the political front, multi-party democracy accompanied by free and fair elections has, since 1992, replaced the effectively one-party system that was entrenched in 1978. The one-party political system also influenced economic policies. Consistent with its socialist orientation, more than 80 percent of the total value of recorded imports and exports was controlled by the state. State intervention, accompanied by poor economic policies, contributed to persistent negative growth rates. The high correlation between economic growth and poverty reduction meant that a high proportion of population was pushed into absolute and extreme poverty. The poverty surveys and analysis conducted during this period bear testimony to this outcome.

Since Guyana began implementing structural market-oriented reforms in 1989, economic growth has accelerated, averaging 3 percent between the period 1994-2004. During this period, US$681.8 million was disbursed to Guyana and over US$336 million was received in grants, in support of improving economic infrastructure, human resource development, governance and institutional reforms. Through implementation of prudent policies and generous debt relief from donors, Guyana’s external debt declined from US$2.1 billion in 1992 to about US$1.2 billion in 2004, freeing much needed resources to improve economic and social infrastructure. The measurement of poverty and its trends will be gauged in the context of these developments.

Measuring Poverty

Poverty is a multidimensional phenomenon and can be defined and measured in a number of different ways. In Guyana, the Income Approach, Household Income and Expenditure Survey (HIES), the Living Condition Survey (LCS) and the Basic Needs Index have been used to measure poverty. While the quantitative measurements of poverty may give different results, the characteristics of poverty in Guyana remain the same: deprivation of the material for meeting basic human needs. People are poor because they lack income, food, clothing and shelter.

The last poverty survey, the LCS, was conducted in Guyana in 1999 and the results were captured in the 2001 PRSP. A HIES will be undertaken in September 2005 and preliminary results will be available in July 2006. The HIES which was initially planned for March 2005, was postponed as a result of the national disaster that struck Guyana in late December 2004 and January 2005. The unprecedented rainfall and associated flooding that made it virtually impossible to conduct the survey. In the absence of the HIES, census data will be used in the 2005 PRSP Progress Report to measure the extent of poverty in Guyana. Emphasis will be placed on both qualitative and quantitative measurements of poverty, particularly with respect to access to basic needs. Specifically, the chapter will review progress or the lack thereof, in the following areas:

  • access to shelter

  • access to safe water and improved sanitation

  • access to electricity

  • access to healthcare services

  • access to education

  • and labour force participation.

Although there are clearly many other elements of poverty, from a human capabilities perspective, these key and easily measurable elements of poverty provide a good picture of the status of the population. Guyana’s 2002 census report will be published in October 2005. The delay in publication is attributable to agreements with CARICOM to jointly publish all census data together. Meanwhile, the Government will publish about 20 key summary tables of the 2002 census in August 2005.

Poverty Trends

In the context of the menu of economic and social reforms that were introduced in the last three decades, an attempt is made to use census data to measure poverty trends especially as they relate to basic needs, human resource development and economic opportunities. Given the changes in the census questionnaire over the period, emphasis is placed on using the same indicators for easy comparison. The 1980 census data is used as the basis for the analysis, so that the 2002 census data is compared with the 1990 and 1980 census information.


Guyana’s population over the last 20 years has barely changed. At 751,223 in 2002, it was actually 35,894 or 1.2 percent below the 1980 population. However, between 1980 and 1990, the population fell by 4.8 percent. With natural rate of increase of 1 percent per year, this represented about a 15 percent decline in Guyana’s population. In part, this substantial decline in the population resulted from the high levels of migration brought about by the harsh economic, social and political conditions that prevailed during this period.

The trend of migration eased somewhat during the period 1990 to 2002, with the population showing an increase of about 27,000 people. Also contributing to the modest rise in the population may be remigration of Guyanese in the early 1990s. Nevertheless, with so many Guyanese residing abroad, the pull factor remains strong. Sponsorship of family members by relatives living elsewhere continues to have a considerable influence on migration trends and a dampening effect on population growth.

In terms of the distribution, Region 4 is the most populated area in Guyana with about 41 percent of the population. The number of people living in this region has remained fairly constant over the last 20 years. Region 6 is the second highly populated region with about 17 percent of the population. But it is also the region, which experienced the highest level of, perhaps, internal out-migration over the two decades. The population in all the hinterland regions increased over the last 20 years, with Region 8 registering the highest increase as a result of internal migration.

Several factors account for the underlying changes in population within the regions. First, increased expansion of economic activities in Region 4, accompanied by the high level of distribution of house lots may have contributed to the steady state of the population. Second, increased mining and forestry activities in the interior regions, with concomitant job creation, may account for the increase in population of these regions. Third, and perhaps, the most interesting aspect of the population trends is the growth in population in Region 10. With the adverse changes in international bauxite prices and new production lines in Brazil and China, the high production costs at Linmine, and the restructuring and privatization of the bauxite entity, the population in Region 10 would be expected to decline. In spite of these factors, however, the population in Region 10 actually grew over the last 20 years. Gold mining, principally Omai operations, forestry and agriculture may have accounted for the population increase.

Table 2.1

Population, 1980-2002

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Source: Bureau of Statistics

Tenure Status of Dwellings

The concept of land tenure as it relates to households and as used in the census, refers to the legal and financial arrangements under which households occupy living quarters. It does not refer to the legal or other arrangements surrounding the occupancy of the land upon which dwellings have been constructed. While the proportion of households owning their homes increased from 1980 to 1991, it remained steady between 1991 and 2002. This may be because the increases in 2002 in the number of squatters and the number of rent-free households were offset by a decrease in the proportion of rented private dwellings.

Table 2.2

Dwellings, 1980-2002

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Source: Bureau of Statistics


Safe water in Guyana comes from two primary sources: treated tap water from ground water and surface water, and bottled water. Huge investments in the water sector over the past 12 years resulted in over 74 percent of the population having access to safe drinking water in 20021. This represents an improvement of 24 percent over the preceding decade. The national averages over the period mirrored improvements in the regions. Specifically, Regions 3, 4, 5, 6, and 10 exceeded the national average while the interior or hinterland regions, on account of the difficult terrain, showed only modest improvements. Region 8 remains the area where access to safe drinking water is most problematic.

Table 2.3

Safe Water, 1990 and 2002

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Source-Bureau of Statistics


Improved sanitation facilities are defined as linkage to the sewer system or to a septic tank or cesspit. There is a positive trend at the national level, with the number of households with improved sanitation increasing from 31% in 1991 to 40.1% in 2002.2 The rise in the national average, however, masks serious shortcomings in several regions. Regions 1, 8, and 9 have the lowest concentration of septic tanks and are way below the national average, whereas Regions 2, 4 and 10 exceed the national average. Region 4 is, by far, the area with the highest connectivity to sewer, septic tank or cesspit.

Table 2.4

Access to Improved Sanitation by Region, 1991-2002

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Source: Bureau of Statistics

Improvement in access to waste collection and disposal facilities is also evident in 2002, with census data indicating that 22% of households benefit from waste collection services, although the burning of rubbish continues to be the most utilized and most expedient method of getting rid of waste for 67% of households.


The main source of lighting for over 69% of households nationally is electricity—not only are these households connected to GPL service but they utilize it more frequently than other options. About 25% of the population, however, is still reliant on kerosene lamps and self-generated power, particularly in Regions 1, 7, 8, 9 and 10


The table below shows a fairly consistent increase in the highest level of education attained by region, from 1991 to 2002. It is clear that access has a significant effect on rates of educational attainment, and the number of persons indicating university/tertiary-level education is lowest in the hinterland regions. At the national level, this increase is most marked at the university/tertiary level and at the secondary level. The comparatively high levels of population with secondary education in Region 4 can possibly be explained by the high concentration of secondary schools relative to other regions and the consequent greater access to secondary education.

At the national level and for almost all the regions, gross enrolment rates exceed 100%. This is because some of the children enrolled at this level are not of the requisite age (between 6 and 11). This happens when children begin primary school at younger ages than stipulated and when children enter primary school at older ages, and remain in school when they are older than 11. In addition, repetition rates may account for higher enrolment ratios. Enrolment ratios at the secondary level also show marked improvement over the last 20 years. Nationally, secondary enrolment ratios rose from 54.5 percent to 65 percent. All regions registered gains in enrolment ratios over the last 20 years although the hinterland regions continue to fall short of the national average. In part, the difficult terrain, population size and the harsh living conditions present serious challenges to physical infrastructure and to recruiting and retaining teachers.

Table 2.5

Highest Level of Education by Region, 1990-2002

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Source: Bureau of Statistics
Table 2.6

Primary& Secondary Enrolment Ratios, 1980-2002

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Source: Bureau of Statistics
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The crude birth rate represents the total number of live births per 1,000. This indicator is closely linked to the age structure of the population, and will be higher in populations where more of the women are of childbearing age (15-49). It is this linkage that most probably best explains the slight decrease in the crude birth rate from 25.19 in 1991 to 23.29 in 2002. Indeed, concomitant population figures indicate a decline in the proportion of the female population between the ages of 15 and 64 from 31.11% in 1991 to 29.94% in 2002, and an increase in the proportion of women of non-childbearing age (1to14 and older than 65). The increase in the crude death rate may similarly be explained by the aging of the population, with 3.92% over 65 in 1991 and 4.27% over 65 in 2002.

Table 2.7

Key Health Indicators, 1980-2002

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Source: Bureau of Statistics and Ministry of Health

The infant and maternal mortality and the crude birth and death rates are all dependent on registration habits, a factor that may be especially meaningful in rural communities and for low-income and/or adolescent persons. Both infant and maternal mortality rates declined over the period, with a particularly significant drop in infant mortality between 1991 and 2002. This decrease cannot be attributed entirely to a declining birth rate, and must therefore reflect improved quality of care for expectant mothers and babies.

Another interesting trend in the health sector is the steady rise in the doctor/patient ratio over the last 20 years. The establishment of the medical school at the University of Guyana and the influx of specialized doctors from other countries through bilateral arrangements, may account for this outcome. Even so, the rate of 200 patients per doctor is still too high. The fact that over 80 percent of these doctors are located in Region 4 raises serious issues of quality of care and access to doctors, especially in hinterland regions. Another troubling issue is the low nurse to patient ratio, which among many factors may be attributed to the migration of health professionals to the Caribbean, North America and the United Kingdom. Bed to patient ratios, which declined precipitously between 1980 and 1991, are recovering as a result of the establishment of several private hospitals and the expansion of government hospitals over the last ten years.

Labour Force Participation

The figures show a steady increase in the numbers of the male and female populations active in the labour force. In 1980, about 85 percent of male and 26.1% of female adult populations were economically active. In 1991, males were still more economically active than females, although these proportions declined to 74.4% for males and 25.1% for females. Higher economic activity rates for men relative to women are the norm for most populations and reflect the traditional division of labour between men and women, in which the livelihood and economic support of the family is regarded as the male responsibility, while women are more engaged in homemaking and the nurturing of children. Significantly, between 1991 and 2002, there is an 18 percent increase in the number of women working, while there is a decrease of about 22 percent in the number of women engaged in home duties. The implications for policy formulation in human services could mean increased demand for childcare services and other child related programmes.

Table 2.8

Principle Activity of Population 15 Years and Older by Sex, 1980-2002

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Source: Bureau of Statistics.

Poverty and Vulnerability

Poverty is often correlated with vulnerability and social exclusion. Some groups may be at risk because of inherent vulnerabilities such as gender, ethnicity, or other factors such as disability, class, region of residence and family configuration. Furthermore, certain combinations of vulnerability may be strongly correlated with poverty, such as living in remote and isolated regions or female-headed households. The high degree of correlation between certain combinations of vulnerabilities and poverty is increasingly leading development practitioners towards using the former as proxies for poverty, and to develop poverty reduction policies that specifically target these most vulnerable groups.

Without seeking to prioritize the needs of certain groups above others and recognizing that there remains a great deal to be done to address the nexus between poverty and vulnerability, this section highlights some of the particular problems associated with three factors: disability, rural isolation, and HIV/AIDS, and some measures that the Government has taken to address these.


Data pertaining to persons with disabilities is largely non-existent in Guyana. Estimates from the Pan American Health Organization placed the number of persons with disabilities in Guyana in 1993 at 71,800, and based on the 1991 census, the percentage of the population living with disabilities was then 9 percent. The 2002 census was the first to include specific questions in this area, and provides the most recent estimation of prevalence of disability in Guyana, with 6.7 percent of the population reporting a disability.

Persons with disabilities are often the most disadvantaged of all groups in society. Many do not have access to education and employment, which can lead to social and economic exclusion. The situation confronting most people with disabilities in Guyana is one of limited opportunities, limited access to basic social services, lack of programmes, negative social treatment and inability to participate fully in society. Services and facilities are typically inadequate, non-existent or provided on an ad hoc basis.

Efforts to mitigate the situation have resulted in the National Policy on Rights of People with Disabilities, which provides for the establishment of a National Commission on Disability (NCD). The NCD was officially launched in December 1997. Its primary functions are to develop and implement programmes to ensure the equalization of opportunities within the framework of the National Policy; advise the government on all issues relating to people with disabilities; and monitor the implementation of the policy. It collaborates with the Ministries of Health, Education, and Labour, Human Services and Social Security, and networks with international disability organizations, the private sector and the Labour Movement. At present, the NCD is undertaking a survey of 1,500 persons with disabilities across four regions in Guyana (4, 6, 7, & 9). The survey is intended to study the characteristics, attitudes, perceptions and needs of persons with disabilities in selected communities. A key activity of the NCD in 2005 is the drafting of legislation to protect the rights of persons in Guyana. The legislation is based upon the National Policy for persons with disabilities, established in 1997. The draft legislation will be presented for Cabinet approval by end 2005.

Geographic Distribution of Access

The provision of social services and the generation of economic opportunity in rural and isolated communities present unique challenges in Guyana. The census figures clearly reveal that the basic needs of communities in hinterland regions are not yet being adequately realized. Rural regions, for instance, have lower percentages than coastal regions of households with access to improved sanitation, and residents in Regions 1, 8, 9 still rely primarily on rainwater collection and wells for drinking water.

Crucial steps necessary for more equitable geographic development include the development of infrastructure, particularly with regard to communications and access by air, road or boat, and the reform of the local government system. In spite of the prohibitively high cost relative to population numbers, some progress has been made towards improving airstrips, providing boats, increasing the capacity to communicate by radio, and improving the quality of services provided within communities. Line ministries and the BNTF and SIMAP programmes are implementing special intervention strategies with a focus on infrastructure development and access to basic health and education4. The Ministry of Amerindian Affairs has also made significant strides not only in community development but also in supporting and facilitating the empowerment of Amerindian communities.


The rapid spread of HIV/AIDS among the most productive sectors of the Guyanese population has been one of the more daunting challenges facing the nation. In addition to the devastating impact on the lives of infected persons and their families, the deleterious effects of HIV/AIDS on the social and economic fabric of society are by now well understood and documented. Within the past year, the Government has significantly scaled up the scope and intensity of efforts to curtail the spread of HIV/AIDS, and increased capacity to treat and provide care for People Living with HIV/AIDS. These efforts are taking place under the aegis of the Ministry of Health, in partnership with international donors, and international and local NGOs.

Some noteworthy results of the enhanced effort include the expansion of Prevention of Mother to Child Transmission (PMTCT) programmes to all ten administrative regions, and the availability of treatment and care programmes in at least one site in all regions. Improved testing capability, a new public health laboratory, and improved home-based care for HIV+ patients are also critical components of the multi-pronged national approach. In addition, considerable resources have been focused on strategies for prevention and behavioral change communication among young people and other particularly vulnerable groups, including incarcerated populations and the disciplined services. These efforts have seen the HIV prevalence rate among blood donors decline from 0.8% in 2003 and 0.6% in 2004.5

Chapter 3 Review of the Economy, Governance and Institutional and Regulatory Reforms

This chapter reviews Guyana’s progress in meeting its PRSP commitments of generating broad-based economic growth and improving the governance and institutional and regulatory frameworks. It also addresses the following specific areas of intervention: pursuance of prudent macroeconomic policies; policies to support private sector growth and poverty reduction; expansion of the economic base to benefit the poor; restructuring and modernization of the traditional sector; development of new sectors to support growth; good governance; and legislative, institutional and regulatory reforms. For ease of presentation and analysis, the planned actions and implementation outcomes and achievements in 2004 as set out in the last Progress Report, are captured in Annex 1 of the report.

(a) The Macro Economic Framework

Guyana continued to (i) pursue prudent macro economic policies; (ii) manage its external debt situation; and (iii) implement fiscal and monetary reforms.

(a) Prudent Economic Policies

The economy grew at 1.6 percent reversing the negative growth of 2003. Leading this positive growth rate was the expansion in the sugar sector and services. In sugar, favorable weather conditions led to increases in production of 7.6 percent while growth in the construction, transportation and communications sector, and distribution and financial services accounted for 2.3 percent growth. The mining sector contracted by 6.6 percent on account of a steep decline in gold production principally due to the near completion of operations at OMAI. Bauxite output also fell by 12.4 percent, partly attributable to the continued restructuring of Linmine. The manufacturing sector remained flat.

Despite the steep rise in oil prices and its impact on the productive sector and services, the consumer price index registered a growth of 5.5 percent, slightly higher than the 4.9 percent recorded in 2003. On the fiscal front, current revenues rose by 13.8 percent to G$52 billion due largely to increased international tax receipts, the implementation of ongoing tax reforms and growth in direct taxes. On the other hand, current expenditures increased by just under 1 percent. Reduced external interest payments resulting from E-HIPC and the decline in the treasury bill rate contributed to this outcome. Capital expenditure increased by 30 percent to G$22.5 billion, reflecting accelerated implementation of the investment programme. As a result of these developments, the deficit of the non-financial public sector amounted to 4.4 percent of GDP. Complementing the tight fiscal stance was prudent monetary policy, which focused on liquidity management, price stability, private sector credit growth and a responsive exchange rate.

The deficit of the current account of the balance of payments improved from 12.1 percent of GDP in 2003 to 10 percent of GDP in 2004, with increases in imports, particularly of capital and oil, keeping pace with the growth in exports. . Merchandise exports rose by 11.7 percent while the similar growth in reflected a 15 percent rise in the fuel bill and a 19 percent increase in capital and other goods. The capital accounts recorded net inflows of US$56 million due mainly to higher net disbursement of loans and private capital. Even so, the large one-off transaction in the escrow account for Guysuco’s Skeldon factory worsened the overall deficit of the balance of payments. This deficit was financed from reserves of the Bank of Guyana.

Table 3.1:


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Source: PCPMU and Ministry of Finance

(b) Debt Management

Guyana’s debt burden declined in 2004 as eight creditors agreed to cancel 100% of outstanding debt stock. As a result, by end-December 2004, the stock of external debt declined by 1.2% to US$1080 million. Associated with this development, debt service payments fell by 12.2% to US$43.7 million, equivalent to about 10% of exports of goods and on-factor services. This phenomenal decline in the stock of debt is attrible to Guyana’s inclusion and/or qualification as a highly indebted poor country (HIPC).

(c) Fiscal and Monetary Reforms

The Government continued to implement structural reforms to improve its macroeconomic framework and lay the basis for sustained growth. To this end, the Bank of Guyana continued to make substantial progress in banking supervision and prudential regulations. The Financial Institutions Act and the Bank of Guyana Act were amended to strengthen supervision and fiduciary oversight in the financial sector. In addition, the central bank engaged in a number of capacity building exercises, including hosting an anti-money laundering seminar for a wide cross section of stakeholders, bank examiners and inspectors.

The Government also began to implement the Fiscal Management and Accountability Act (FMAA) with the passage of its regulations in December 2004. This Act provides for the regulation of the preparation and execution of the annual budget; the receipt, control and disbursement of public moneys; the accounting for public moneys; and other matters connected with or incidental to the transparent and efficient management of the finances of Guyana. The Integrated Financial Management System (IFMAS) also became operational in January 2004. The IFMAS computerized several aspects of the government accounting function, resulting in more efficient processing and recording of transactions and the generation of timely and accurate financial reporting information. The new system also provides accounting officers and their staff with a modern, practical approach to the management of, and accounting for, government expenditure.

Reforms were also initiated to strengthen the Project Cycle Management System (PCMS). The design of an institutional model for the PCMS was completed, while work to develop the operating procedures and guidelines for the prioritization of projects in the public sector investment programme, was initiated. In addition, a database of projects, including project profiles and relevant information for monitoring and evaluation is being developed. The completion of this project will improve the design, monitoring and evaluation of the public sector investment programme and will advance ongoing efforts to target resources for poverty reduction.

A number of initiatives were also taken to advance tax reforms in 2004. In particular, the Customs Duties (Amendment) Order was issued to minimize discretion in the granting of exemptions. To this end, administrative guidelines and criteria were put in place to aid the granting of exemptions. In addition, in July 2004, the Guyana Revenue Authority (GRA) began the publication of tax exemptions to further improve transparency in the conduct of tax exemptions. In line with this, the Customs (Amendment) Bill was passed. This legislation, which gives effect to the revised Harmonized Commodity Description and Coding System, incorporates amendments made under the Fiscal Enactment Amendment Act, the Customs Duties (Amendment) Order and the decisions of the July Meeting of the Council of Trade and Economic Development (COTED).

Further, the Guyana Revenue Authority (GRA) updated and enhanced systems for registering taxpayers, accounting for revenue collections and controlling refunds. A committee was established to implement the new Taxpayer Identification Number (TIN) system and the operations of the License Revenue Office were computerized. The operations of the Examination and Investigation, Field Audit, Consumption Tax Audit and Post Assessment Verification Units were consolidated into the Audit and Verification Division. It is expected that this will result in more efficient collection of tax arrears.

Under GRA’s anti-corruption programme, a new Internal Affairs Division was mandated to investigate corrupt practices and complaints against employees, and to recommend appropriate disciplinary action. A Monitoring/Surveillance Unit was also established, monitoring officers trained and surveillance equipment installed at the Cheddi Jagan International Airport and Customs Transit Sheds.

Policies, procedures, and systems that were implemented for the administration of the following Acts and Customs Orders include:

  • Fiscal Enactments (Amendment) Act No. 2 of 2003

  • The Customs Duties (Amendment) Order No. 29 of 2003

  • The Customs Duties (Amendment) Order No.2 of 2004

Finally, further steps were taken to increase transparency in public tendering and procurement. To this end, legislation was passed to establish a tribunal to hear appeals to decisions of the Public Procurement Commission (PPC). This paves the way for resolution of grievances of the public when the PPC becomes operational.

Creating Opportunities for Private Sector Growth

The Government took several steps to create opportunities for Private Sector growth and development. Some of these steps included:

(a) Investment Promotion

In spite of political instability, the Government continued its drive to promote private investment. Two approaches were adopted. First, investors were directly approached about business opportunities in Guyana and second, the investment climate was improved through laws and tax reforms that ensure transparency and security for investors. These measures are beginning to work. In 2004, four large investors began the process of establishing projects in the mining and hospitality industries, with estimated costs of over US$800 million. In the mining sector, the Russian Aluminum Company (RUSAL) invested US$20 million in the Bauxite Company of Guyana Incorporated (BCGI). Cambior also signed a contract to enter into a joint partnership with the Government in Linmine, which will result in the injection of nearly US$40 million into the privatized company. Two companies were also in negotiations with the Government to establish five star hotels in Guyana.

On the domestic front, the Institute of Private Enterprise Development (IPED) continued to play a significant role in the development process and in stimulating entrepreneurship. During the year, IPED funded 1,524 loans valued at G$135 million under the Poor Rural Communities Support Services Project (PRCSSP). IPED also saw an increase in the numbers of their hinterland and Amerindian clients. In addition to the Hinterland Thrust, new developments for IPED in 2004 included an initial outreach to younger clients; the promotion of sustainable aquaculture initiatives in the Takatu area in collaboration with SBARAE, a Brazilian NGO; and the provision of skills training to clients.

The EMPRETEC Programme was launched in 2003 to provide a realistic and focused strategy to promote entrepreneurship in order to contribute to the creation of employment and the eradication of poverty. The program is mandated to provide special support to small and medium enterprises and start up entrepreneurs, and to facilitate access to services such as entrepreneurship training, quality management and control, export support services, networking and assistance in fostering business linkages. Since its establishment, the client base has grown to in excess of 200 whose businesses have shown tremendous expansion. The level of business activity among the EMPRETEC entrepreneurs is also sizeable. The EMPRETEC Centre is currently in the process of assessing the full economic impact of the programme over the last two years. However, preliminary estimates indicate an average increase in employment in these businesses of approximately 60%.

(b) Export Promotion

Many initiatives were undertaken in 2004 in support of export promotion. Efforts were made to streamline the Import and Export License application process, including making application forms available on the web. In addition, the Guyana Office for Investment (GoInvest) hosted three Guyana Trade and Investment Expositions in Trinidad, St. Lucia and Barbados. The expositions are part of a series of road shows hosted by Golnvest throughout the Caribbean, to build awareness of export-ready Guyanese products. Golnvest also aims to expand market share and develop new markets through the overseas Guyanese community; to upgrade skills for trade shows; and to promote trade and investment through meetings and joint ventures. The 2004 expositions showcased about 200 companies from a wide range of sectors, with companies in the fresh and processed foods sector being represented by the Guyana Marketing Corporation, and resulted in export opportunities for many of the participating agencies.

(c) Expanding the Economic Base to Benefit the Poor

The Government continued to pursue and support the diversification and development of new activities in order to reduce the economy’s dependence on a few primary commodities and to bolster employment, especially in rural, hinterland, and depressed communities. To this end, the Government has been encouraging medium and large scale operators in the gold mining industry to fill the void that will be created by the closure of OMAI Gold Mines. Vanessa Ventures is conducting tests that may lead to the development of an underground mine to exploit gold reserves. Two other companies, Gold Stone Resources and the Guyana Goldfield are conducting similar explorations.

In the area of petroleum exploration, the Spanish firm, REPSOL, has joined CGX Energy Inc. in search of oil reserves. CGX invested a further US$7.3 million to drill up to five wells in an area where there is a high probability of gas and oil finds. Ground Star Resources Ltd is also examining the feasibility of exploring oil in the Takutu Basin.

Tourism continues to emerge as a promising new growth area, expanding its contribution to national income, foreign exchange earnings and employment generation. In 2004, tourist arrivals broke a ten-year record with numbers of 125,000 and the largest number of cruise ship arrivals.

Restructuring and Modernising the Traditional Sector

Guyana’s traditional sector continues to contribute significantly to growth, job creation and foreign exchange earnings. To sustain these developments in an increasingly competitive global market, the Government is taking several measures to restructure and modernize the sector.


Rural Agriculture

The Government implemented initiatives to support poor rural farmers involved in crop production including rice and sugar. Such support included the rehabilitation of drainage and irrigation schemes, financing through on-lending from IPED, and promotion of microenterprise through financial support for community- based initiatives. In addition, through the Agricultural Support Services Project designed in part to address rural poverty, the Government (i) provided Farmer training in agronomy; (ii) support for the production of pure line seed paddy; (iii) production of improved rice seed to support improved productivity; (iv) established a Pesticides and Toxic Chemicals Laboratory to provide analyses on crop residues to ensure safe levels with relevant environmental data; and (v) provided support for the establishment and maintenance of quality standards. A Veterinary Surveillance laboratory to maintain checks on animal health and disease was also established.

The Sugar Sub-sector

The restructuring and modernization of the sugar sector continues apace. In the sugar sector, the Guyana Sugar Company (Guysuco) continued to implement its shareholders agreement with the Government.

The company continues to reduce its cost of operations with emphasis on containing its wage bill through voluntary attrition, and by keeping wage increases in tandem with inflation. Sugar cane fields are also being developed in the Skeldon area to allow for increased production to support the new factory. Furthermore, incentives are being given to private cane growers to supply Guysuco. This will help reduce overhead and improve the efficiency of the industry. The company has also partially moved from Annual Productivity Incentives (API) to Profitability Incentives. To this end, the new management contract incorporates key features that tie bonuses and other payments to the company’s profitability, cost reductions and productivity indicators such as factory efficiencies.

Guysuco completed all agreements leading to the construction of a new sugar and cogeneration factory at Skeldon. Agreements were signed with the turnkey contractors in July 2004, and the concessional loan facility was extended from the Government of the People’s Republic of China to facilitate the construction of a cogeneration plan. The cogeneration facility will supply 10 megawatts of electric power to the national grid in Berbice. Progress is also being made with the Agricultural Improvement Programme, as evidenced by the increasing trends of sugar production in the Demerara estates.

The Rice Sub-sector

In spite of challenges resulting from increased cost of inputs, drainage and irrigation problems and delayed payment to farmers by some millers, there were significant improvements in the rice industry in 2004. Although there was a reduction in paddy production during the year, exports increased in 2004 to 243,093 tonnes or US$55,066,534.00, the highest export value since 1999. This figure is an indication that the industry is recovering from the decline in export values of the recent past, which were due mainly to difficulties in both the CARICOM and EU markets.

Table 3.2 lists rice statistics for the past six years. Some of the 2004 increase in export volume was due to the increased production in the first quarter of 2004. Some success can also be attributed to the increase in the price during the second crop, with cargo rice increasing from US$208 to US$225 per tonne and white rice moving from US$255 to US$280 per tonne. It is expected that this price trend will continue into 2005.

Table 3.2

Rice Production and Export Statistics 1999-2004

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Source: Guyana Rice Development Board.

Achievements in research in 2004, saw the release of a high yielding and blast resistant variety, G98-135, for cultivation. This variety has the capacity to yield in excess of 36 bags per acre, and at the same time, maintain a milling yield of 55/70. Rice producers also benefited from a reduction in the level of paddy bug infestation in the Autumn Crop 2004, as damaged grain content was reduced from an average of 8-10% for the pervious season to less than 3% for the Autumn Crop. Work has also begun on a “Rice-Fish” cultivation project with assistance from the Food and Agriculture Organisation (FAO), designed to provide additional income to rice farmers.

GRDB’s technology transfer programme provided extension service for rice farmers at several levels. Achievements included the following:

  • one hundred and eighty one (181) Farmers’ Field School (FFS) sessions were held throughout the country, in which one thousand two hundred and forty two (1,242) farmers participated. This is a new method of technology transfer being used by GRDB.

  • twelve (12) field days were held to give farmers the opportunity to assess the performance of the advanced lines on trial

  • 27,125 bags of seed paddy were produced by the Research Station for sale to farmers, eight hundred (800) of which were distributed free to farmers provide to assistance due to crop losses as a result of adverse weather conditions

  • nine (9) consultations were held with farmers and millers to address concerns that arose during the purchasing of paddy

  • GRDB, assisted by staff from the Rice Producers’ Association (RPA), intensified the monitoring of rice mills during the purchasing of paddy. Officials of GRDB were stationed full time at some mills during purchasing, to ensure fair practice in the trading of paddy

  • Six (6) training courses on “Paddy Grading and Warehouse Management.” were conducted by GRDB

  • GRDB in collaboration with the Guyana National Bureau of Standards (GNBS) intensified the monitoring of scales used in the weighing of paddy, and conducted three demonstrations to assist farmers in the use of the mechanical and electronic bulk scales.

Guyana’s main rice markets continue to be the European Union (EU) and CARICOM but in 2004, sales of rice to non-traditional markets, including Brazil, Peru, Dominican Republic and Haiti, increased.

Support for the non-sugar and non-rice agriculture sector resulted in the fostering of the growth of domestic markets for local produce and the expansion of extension services to support small-scale agriculture. To this end, the Ministry of Agriculture provided extension services to farmers and the New Guyana Marketing Corporation (NGMC) facilitated marketing services to agro-processors and exporters of products within the non-traditional sector. Further, NGMC provided technical advice and training to farmers, agro-processors and exporters and established a pack house to facilitate the processing of fresh produce for the Caribbean market, primarily for produce destined to Barbados, Antigua and St. Lucia.

The Fishery and Livestock Sub-sectors

Special emphasis was also placed on improving productivity in the fishery and livestock sectors. Significant progress in the areas of aquaculture and marine fisheries resulted in the aquaculture fish stations at Mon Repos and Anna Regina producing a steady supply of fingerlings, some of which were distributed to farmers in the respective regions. An FAO project on Integrated Fish Farming in Region 6 has been progressing well. With respect to marine fisheries, the Fisheries Department has been coordinating with the Caribbean Regional Fisheries Management (CRFM) to carry out assessments on three (3) species of great economic importance: seabob, sea trout and red snapper.

As of December 2004, the National Dairy Development Programme (NDDP) had established over 1,044 acres of pasture benefiting more than 70 farmers, and rendered 2,721 inseminations to improve the national herd. In addition, as part of its assistance with technological transfer, the NDDP established feedlots in Regions 4, 5 and 6 with funding from the CDB. These feedlots are to be used as models for individual farmers. The NDDP also improved access to the Caricom market for Guyana beef and in 2004, beef was exported to Grenada. NDDP sought to further strengthen export capabilities by approaching several funding organizations to finance the construction of an abattoir to meet the required standards for the exportation of beef.

In spite of these improvements, the NDDP noted a reduction in the cattle population resulting from a number of factors, including increased enforcement of public health regulations, poor market opportunities, migration and cattle rustling. There is also a shortage of land for cattle rearing purposes and improved pasture establishment, due to competition for the resource for crops and housing.

The Guyana Marketing Corporation highlighted limited capacity as a key challenge to the exportation of non-traditional agricultural produce. In particular, transportation problems, limited air cargo space and a lack of consistency in the quality of some produce, limit the list of admissible products entering the US market. These contribute to a negative perception of Guyanese products in external markets.


Investments in the forestry sector led to the establishment of two new projects-- Karlam Timbers Limited and Caribe Products International--and the expansion of the operations of Barama Timber Company, Demerara Timbers Limited, Tradewind Marine Industries and the Guyana Furniture Manufacturing Company, resulting in the recruitment of new workers into the sector.


As with the sugar industry, the mining sector, and particularly the bauxite sub-sector, is undergoing major restructuring. The private sector companies have now taken over the operations of Guyana’s bauxite mining company, with Omai Bauxite Company (formerly Linmine) already re-employing 575 staff. Omai Bauxite Company has so far invested over US$15 million towards restructuring the company. While OBMI’s efforts will be directed initially towards refractory bauxite production, sufficient resources have been made available by the Government to permit the evaluation of, and supply for, an alumina plant project. Discussions in this regard are underway.

The privatization of Linmine assets through the creation of OBMI has reduced, virtually to zero, the large sums that were being provided to Linmine to finance its operations. However, residual obligations remain to support a Linmine Secretariat and to fund electricity subsidies in the area, even while government works to disengage from a prior arrangement with Linden Power Company. To this end, Omai Services Company is establishing a 15 MW power station to ensure reliable power generation.

Considerable progress was also made towards identifying investors and initiating negotiations for the new alumina plant. In 2004, a Memorandum of Understanding (MOU) was signed with the Russian Aluminum Company (RUSAL) to facilitate a feasibility study of an alumina plant in Linden.

In summary, within the mining sector, the following major projects were completed or initiated in 2004:

  • Canadian International Development Agency (CIDA)-Guyana Environmental Capacity Development Projects for mercury source characterization and miners’ environmental awareness training. These activities will come to a close in mid 2005, but will be extended through the Mining Management Improvement Project

  • Re-vegetation trials for bauxite spoil areas

  • Development of a land management system based on active resource identification, allocation based on merit and tenure holding based on beneficial occupation

  • Identification and mitigation of key issues for pollution reduction

  • Tertiary training for technologists and professionals in geological engineering streamed towards mining, environment, and geology.

In spite of this progress, key challenges remain. These include the need to overcome deeply ingrained habits relating to environmental practices; the need for better physical infrastructure and communications; and the reduction of the impact of health risks endemic to the sector. It is also necessary to develop adequate monitoring and inspectorate mechanism, and to improve technical and professional training and commitment.

Developing New Sectors to Support Growth

In 2004, increased operations and the expansion of many new sectors supported economic growth. Significantly, in the Information and Communications Technology Sector, Golnvest and the Office of the Prime Minister facilitated seven investments resulting in the creation of two hundred and sixty-two new direct jobs. These included two expansion projects by the Guyana Telephone and Telegraph Company (GT&T) and the Nand Persaud International Communications Call Center. Three new projects -- Cel*Star, Broadband and the GuyTech International Call Center initiated operations in 2004.

Institutional and Regulatory Reforms

The Government continued to improve the institutional and regulatory frameworks with a view to enhancing the business environment for private sector investment and sustained growth. Key reforms were implemented in the areas of legislation, public sector reform, land development and allocation, public accountability, governance and crime.

(i) Reforms to Enhance the Business Environment

  • The Government implemented an ambitious legislative and regulatory reform agenda to advance its support for economic growth. The Ministry of Tourism, Industry and Commerce recently drafted the Competition and Fair Trading Bill, which will be laid before Parliament in June 2005. The objective of the Competition and Fair Trading Bill are to: (a) promote, maintain, and encourage competition and enhance economic efficiency in production, trade, and commerce; (b) prohibit anti-competitive business conduct which prevents, restricts or distorts competition or constitutes the abuse of a dominant position in the market; and (c) promote the welfare and interests of consumers. The Bill establishes a national Competition Commission that shall carry out the functions necessary to give effect to the Bill, granting it the power to investigate potential abuses, prohibit anti-competitive agreements or activities, and levy fines. The Bill also grants powers of investigation and sanction to the CARICOM Regional Community Competition Commission, which shall be authorised to act with regard to cross-border competition issues, as described in Article 174 of the Revised Treaty of Chaguaramas.

  • In addition, private sector commercial activity continues to be facilitated through the processing of trade licenses, efforts to address Caricom Common External Tariff waiver requests and assess local impacts of external trade policies.

  • Other important legal and regulatory laws that were passed in 2004 included:

    • the Small Business Act to facilitate the establishment of a small business council, a small business bureau and a small business development fund;

    • the Investment Act to stimulate the socio-economic development of Guyana and to attract and facilitate investment;

    • the Technical and Vocational Education and Training Act; and

    • the Bill to Combat Trafficking in Persons.

  • Within the mining sector, a complete redrafting of the Mining Regulations took place in 2004. Mine Safety and Health Regulations were also drafted via the Ministry of Labour and Social Security and the International Labour Organization, and await final inter-agency review.

  • Substantial progress was made by the Guyana National Bureau of Standards (GNBS) in developing, implementing and coordinating several reforms to improve product quality for domestic consumption and exportation in 2004. To this end, GNBS, in collaboration with the Caribbean Programme for Economic Competitiveness, progressed in its efforts to have eight Guyanese companies certified to the ISO 9001 Quality Management Standard. The companies include Guysuco, the Guyana National Shipping Corporation, the Guyana National Industrial Corporation, and Guyana Stockfeeds Inc. To safeguard consumers’ rights and equity in trade, GNBS carried out widespread accuracy verification of commercial scales, measures, meters and pumps, as well as surveillance at markets and businesses to ensure that all devices used in commerce are tested and stamped.

  • The operations of the jewellery industry were enhanced with six workshops, including training on marketing requirements for gold jewellery, the testing of gold samples, and the certification of two establishments. Ninety-eight importers were registered for the importation and retailing of commodities monitored by the GNBS.

  • Eight sector committees of the National Committee on Conformity Assessment were established and a plan of action was developed for the establishment of a National Conformity Assessment System. Twelve Guyana Standards covering a range of subjects, including brewery products, carbonated beverages, and occupational health and safety, have been formulated and published. Two Caricom Standards for the Specification of Rum and the Specification for Labelling of Brewery Products were adopted as national standards. Three laboratories in Guyana developed their laboratory management system to meet the requirements of the ISO 17025 standard for accreditation.

(ii) Land Development and Allocation

  • The Guyana Lands and Surveys Commission is responsible for the management of public lands in Guyana, including leasing and other forms of titling of public lands and undertaking surveys required for titling. Its mandate also encompasses the development of land policy and land use plans. These are important elements in the PRSP, which sets targets with respect to issuance of land titles, surveys, and the financial sustainability of the operations of the Commission.

  • With respect to land titling, the Commission has computerized the application and lease issuance processes, allowing for monitoring, evaluation and the disaggregation of applications and titles issued. The parcel database has also been computerized using the geographic information systems software ARCVIEW. This enables the monitoring of leases on the ground on a parcel-by-parcel basis. The Commission’s financial sustainability function was also automated using ACCPAC, allowing for networking between the finance and lease issuance divisions through the rent portfolio, as well as the tracking of revenues against costs. Work to computerize the Land Registry records will be completed by the end of 2005.

  • The Commission tenured leases and titles for 5900 parcels of land in 2004, and titles were registered for more than 200 urban parcels. The Commission is also on target to meet its goal to reduce the time for Land Registry Transfers by private landowners, by the end of 2005.

  • Associated with reforms ongoing at the GLSC, significant progress was made towards strengthening the Deeds Registry through enhancement of its physical structure and IT capabilities, the training of staff, and the identification and revision of laws and procedural aspects of laws necessary to facilitate more efficient functioning of the Registry. The Deeds Registry is charged with establishing an improved system to process transports, mortgages, intellectual property rights, business names, companies, trade unions and related matters, in a timely manner.

(iii) Public Accountability and Governance

  • In 2004, the Parliament of Guyana took measures to create a unified platform to increase its oversight of the Executive for better decision-making on national issues. Additional Parliamentary Committees were appointed and established for: Assembly; Standing Orders; Social Services; Foreign Relations; Economic Services; Natural Resources; Appointment of Constitutional Commissions; Constitutional Reform; Privileges; Public Accounts; Selection; and Management. Oversight functions were reposed in the four Sector Committees namely Natural Resources, Economic Services, Foreign Relations and Social Services. Terms of reference of the committees are being developed and so are the rules of engagement. The main objectives of the Sectoral Committees are to:

    • summon persons to provide evidence and to scrutinize Government documents and records;

    • review the programmes and projects undertaken by the Executive, and agreed and arranged by the committees;

    • utilize the advisory services of experts in the discharge of their mandates; and

    • submit periodic reports to the National Assembly on the status of their work.

  • On the commitment by Parliament to put measures in place for the strengthening of institutional capacity and the functional operations of the National Assembly, the Commonwealth Parliamentary Association provided a consultant to work directly with and provide advice to the Speaker and Clerk of the National Assembly. Steps were also taken to engage the services of specialists and other sources of advice for the Sector Committees. In addition, UNDP facilitated the construction, furnishing and equipping of an Information Technology Centre in the Public Buildings. Finally, the Ministry of Finance developed internal control of expenditures with the installation and implementation of the Integrated Financial Management Systems (IFMAS).

(iv) Local Government

  • In 2004, efforts continued to be made to promote capacity building and institutional strengthening within the local government system, with the Ministry of Local Government responsible for overseeing, coordinating and ensuring local government organs’ conformity to the laws of Guyana and the policies of the Government. The Ministry’s 2004-2007 work programme included the dissemination of national policies for implementation by the Regional and Local Government Administrations, and the provision of technical advice and guidance to ensure compliance with the laws that govern these entities. Within the 10 Administrative Regions, the Ministry is responsible for the rehabilitation, maintenance and construction of roads, bridges, drainage and irrigation, power generation and other infrastructural works. The Ministry is also charged with monitoring two projects: Phase II of the Urban Development Programme and the Municipal Solid Waste Disposal Programme.

  • Progress in 2004 included the establishment and incorporation of the Municipal Services Department into the Ministry of Local Government and Regional Development. The Department oversees maintenance and development of infrastructure within the six municipalities. The Ministry coordinated and implemented activities under the Guyana Municipal Governance and Management Programme, a five-year project to strengthen local governance and management within the municipalities of Guyana.

  • In an effort to improve accountability, eight Regional Development Officers were appointed to monitor and evaluate capital works contracts within the various Regional Democratic Councils. These Officers, however, require the requisite training to ensure the efficient and effective delivery of goods and services. The Ministry’s capacity for data collection was also enhanced by the acquisition of seven computers in 2004. In spite of such progress, the work of the Ministry continues to be hampered by resource constraints, including inadequate staffing and a lack of equipment such as computers and printers.

(v) Decentralisation of Public Services

  • In the 2004 PRS Progress Report, the government committed itself to decentralising basic services to the Administrative Regions, particularly with regard to the issuance of birth and death certificates, passports, house lots and land titles, and the processing and facilitation of exports. The Ministry of Home Affairs has since established branches of the General Registrar’s Office in New Amsterdam and Anna Regina for the issuance of birth and death certificates, and the issuance of passports is now the responsibility of the Immigration Units within the Police Division of these two counties. In addition, the General Registrar’s Office in collaboration with the Ministry of Amerindian Affairs also undertook an outreach exercise to Regions 1, 8 and 10 to register persons and issue birth certificates for hinterland communities. Collaboration with the Geology and Mines Commission (GGMC) has also resulted in the registration and issuance of work permits to foreign miners working illegally in Guyana’s hinterland.

  • The Ministry of Home Affairs has identified Information Technology as a tool to improve administrative and operational efficiency in the six departments under its portfolio. The first phase of computerisation is complete, including a survey funded by the Caribbean Development Bank (CDB) and conducted by International Business Machines, which examined the structure, function, operational systems and the medium and long term IT goals of the departments. The reports emanating from the surveys included recommendations for achieving the technological goals of the departments. The second phase of this project will see the acquisition and installation of IT systems, the training of local personnel and on-going maintenance.

(vi) Justice System and Crime Prevention

  • The Guyana Prison Service is implementing its 2001-2011 Strategic Plan, which prioritises the use of Information Technology to improve its administrative and operational efficiency. Because of its high population density and sometimes unsanitary conditions, the prison environment is one that facilitates the transmission of infectious diseases not only within the institution but also in linked communities. The health of prisoners and the prison environment was therefore given high priority in 2004. In particular, prophylactics for malaria, filaria, small pox and other infectious diseases were administered to inmates on admission to the five prisons. In addition, professional nurses were engaged, staff trained and medical supplies procured to bolster these efforts. Health education for staff and inmates is ongoing, and an important component of this programmes focuses on HIV/AIDS.

  • Included in the Guyana Prison Serv-ice Strategic Development Plan 2001-2011 is the reorganization and expansion of priso-ner retraining programmes to develop basic literacy and mathematical skills. A parallel curriculum provides practical training in high-demand sectors. These are remedial programmes meant to reduce the likelihood that ex-inmates will return to crime and to develop their capacity to contribute to their families and comm.-unities.

To confront and suppress violent crime in 2004, the Government of Guyana, through budgetary allocations, provided the Guyana Police Force with the manpower and equipment necessary to improve the organisation’s operational capacity. Several police stations were repaired and/or fortified, and a new station is under construction in Sophia.

Table 3.3:


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Source: Ministry of Home Affairs

Under the aegis of a new Commissioner, the Police Force is now better equipped to confront the challenges of national security. While gains made over previous years were consolidated, efforts continued to be made in improving the image of the Force. In spite of this, major challenges remain with regard to financial and human resources.

Other reforms articulated in the Crime Action Plan of the Forces’ Strategic Development Plan 2002-2006 which were implemented in 2004 included:

  • (a) promoting and facilitating community policing;

  • (b) creating a legal framework for the protection and operation of persons involved in community policing;

  • (c) enhancing the ability of detectives to conduct criminal investigations;

  • (d) developing an intelligence-led policing style and improving the quality of patrolling; and

  • (e) providing a more efficient police prosecution system in the courts.

These measures have yielded some progress, with murder and robbery with aggravation declining for the period under review. Table 3.3 above provides a summary of violent crimes over the last four years.

The Disciplined Forces Commission

The Disciplined Forces Commission established in July 2003 for a period of 6 months, was extended for 3 additional months and concluded in March 2004. The purpose of the Commission was to investigate allegations of police brutality during a period when the country experienced an upsurge of armed robbery, murder, drug-related crime and marco-trafficking. The Disciplined Forces Commission was constituted by the National Assembly to examine matters relating to public welfare, safety, order, defense and security, including the structure and composition of the Disciplined Forces, and to make recommendations to promote their greater efficiency in meeting the needs of the public interest.

The Commission was charged with taking into account the changing nature of crime resulting from increased trafficking of illicit drugs and firearms, backtracking and money laundering; the relevance and recommendations of the International Commission of Jurists with regard to racial imbalance in the Disciplined Forces; terms and conditions of employment, remuneration, training, accommodation, criteria for promotion, discipline, equipment and logistical needs; and rules and regulations governing the issuance of firearm licenses. The findings of the Disciplined Forces Commission were presented to Government and put before the National Assembly for discussion at a Parliamentary Sub-Committee on Disciplined Forces. Work is ongoing with respect to examination of recommendations made by the Commission.

The National Assembly has not been able to establish the Human Rights Commission due primarily to the need for approval of membership. Dialogue continues on appointments to the Commission.

Chapter4 Investment in Human and Social Services

Investment in Human Capital

Guyana continues to make strides in developing its human and physical infrastructure. Social sector spending as a share of GDP is perhaps, one of the highest in the Western Hemisphere and in E-HIPC countries. Table 4.1 provides a summary of social sector spending over the period 1997-2004. Social sector spending presents the original HIPC expenditures while total social sector spending includes sectors that were not originally provided for in the original programme.

Table 4.1

Guyana: Social Sector Spending 1997 - 2004

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Sources: Guyanese Authorities, IMF Publication (EBS/05/5)

Includes SIMAP, BNTF, IFAD Rural Support Project and other poverty related programs

Includes severance payments for civil service reform as well as safety net programs for Linmine workers in 2003.

This is the definition used in the context of the Enhanced HIPC Completion Point. It excludes housing and water and public sector reform

Recurrent expenditures, and in particular, materials and supplies and personal emoluments account for about 60 percent of social sector spending while investment programmes, such as rehabilitation and/or construction of social facilities account for the remainder. Expenditure in the education sector represents about 40 percent of total social sector spending in 2004, poverty alleviation programmes--principally SIMAP and BNTF–account for 23 percent of spending. Housing, water and health make up the remainder. The impact of these programmes is reflected in the PRSP indicators. This chapter reviews the progress made in investments and human and physical infrastructure in 2004.


The PRSP establishes education as a national priority and one of the major components of poverty reduction. Within this framework, education is not only a tool for development and decreasing poverty but increasing the level of formal and non-formal education of the population is a goal in its own right. In keeping with this perspective, the 2003-2007 Strategic Plan for Education reflects the government’s commitment to reducing illiteracy, repetition and dropout rates, increasing secondary school enrolment and improving the quality and relevance of education for all Guyanese. The Ministry of Education’s medium term strategy is clearly outlined in the Strategic Plan and relates specifically to two pillars of the PRSP:

  • investment in human capital with emphasis on basic education and primary health care; and

  • stronger institutions and better governance.

Education sector activities such as school feeding programmes and subsidies to poor and vulnerable children also contribute to the achievement of the PRS pillar of improved safety nets.

Progress in the education sector over the period of review is captured in Table 4.2

Table 4.2:

Key Education Indicators, 2000-2004

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Source: Ministry of Education
(i) Improvement in the Quality of the Delivery of Education
  • An improvement in the quality of the delivery of education, especially in the areas of literacy and numeracy, continued to be the primary objective for the sector, and significant progress was made in achieving indicators set for 2004.

  • The Curriculum Development Unit of the National Centre for Educational Resource Development (NCERD) developed literacy and numeracy standards for Nursery 1 to Grade 2 Primary. These facilitated the development of Indicators/Scope and Sequence charts and curriculum guides, and the development of the Interactive Radio Instruction (IRI) curriculum for mathematics. Curriculum Guides were also developed for Visual Arts (Grades 1 to 11) and Primary Music (Grades 1 to 6). Work is ongoing on the development of similar material for Spanish at the Primary level.

  • A new methodology to improve the teaching of reading was developed, and the first set of Masters trainers and cluster advisors were employed and trained under the Basic Education Access and Management Support (BEAMS) programme. In 2004, twenty lecturers graduated from an innovative programme to provide pedagogical training to instructors of technical and vocational education and training (TVET). The TVET institutions were proactive in improving the quality of their trainees. These institutions now offer remedial classes in English, Mathematics and Reading, and a module on Entrepreneurship. The use of the computer as a teaching/learning tool is also being emphasised by the institutions.

  • The launch of the new literacy and mathematics methodologies were delayed by difficulties in procuring literacy material and radios for the mathematics programme. The programme is, however, being piloted in a number of schools on the coast and in the hinterland. Work on assisting schools with the development of School Improvement Plans (SIP), with improved delivery of the curriculum as a priority, is going slower than anticipated with fewer than fifty percent of schools having completed SIPs and a much smaller proportion (fewer than twenty percent) having been approved.

  • Under this strategic objective, the development and ongoing implementation of a national awareness programme to the new approaches will be ongoing throughout the planned period. A commission to advise the Ministry on curriculum reform was also established in 2004.

(ii) Teacher Training
  • Improving the quality of staff remains a priority for the education sector. A Council for Teacher Education was tasked with better coordinating programmes of teacher training at the Cyril Potter College of Education (CPCE) and the University of Guyana.

  • The NCERD programme to train head teachers and other senior administrators was also successful, with 201 persons graduating in 2004. CPCE is now delivering the Teacher Training Certificate programme by distance education to two hinterland regions, Regions 1 & 9. Ninety-six teachers are currently enrolled in the programme.

  • Data from the ten administrative regions shows that the proportion of trained teachers at the nursery level grew from 40 percent to 46 percent over a three-year period. However, it should be noted that the number of students at this level in public schools continues to decline and as a consequence, the teaching force has been reduced. While there has been some increase in the number of students in private nursery establishments, this does not fully explain the decline in public schools, which may be fattributable to a number of factors. There was also a slight decline of about 1 percent in the proportion of trained teachers at the primary level in spite of an increase in the numbers being trained, suggesting a higher attrition rate and/or migration of teachers than in previous years. It is not surprising that the largest decline in trained teachers (about 6%) has been at the secondary level, as their superior academic qualifications make them more marketable both within and outside of Guyana.

(iii) Improving Equity in the Education Sector
  • Significant progress has been made over the last two years in increasing the number of students who are in General Secondary Schools and who have an opportunity to take Secondary School Certificate Examination of CXC. The number of Primary Tops was reduced by thirty-five and the number of Community High Schools by three, while the number of General Secondary Schools was increased by six. The construction, extension and repair of other secondary schools under the civil works component of the BEAMS programme, will increase the number of students who will benefit from a general secondary education programme.

  • The Basic Competency Certificate Programme (BCCP), an alternative pathway for secondary students including those with high academic qualifications and an interest in technical subjects, was launched in six pilot schools in January 2004. However, difficulties in accessing funding resulted in a reduction in the number of workshops planned to introduce teachers to the new programme.

  • In the area of Special Needs Education, the Organisation of American States (OAS) is supporting the project “Meeting Special Needs in the Classroom”, and this has already resulted in the equipping of a special resource unit at the Cyril Potter College of Education (CPCE). A new module on Special Needs Education is in draft form and all teacher trainees will be sensitised on its delivery.

(iv) Increasing the Level of Commitment of Students, Parents and Communities
  • The promotion of greater stakeholder participation in the education process has been a major goal of the Ministry for many years, and efforts to intensify such participation are ongoing. The baseline survey conducted under the BEAMS programme revealed that about 80 percent of schools have Parent Teacher Associations (PTAs), which meet at least once per year. Most regions also have Regional Education Committees, which meet regularly and monitor education activities in the regions.

  • The National Advisory Council on Education (NACE) continued to function in 2004, with some members constituting a Task Force working on recommendations for the New Education Act. However, in spite of Cabinet approval for the establishment of this body more than two years ago, no funds have been made available for it to carry out its mandate.

(v) Strengthening Financial and Management Systems
  • Many of the initiatives to achieve this strategic objective are being carried out under the BEAMS programme. Specialists were placed in key units to assist in recommending reforms for the various departments, and Regional Information Technology Officers were appointed in all regional education departments as well. The Ministry also reviewed policies and set criteria to monitor and assess school effectiveness, order and discipline in education institutions, and contributions to schools by parents/stakeholders. Guidelines to standardise lesson preparation at educational institutions have also been prepared.

(vi) National Assessments
  • The new teaching methodologies for mathematics and literacy emphasise ongoing school-based assessment and the Ministry is therefore implementing national assessments at key stages in its programme. In 2004, a survey of eight of the eleven education districts collected baseline data on the quality of education, including the professional and academic qualifications of staff, the availability of learning/teaching materials, managerial practices, and relationships with the community. The information from this survey will be the basis of judging progress in future years. This exercise will be continued in 2005.


Reforms in the health sector began to take shape in 2004 and will be reflected in a significant way in 2005.

(i) The Legislative Framework
  • The MOH’s 2004 legislative agenda was designed to modernize the sector and to accomplish the following:

    • Amend or replace existing laws and regulations in order to make them applicable to contemporary and emerging situations

    • Introduce new laws and regulations in order to provide a comprehensive and more appropriate legal framework for the sector to effectively function and for reforms to be implemented.

    • Improve the quality of health care and provide greater protection to the public.

  • The Ministry of Health Bill, which seeks to introduce greater accountability and allow the Ministry to regulate various activities within the sector, was finalized after extensive consultation and presented to Parliament in 2004. The Regional Health Authority Bill, intended to assist in the reform of the sector, was also finalized after extensive consultation. This Bill will allow the Ministry to reform regional health services and establish the Regional Health Authorities, as has been done in many countries around the world, in an attempt to modernize the decentralized services and to improve management.

  • A draft Health Promotion and Protection Bill to address public health, environment and sanitation was also completed and will replace the Public Health Ordinance drafted in the 1800s. Public consultation will commence and the Bill will be presented to Parliament by July 2005. The draft Allied (Paramedical) Health Profession Bill was completed. This will permit the regulation of those professions by existing arms-length organizations such as the Medical Council, the Nursing Council, the Dental Council and the Pharmacy Council. This Bill will also help to formalize many professions that deliver health care but do so presently outside the laws in an unregulated manner. The Bill is undergoing consultation and will be presented to Parliament in October 2005. The draft Medical Facilities Licensing Bill was completed in 2004 and is presently undergoing Cabinet sub-committee consideration.

(ii) Human Resource Development
  • Human resource management is critical for the health sector. Major initiatives undertaken in 2004 to address the human resource constraint focused on four areas:

    • Intensifying and increasing training;

    • Retaining staff by creating a more empowering environment;

    • Recruiting personnel from abroad; and

    • Joint technical programmes with other countries, including Cuba, China, India, Israel and Nigeria. Additional technical programmes with Canada, the USA and through UN Volunteers will also be pursued.

  • In spite of these initiatives, there are still many professionals whose employment status remains unclear, too many positions not filled and a continued shortage of certain skills, especially doctors, nurses and dentists.

(a) Doctors
  • At the end of 2004, there were 190 registered doctors, including 11 interns, 13 Chinese and 20 Cuban doctors, working in the public sector. In addition, there are 125 private sector doctors working in Region 4 (102), Region 6 (15), Region 3 (6) and Region 5 (2).

  • Clearly, Region 4 with about 40 percent of the country’s population enjoys the services of more than 70 percent of total doctors available. Regions 1, 5, 7 and 8 have the lowest doctor to population ratio. The concentration of doctors in Region 4 may be attributed to the availability of better medical facilities, better living conditions and higher income levels. The low concentration of doctors in the hinterland regions raises serious concerns in addressing the quality of healthcare in these regions.

Table 4.3:

Doctors in the Public Sector

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Source: Ministry of Health
  • There continues to be unfilled needs for doctors in the health sector as a whole, but particularly with regard to General Medical Officers (GMOs) and consultant level physicians. Significant progress was made in 2004 to address needs in specialist areas but there continues to be slow progress in meeting the need for GMOs, particularly outside of Georgetown. The dependency on Cuban doctors as GMOs in outlying areas is not satisfactory as their terms are limited. While the Cuban Brigade provides an invaluable service, it should not be the primary strategy for meeting Human Resource needs in the health sector. Finally, the placement of doctors in Mabaruma, Lethem, Madhia, Moruca, Kwakwani, Lenora, Fort Wellington and Mahaicony and other cottage hospitals remains a challenge.

    • In spite of constraints, progress was made in 2004 in the following areas:

    • Several specialists were employed in the sector, with numbers at the GPHC now totaling 35. These include Cuban and Chinese consultants who are part of the joint GOG/Cuba and the GOG/China technical cooperation Programs. Among the 35 consultant physicians are 6 new staff members recruited from India and several more specialist doctors are expected from India, Russia and Nigeria in 2005.

    • New GMOs were placed at the GPHC, the Enmore Polyclinic, Mahaicony Hospital and New Amsterdam Hospital.

    • Twenty-five students received scholarships to study medicine in Cuba, bringing the number of students studying medicine in Cuba to 150. The number of students studying medicine at UG is now at 68, and the Government decided in 2004 that the Medical Programme at UG must begin to recruit at least 80% of its students through a Government-sponsored programme in which students will be obligated to serve in various parts of the country for at least five years.

    • The MoH is encouraging doctors to pursue post-graduate studies and in this regard, has been facilitating several initiatives. The Government intensified efforts with several collaborating partners to develop local post-graduate programmes. Significant progress was made in 2004 in Surgery, Internal Medicine and Oncology. Arrangements were completed with the Government of Israel to help develop joint study programs to facilitate post-graduate studies by Guyanese doctors. Further advancements were made in 2004 for the commencement of the post-graduate diploma program in surgery, in collaboration with the University of Toronto and the Canadian Association of Surgeons.

    • The GPHC intensified its efforts in 2004 with regard to Continuing Medical Education in Guyana, hosting twenty-two lectures for private and public sector doctors in a wide range of areas.

    • The Ministry of Health, through the GPHC and with local and international collaborating agencies, continued in 2004 to bring specialists (team and individuals) from various parts of the world to work as mentors in hospitals and clinics. These initiatives are meant to build capacity and to enhance the medical skills of the local doctors.

  • A special course on cervical cancer screening was conducted at the GPHC in preparation for an intensified effort at cervical cancer screening in 2005.

  • 87 doctors and nurses received training in various life support methods organized by the MOH in collaboration with GPHC and with international and local specialists.

(b) Nurses
  • The nursing situation in Guyana remains critical with eighty-eight (88) nurses resigning in 2004. Worse still, not enough nurses are being trained to meet the needs of the health sector, in spite of the expansion in 2004 of training programmes for nursing. The number of nurses in training at this time is 337 with 179 in Georgetown, 77 in New Amsterdam, and 81 in Linden. The following are accomplishments in 2004 to note:

  • A plan to train 500 additional nurses in 2005 was approved by Cabinet and will be implemented in March 2005. The Georgetown Nursing School intake for 2005 will be 260 students, while New Amsterdam and Linden will each take in 120 new students.

  • Changes in the law to address academic and age requirements have been made in order to make the nursing programme more accessible to young men and women across Guyana.

  • A new post-graduate programme in anesthetic nursing was negotiated with HVO, and is scheduled to begin in March 2005 at the New Amsterdam Nursing School. The programme will cater for trained nurses from across Guyana and will greatly enhance operating room capacity.

  • Continuing Nurse Education courses were conducted in collaboration with Davis Memorial Hospital and the General Nursing Council.

(c) Medexes
  • Twenty-five new persons were recruited in 2004 and will undergo 18 months of training in basic medical care. In addition, the MOH, through its Regional Health Services Department began the revision of the Medex Training Curriculum in collaboration with PAHO. The intention is to expand the training period so as to include modules for non-health care personnel to enter the medex training program. At the moment, only nurses or occasionally CHW are recruited into the program but exceptional high school graduates will be permitted to enter into the programme in 2005.

Training was also provided for:

  • 12 dentexes and 16 new community dental therapists

  • 182 microscopists and 12 senior microscopists received international certification in 2004

  • 28 new multipurpose technicians

  • 10 X-ray technicians

  • 19 rehabilitation assistants

  • 10 orthopedic technicians in a new programme conducted by the GPHC

  • 24 community health workers received training in rural midwifery

(iii) Improving and Expanding Health Infrastructure
  • The New Amsterdam Hospital was completed in collaboration with the Japanese Government;

  • The design of a new Public Health Laboratory was completed and funding was secured;

  • An agreement was reached with the Center for Disease Control in the USA to rehabilitate and expand the chest clinic, and to fund the construction of a new GUM Clinic;

  • Operating rooms were commissioned at West Demerara Hospital, and the Lethem Hospital was rehabilitated;

  • An Accident and Emergency Clinic and a new X-ray room were completed in 2004 at the Skeldon Hospital

  • Health Centers and Health Posts were constructed and opened in Regions 4, 6,9 and 10, including a health center at Sophia (Region 4), and health posts at Siparuta (Region 6) and New England (Region 10)

  • The MoH completed 94 contracts in 2004 that enabled various small rehabilitation works to be completed. Among the works completed was the construction of a library facility at the Food and Drug Building.

(iv) Drug Procurement and Distribution
  • Significant progress was made towards the establishment of a system to procure drugs and medical supplies through a single agency, the Materials Management Unit (MMU). This provides for standardization, more effective implementation of the Essential Drug List, cost effectiveness and better accountability and transparency. A new Commodity Distribution and Planning System was also put in place in 2004, with a computerized system at the MMU. Storage facilities were improved through the acquisition of two new refrigerators and the construction of the first phase of a refrigerated vaccine storage bond.

(v) Technological Capacity
  • The sector continues to benefit from investment to improve technology, an important part of delivering quality health service. The following were notable additions in 2004:

    • The addition of two CD4 FACS machines, and a specialized laboratory unit for testing for TB and STIs at the GPHC central laboratory, has already led to improvement in quality of care being offered to PLWHA

  • A new hematology analyzer was acquired for GPHC so that comprehensive differential testing for CBCs (Complete Blood Count) can now be offered. Improved capacity to provide CBC (partial differential blood count) is also now available at New Amsterdam Hospital

  • A new laboratory and equipment as well as x-ray machines were installed at the New Amsterdam Hospital and the Skeldon Hospital.

  • Computerized information system for TB, HIV and Malaria, Materials Management Unit. This will enable more efficient procurement and distribution of drugs and medical supplies

  • An atomic absorption spectrophotometer was installed at the Food and Drug Analyst Department.

  • Communication is to be improved via purchasing of two radio sets for the Maternal and Child Health Department

(iv) Health Promotion
  • A national strategy was developed in 2004 with the goal of empowering communities to take greater responsibility for their health. Major targets for 2004-2008 are workplaces, markets and schools. The formalization of an adolescent and youth health and wellness programme began in 2004.


The key elements of the water programme under the PRSP are to increase access to safe water to over 90 percent of the population, to establish the Guyana Water Inc. (GWI), to streamline activities in the coastal zone with an emphasis on the treatment of raw water, and to implement a comprehensive rehabilitation and maintenance plan.

The Guyana Water Incorporated (GWI) identified the major problem areas that should be addressed in long-term strategic plans and a review of the Georgetown Water and Sewerage Master Plan and other studies have been completed. Since the creation of the GWI, a new department was established to maintain the existing water distribution systems in small towns and communities, to promote the Hinterland Strategy to increase water provision, and to support community involvement in the management, operation and maintenance of the distribution system.

A strategy and programme for the provision of new and improved services in the Hinterland was approved in January 2004. Several rehabilitation projects undertaken in 2004 resulted in the improvement of service to some customers, or in the installation of new service connections to others. Other projects undertaken in various parts of the country (Regions 1, 2, 3, 4, 5, 6, and 10) resulted in improved service for over 40,000 people. This includes Phases 1 and 2 of the Linden Refurbishment Project under which 6,000 people benefited from improved water quality or first-time service provision.

Table 4.4 provides a summary of progress against PRS indicators in the water sector.

Table 4.4:


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Source: Ministry of Housing and Water


Consistent with the objectives of the PRSP, the Central Housing & Planning Authority (CHPA) redefined its policy framework with the specific aims of strengthening shelter and land markets, expediting the divestiture of public land for sound residential settlement, accelerating squatter area regularization where appropriate, relocating squatters from land unsuitable for occupation, advancing the institutional strengthening of the CHPA, developing basic infrastructure in new housing areas, and developing long-term planning towards housing development.

The Ministry of Housing and Water maintained momentum in its efforts to improve the quality of life for low and moderate-income citizens. Required actions elaborated in the PRSP which are currently being pursued by the Ministry include:

  • Verification of the number of residential buildings in new squatter areas through a household data inventory programme to yield a count of the residential buildings and to assist occupants in accessing financial aid once regularisation is complete.

  • Revitalisation by the Squatter Regularisation Department of a number of Community Development Councils (CDCs) and establishment of a total of 18 new CDCs in regions 3, 4, 6 and 10. Neighbourhood Democratic Councils (NDCs) were also recruited to be part of the regularisation process.

  • A consultancy for the Framework for Government Response to Squatting (FGRS) reviewed the penal code on squatting and examined issues of legal compliance.

  • Completion of design layouts and sub-division plans for the minimum standards required for housing development.

  • Computerisation of records in the Land Management Department, allowing for the easy tracking of applications for house lots, minimising the perception of discrimination in house lot allocation and making the system more transparent.

As the CH&PA continues with efforts to establish sustainable human settlements to improve the quality of life for low income earners, some key challenges remain in the following areas:

  • (i) the expansion of Government’s efforts to facilitate increased access to financing by low income groups

  • a. increasing the levels of occupancy in the housing schemes and squatter settlements

  • b. completing the regularization of squatter settlements, including the resolution of disputes

  • c. completing the provision of basic infrastructure in both housing schemes and squatter settlements

The current status of the Land Distribution and Housing Indicators 2001-2004 is shown in Table 4.5 below. The high increase in agricultural leases in 2004 is a result of the completion of the many of the reforms that are being implemented at the GLSC.

Table 4.5:


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Source: Ministry of Housing and Water; GLSC

Social Safety Nets

The Government, through the Ministry of Labour, Human Services and Social Security has been assisting Guyanese across the country who are considered to be living in difficult circumstances. Under the numerous programmes introduced and implemented, the Ministry has rendered technical, financial and other assistance to thousands of persons. An allocation of $34 million was approved by Cabinet to provide school uniforms to children in every region of the country. From this initial allocation, the Ministry’ Difficult Circumstances Department distributed uniforms to 12,164 children and assisted 1,396 persons to set up small businesses. In 2004, Cabinet increased the allocation for the School Uniform Programme to $40 million, of which $20 million was allocated to the Ministry of Amerindian Affairs for children in regions 1, 8, 9 and the riverain communities of region 7. The remaining $20 million was used by the Human Services Ministry to help 13,028 children in all other areas. In 2004, 1,021 persons were also assisted with small grants to develop their entrepreneurial skills.

The Ministry of Labour, Human Services and Social Security (MLHSSS) took steps to strengthen its capacity and improve the implementation of its programmes. The Social Security and Senior Citizens’ Department at the MLHSSS is responsible for administering the two major Safety Net programmes of the Government of Guyana: Old Age Pension and Public Assistance, both of which are financed by budgetary allocations from the central Government. Progress in these areas resulted in a revised draft national policy on the elderly, the processing of water relief for Old Age Pensioners, and the design of a Management Information System under the PSTAC project. Risk and Vulnerability and Programme and Targeting studies were conducted for both programmes.

Within the Probation and Family Welfare Department, the training of new officers and work on establishing a National Child Protection Monitoring Database, was a significant boost. In collaboration with a number of NGOs, a Children and Violence Project was launched through a series of workshops, and a policy document on Orphans and Vulnerable Children was completed. There was a significant increase in the reporting of child abuse in 2004, although it is not clear whether this represents an actual increase in the number of incidents occurring or increased reporting as a result of the work of the Department and other stakeholders. A Labour Market Study was also completed in 2004, and an action plan is being drafted based on recommendations generated in the survey report. These recommendations will seek to provide support to workers affected by sector restructuring.

These achievements were realised in spite of insufficient staff at the Ministry, especially for deployment in remote areas, and a lack of trained staff in Information Technology and social work intervention. The Ministry’s capacity to respond to currently unserved hinterland communities needs to be urgently enhanced.

Social Impact Amelioration Programme (SIMAP)

The current SIMAP III programme aims to improve the living standards and economic opportunities of the poorest and most vulnerable households in Guyana, and to increase the capacity of poor communities to articulate and act upon their priority needs. The programme consists of three components: (a) projects to finance investment in social and economic infrastructure and organizational strengthening in poor communities; (b) community services to finance the provision of selected services to vulnerable groups through NGOs; and (c) institutional strengthening to finance technical assistance and training to SIMAP and other programme participants.

Project implementation was delayed as a result of the need to complete a Rapid Poverty Assessment and Needs Assessment in previously unserved areas by SIMAP. The Assessments identified 195 projects for execution of which 125 have been approved by the Board of Directors and the IDB. Contracts are in place for 47 of these and 16 have been completed. Following feasibility studies conducted by the IDB, SIMAP signed a Memorandum of Understanding with the Guyana Power and Light Company to undertake seven electrification projects. In addition, with the re-launch of its Community Services component in 2004, training is being provided to prospective applicants in preparing project proposals for submission to the agency.

Staffing continues to be an area of grave concern to SIMAP and attempts were made to address a high staff turnover rate by revising the agency’s salary scale. A key area of progress in the operations of SIMAP was the design and implementation of a Monitoring and Evaluation system to produce half yearly reports for long-term strategic planning and for enhancing the day-to-day performance of the agency.

Basic Needs Trust Fund

The focus of the BNTF programme is improving the quality and delivery of social services in poor rural communities. Projects undertaken fall within the following categories:

  • Rehabilitation and construction of schools in rural areas

  • Rehabilitation and construction of hospitals and health centres in rural areas

  • Road improvement

  • Skills training; and

  • the construction of markets.

In 2004, almost 3,000 people benefited from a total of 38 BNTF projects, which were completed in regions 1,2,3,4,5,6, and 10.

The Environment

The National Environmental Action Plan (NEAP) 2001-2004 identified Sustainable Human Development as the cornerstone of the Guyana’s socio-economic programme. The mandate of the EPA is to implement: (i) conservation and sustainable use of biodiversity; (ii) ensure sustainable environmental management; (iii) provide environmental education and awareness; and (iv) provide support systems. Challenges faced by the EPA in 2004 include inadequate funding, difficulties in satisfying donor conditionalities, limited technical expertise, and ineffective coordination among sector agencies.

(i) Conservation and Sustainable Use of Biodiversity
  • A National Bio-safety Framework is being prepared as the Action Plan for ensuring maximum benefit is derived from the potential that biotechnology has to offer. In 2004, the EPA hosted the First National Workshop on Public Awareness and Education Strategies for Bio-Safety and awarded three consultancies to carry out surveys for the National Bio-safety Framework Project.

  • The EPA also began strengthening a regulatory system to access genetic resources and to share any resulting benefits with all parties involved. A proposal to fully examine and prepare policy on access, benefit sharing and Intellectual Property Rights was approved for support by UNDP. A preliminary draft policy document was prepared and Cabinet approved a revised fee structure for biodiversity research.

  • A draft proposal for monitoring forest biodiversity was completed along with a strategy for monitoring biodiversity loss in the natural resource sectors. The EPA was also involved in a number of initiatives and activities aimed at coordinating the sustainable use of biodiversity and a wildlife protection programme. These included the finalization of a Memorandum of Understanding (MoU) between the Office of the President and the Southern Rupununi Conservation Society.

  • A critical function of the EPA is the coordination of a programme for the conservation of biodiversity including National Parks, a National Protected Area System, and a Wildlife Protection Management Programme. Activities in 2004 included capacity building workshops on Management of Protected Areas, Categories of Protected Areas, and Community Resource Evaluation; the completion of technical discussions on the Grant Agreement for the Guyana Protected Area System Project to be funded by the World Bank/ GEF; the signing of a Memorandum of Cooperation (MoC) to establish a Community Conservation Area in Southern Guyana; and continued work towards the establishment of a National System of Protected Areas.

(ii) Environmental Management
  • The EPA reorganized its organizational structure to enhance the work of Quality Control, monitoring and enforcement through the Authorization Unit, to include aspects of Environmental Emergencies and Planning through the Response Unit. Development and research was geared towards the development of guidelines, codes of practice, regulations, standards etc.

  • A mechanism is now in place to direct all facilities requiring licences from the Guyana Forestry Commission and the Guyana Energy Agency to register with the EPA. Successful strategies for enforcement are being implemented resulting in greater environmental compliance by facilities.

(iii) Education Information and Training
  • A National Youth Forum was hosted in collaboration with the Ministry of Health, WWF, EPA, Iwokrama and Peace Corps, to build awareness and knowledge on issues related to population, conservation and ecology. The EPA also sponsored numerous panel discussions on radio and television and a National Capacity Building Workshop on proposal writing was conducted for 75 youth members of Environmental Clubs.

(iv) Support Systems
  • The GIS unit of the EPA is responsible for geographic data management and analysis, and prepared maps for proposed pilot study areas, the incidence of environmental complaints along the coastline of Guyana, proposed sites for hydropower stations, and others as requested by internal and external stakeholders. The GIS unit also continued to assist the CDB-funded Coastal Zone Information Management Project, and provided training to the Guyana Sea Defence Board.

Chapter 5 Infrastructure to Support Growth

The infrastructure strategy detailed in the PRSP is geared towards improving the maintenance of sea defences, roads, air and river transport, and drainage and irrigation systems in order to support private sector and community-based growth.

(i) Sea Defences

  • The Sea and River Defence Division of the Ministry of Public Works and Communication is responsible for the care, construction, maintenance and rehabilitation of all sea and river defences in Guyana. In 2004, civil works on sea defences were carried out along the coastline from Regions 2 to 6. Special attention was afforded to the Profit/Foulis area where 15000 tons of boulders were delivered for emergency works.

  • The Division also undertook a Sea Defence condition survey, which is sixty percent complete. In addition, a Geographical Information System (GIS) Database to incorporate data gathered from surveys carried out by the Division is almost fully developed. Training of local personnel is also ongoing in key areas such as data management (GIS), and the design and maintenance of sea defence structures. These programs are executed under the Division’s Institutional Capacity Building activities within the framework of Shore Zone Management.

(ii) Roads and Bridges

  • In 2004, 68 bridges and culverts were rehabilitated and 26 structures constructed between Timehri and Mahaica. These included construction of the Mahaica-Rosignol road to provide the necessary links for farm-to-market roads and allow for easier transportation of goods. This project is about 76 percent complete. In addition, the overall progress on work on the four-lane highway from the Demerara Harbour Bridge to Ruimveldt was rated at 65 percent complete at the end of 2004. Feasibility studies of the New Amsterdam- Moleson Creek Road and the Southern Entrance to Georgetown were also completed.

  • To sustain the long-term viability of roads, the Ministry of Public Works and Communication continued to execute its Routine Maintenance Management System (RMMS). The Ministry also embarked on a Road Safety programme under the RMMS and works on sidewalks and lighting at intersections along the East Bank Demerara roads have begun.

  • The Demerara Harbour Bridge, a vital link between Regions 3 and 4 that enables transport of agricultural and manufactured goods to and from Georgetown, was also a priority area of focus in 2004. General maintenance of the entire structure was undertaken in accordance with a computerized maintenance and monitoring system developed in 2004. The toll ticket system was also upgraded and construction began on a new building to house the Corporation’s administrative and audit departments.

(iii) River Transport

  • In spite of the challenges faced by the Transport and Harbours Department in the procurement of spare parts and the curtailment of services due to defects in ferries and stellings, five stellings were rehabilitated and seven vessels repaired in 2004.

(iv) Air Transport

  • In the air transport sector, rehabilitation works are ongoing at the Cheddi Jagan International Airport. This includes the maintenance of the Communications, Navigation and Surveillance, and Air Traffic Management Systems as well as improvements in the Airport’s computer networking and emergency systems. A proposal was approved for the development of an Airport Security Programme to strengthen the financial and operational sustainability of the Aviation Security system in Guyana. Based on the certification of rural aerodromes, works were completed on the Annai Airstrip while work continues on the Port Kaituma and Orinduik Airstrips. Challenges faced by the sector in 2004 included the hiring and retention of qualified and experienced aviation personnel.

(v) Drainage and Irrigation

  • In 2004, over $283 million were allocated for maintenance projects and approximately $750 million for capital expenditure in drainage and irrigation. Rehabilitation and maintenance works were completed on dams, drains and canals, and newly constructed structures included a 1900-foot timber revetment and 7 culverts. Two mobile drainage pumps were purchased and installed in order to improve the effectiveness of the D&l system.

(vi) Maritime Affairs

  • Although the Maritime Administration is purely a regulatory agency and does not directly affect Guyana’s Poverty Reduction Strategy, there are indirect impacts. In 2004, international port facility and ship security certificates were issued to 37 port facilities and 25 ships in accordance with the Maritime Administration’s adoption and implementation of the International Ship and Port Facility Security Code (ISPS). Progress in this area is of great importance to the economy since it allows for Guyana’s ships to trade globally and for international ships to be readily received at local port facilities.

  • In keeping with international maritime conventions to which Guyana has acceded, regulations were drafted and approved to give effect to the Caribbean Cargo Ship Safety Code and the Small Commercial Vessel Code. An arrangement was made with the Jamaican Maritime Authority to audit one Maritime Training Institute in Guyana and issue certificates in basic safety courses.

(vii) Unserved Areas Electrification Programme (UAEP)

  • The UAEP aims at strengthening the legal, regulatory and institutional framework and at accelerating electricity sector development in Guyana over the period 2004 to 2009. Specifically, the programme targets electrification of unserved rural areas and hinterland regions. Materials for the infrastructural works to install new connections by GPL were procured and systems designs for Phase 1 of the project were completed in 2004.

Special Intervention Strategies

The Government is committed to reducing pockets of poverty, especially in the bauxite-producing town of Linden and its environs, and in hinterland areas populated largely by Amerindians. In line with this commitment, the Government proposed and implemented a number of special intervention programmes to reduce poverty in Regions 1, 8, 9 and 10.

Hinterland Development

The Ministry of Amerindian Affairs (MOAA) works to provide for the integration of the Amerindian Communities into the wider Guyanese society and to encourage self-sufficiency and economic and social development in the hinterland regions. Because the MOAA collaborates closely with the Ministry of Local Government and Regional Development, these agencies synchronize their work programmes to ensure the most efficient utilization of resources within Amerindian Communities. The Strategic Plan being devised by the MOAA also factors in the continued need to link with other government sectors, funding agencies and NGOs. Joint ventures that were undertaken included the training of 20 Mines Officers, community forestry development, pest treatment, a birth certificate programme benefiting 4,000 people, and an HIV awareness programme.

Further accomplishments in 2004 included:

  • Training in leadership development, including the training of Toshaos as Justices of the Peace and Rural Constables

  • The ongoing execution of the Hinterland Scholarship Programme

  • Draft revision of the Amerindian Act which is now in the final rounds of consultation

  • Land demarcation and surveying exercises for ten communities in Regions 1, 2, 4, 8, 9 and 10. This will eventually result in legal ownership by communities.

  • Construction of seven Village Council offices

  • Acquisition of thirty-four radio sets and accessories for Regions 1, 2, 4, 9 and 10, in an effort to improve communications between communities

  • Distribution of equipment to assist in forestry and agriculture production

  • Distribution of boats and outboard engines to enhance river transportation in Regions 1, 2 and 9

  • Distribution of school uniforms in Regions 1, 7, 8 and 9.

Region 1: Barima -Waini

The development of infrastructure to support growth in Region 1 continued with the rehabilitation of the Port Kaituma and Six Miles to Falls Top Road. Works are currently in progress on the construction of a number of new roads and the maintenance of existing roads. Electricity services in Mabaruma have been extended and the generator in Port Kaituma rehabilitated. The agricultural support base was improved through the construction of revetment at Barabina and the extension of the plant nursery at Hosororo, and the construction of bridges at San Jose and Wauna.

Educational development was boosted through the construction of teachers’ quarters, dormitories, school maintenance, construction and expansion. The Ministry of Amerindian Affairs also provided a boat and engine to the Regional Educational Officer to assist in the transportation of school children. This sector also benefited from 13 SIMAP projects in the region.

In the Health sector, the construction of a Health Centre with living quarters at Eclipse Falls and doctors’ quarters at Port Kaituma were completed and the construction of a Health Hut in Coco, Moruca is in progress. To boost vector control in the region, works are in progress on the Malaria Quarters in Port Kaituma and a boat was acquired for the Vector Control Unit.

In 2004, efforts continued to finalize the granting of a land title to the Baramita Amerindian District, and legislative and financial activities continued towards including Shell Beach within the Guyana Protected Areas System (GPAS).

Region 8: Potaro -Siparuni

In 2004, heavy-duty bridges were constructed at Micobie, Tumong, and Wailingbaru and a pedestrian bridge installed at Kmana. Bridge maintenance and repair took place at Campbelltown, Madhia, the Denham Bridge, and the Bartica/Potaro Road. Several roads were constructed and maintained in key areas of the region. River defences at Tumatumari, Lower Potaro were maintained and extended. These activities aimed to improve access to and between communities, and to facilitate the transportation and marketing of agricultural produce.

With regard to social service provision, focus in 2004 was on improving infrastructure in the education and health sectors. To this end, primary schools, dormitories and teachers’ quarters were constructed and rehabilitated throughout the region, and health posts were constructed and maintained. An X-ray room was added to the Mahdia Hospital, along with an x-ray machine, film processor, solar panels and ambulance.

Region 9: Upper Takatu - Upper Essequibo

The Ministry of Amerindian Affairs provided a rice huller for the village of Karaudanaunau to boost village rice production efforts and, as identified in the 2004 Progress Report, community farms at Awarewaunau and Sand Creek were fenced to separate agriculture farming from cattle rearing. Work also commenced on the rehabilitation of the Veterinary Officers Quarter at St. Ignatius and the agriculture building at Annai.

Significant road network improvements and bridge construction took place in 2004. Other developmental works included the installation of solar systems for power generation; the purchase of water tanks and hand pumps; and the installation of windmills for water supply. In the Health Sector, the renovation and construction of health huts are in progress. Primary schools were constructed and extended with the addition of teachers’ quarters. The 2004 SIMAP programme in Region 9 comprised 12 activities, including the construction of multipurpose, women’s and community centers, and nursery schools.

The process to establish Konashen as a Community Conservation Area was advanced through community consultation and the signing of a Memorandum of Cooperation between the Government of Guyana, Conservation International and the Wai-Wai Community of Konashen.

Region 10: Upper Demerara - Berbice

In 2004, rehabilitation work took place on roads and bridges throughout the region. Drainage and Irrigation activities focused on the desilting of the industrial area drains, Hymara and Cocatara Creek and the clearing of Cocatara Creek crossing. Construction and maintenance work was carried out on schools, and a Health Post at 47 Miles. Solar systems were acquired for the remote communities of Calcuni and St. Lust, Berbice River, to aid power generation to the health facilities and the communities as a whole. In housing, 786 house lots were distributed in Wisroc and the distribution of 1,912 houselots is in progress at Amelia’s Ward based on the established number of vacant lots.

SIMAP activity in the region totaled 13 projects and included the construction and rehabilitation of schools, teachers’ quarters and a day care centre. The Basic Needs Trust Fund also awarded a contract for the rehabilitation of the Kwakwani water supply system.

The Linden Economic Advancement Programme

As part of an effort to realize the significant development potential of Region 10, the Government of Guyana, in partnership with the European Union, established the Linden Economic Advancement Programme (LEAP) to facilitate the economic diversification of the region. An excess of 12 million Euro is expected to be invested in the Region over a 7-year period. LEAP emphasizes investment promotion, the development and expansion of small enterprises. A Business Incubation Centre to support the creation of new micro and small enterprises by providing temporary affordable space, shared office services, management services and marketing assistance advice on access to risk capital, is in development.

A micro-credit scheme—the Linden Economic Advancement Fund (LEAF)—will make available 1.9 million Euro for on lending to micro-businesses and small and medium enterprises in Region 10. LEAF is managed by an independent financial institution, the Guyana Fire Life and General Insurance Company Inc., an established Guyanese financial institution known for it proactive business approach. A credit analyst and support staff for the programme were hired, a building and equipment procured, and an MIS system for LEAF installed. The first tranche of G$60 million was made available for on lending in December 2004.

LEAP also provided technical, vocational and management training programmes, from which three hundred and forty-four persons benefited in 2004. A Youth Entrepreneur Network was launched in 2004 with a public awareness programme geared towards encouraging entrepreneurship as an employment option for young people. Twenty-five members received training in Entrepreneurial Skills Development and Competitive Advantage as well as ongoing technical assistance and business counselling services.

A number of new investments were made during the year in several sectors, including forestry, logging, saw milling, leather craft, and shoe making. An estimated US$1.7 million was invested, creating over 100 jobs. In 2004, an international consultancy carried out a Business Opportunities Survey and a number of Small Business Opportunities Profiles were prepared and will be used to promote new business ideas in the region.

New investments in the region are being promoted nationally and internationally through direct contacts and a rolling public relations and communications programme. During the year, LEAP supported the participation of crafts producers at international trade exhibitions and 9 local businesses were assisted in their participation in GuyExpo. By the end of 2009, it is expected that LEAP will have directly contributed to the creation of 1700 new jobs in Region 10.

Feasibility studies are being carried out to advance the development of an industrial zone and expansion of wharf facilities.


The Progress Report Consultation Process

Public consultations on progress towards the achievement of PRS goals and targets reflect the Government’s continuing commitment to involve key stakeholders, in particular the poor, in the formulation and implementation of policies and programmes designed to reduce poverty. These meetings to receive feedback on poverty programs and inputs in policy formulation have become increasingly familiar to Guyanese since the development of the Poverty Reduction Strategy in 2001, when over 200 public consultations were held throughout the country. Similar exercises also took place during the countrywide review of the 2004 Progress Report, and within the context of the monitoring and evaluation work of PRS Regional Committees. Repeated successes in generating high levels of participation throughout these processes demonstrate the importance citizens attach to the consultation process and the poverty reduction programme.

The consultation process on the 2005 draft Progress Report aimed to (i) disseminate information on progress made towards reducing poverty as elaborated in the previous report and new programmes that will further augment planned actions for poverty reduction; (ii) generate feedback from a cross-section of the population as to whether the poverty programme is having its desired impact; and (iii) provide a forum for civil society to elaborate their priorities and suggest recommended actions.

Regional Consultations

A total of eight regional consultations were held within a period of two weeks. Consultations were held in Regions 1, 2, 4, 6, 7, 8, 9, and 10, with residents of Region 3 participating in the consultation held in Region 2, and residents from Region 5 participating in the one held in Region 6. The programme for the 2005 public consultations incorporated several improvements over those held previously and generated a wealth of information which, in addition to being incorporated into the 2005 Progress Report, can be utilized in sectoral planning.

At each consultation, government ministers and high-level technical officials provided overviews of progress and shortcomings in the implementation of the PRS in 2004. Their presence facilitated the provision of prompt explanations to questions raised by participants. A senior regional official provided an update on achievements and problems in the region during the past year. Members of the Steering Committee and Regional Coordinators also participated in the exercise by presenting an overview of the Progress Report. The primary focus of the consultations was to allow participants the opportunity to comment on the report, with special emphasis on their community or region. Time was allotted in the programme both for a question and answer period and for participants to record their views and priorities in a feedback form that was submitted to the M&E Unit.

Parliamentary Consultations

For the first time in the poverty reduction process, a special consultation was held for Members of Parliament to elicit their feedback on the draft final progress report. The objective of the consultation was to provide Members of Parliament (i) an overview of the 2005 PRS Progress Report; (ii) present the issues and recommendations arising from the public consultations; (iii) indicate to what extent these recommendations were included in the final draft document; and (v) present the risks inherent in the medium-term poverty reduction program.

Dissemination of the Draft Report and Leaflets

Over 500 copies of the draft 2005 PRS Progress Report were widely disseminated to government officials, line ministries, agencies, donor agencies, civil society organizations, the academic community and the private sector. In addition, leaflets covering specific sectors were prepared for dissemination to the wider public via the PRS Regional Committees, the Regional Democratic Councils in all ten Administrative Regions, and at the consultations. The leaflets presented summarized information on progress and plans in key sectors such as education, health, housing, water, governance, and infrastructure. More than 12,000 leaflets were distributed countrywide prior to and during regional consultations.

This year, leaflets were distributed in advance so as to allow civil society, including communities, households and other stakeholders, to carefully review the issues and to provide well-considered feedback to the questions. Through collaboration with the DevNet project, the draft report and leaflets were also made available online at the PRSP website.

Public Awareness

A public awareness campaign promoting the importance of citizen involvement in the consultation process was implemented via the mass media and through the mobilization efforts of the PRS Regional Committees. Press releases were issued to all national and local television and radio stations, as well as newspapers. Daily advertisements also indicated the locations and dates of the consultations. In the week prior to the consultations, government ministers also participated in a live talk show to discuss the Progress Report and plans for the consultations. Through collaboration with the Government Information Agency (GINA), each consultation was recorded and reported on in a number of daily news programmes.

Mobilization efforts within the regions centered on the work of committee members who canvassed their regions, beginning two months in advance of consultations. Committees convened small group discussions on the draft Progress Report and consultation process, and distributed reports, leaflets, flyers, and invitations. The participation of Committee Coordinators in local (regional) television programmes was particularly effective in providing information for residents with limited access to national television channels, such as those in Regions 2, 5, 6, 7 and 10.

Participation and Feedback

Each of the 2005 consultations registered an increase in the number or participants in comparison with the 2004 consultations. More importantly, the geographic representation was much improved, as was the range of local NGOs with which participants were affiliated. Feedback was also received from other stakeholders including the donors, non-governmental organizations, and other recognized groups in civil society. The attendance numbers and local NGO representation by region is presented in Table 6.1 below.

Table 6.1:

Public Consultations, Participants by Regions, 2005

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In addition to participating in the regional consultations, citizens were provided the option of submitting feedback via email or regular mail, or by completing a comprehensive feedback form.

The feedback form was designed in collaboration with key sector ministries, to provide information on citizens’ satisfaction with services provided by the government, as well as priorities and recommendations for action. A copy of the feedback from is found in Appendix D of the report. The feedback form disseminated in the hinterland regions was specially designed to elicit information specific to regional services and issues.

The success of this strategy is particularly evident in the feedback obtained from hinterland regions this year, with over 200 forms collected. In total, 700 forms were collected and analyzed after being inputted into an Access database.

Feedback from Public Consultations

Table 6.2 summarizes the results of the feedback at the national level, along with the major issues and recommendations reported at the regional consultations.

Table 6.2:

National Level Analysis of Feedback Forms by Sector

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Regional analysis of the issues and recommendations are presented in Appendix E. It is interesting to note that while regional priorities do not differ significantly from the national level analysis, the order of importance varies somewhat from region to region, and between easily accessible and more remote areas. The hinterland regions showed more variance both in the sector areas requiring attention and in recommended actions.

Nevertheless, the public consultations provide a wealth of information and priorities identified by stakeholders as requiring urgent attention. Accordingly, to the extent possible, the medium-term poverty reduction programme takes into consideration many of the identified issues and recommendations.

The special consultations with Parliamentarians also provided important feedback. In particular, it helped to (i) expand key areas in the medium term strategy that were not adequately addressed such as tourism and peasant agriculture; (ii) ascertain additional information in terms of the accuracy of the status of the reform agenda and project implementation; and (iii) suggested recommendations for improving future consultations.

Chapter 7 The Poverty Reduction Programme Medium-Term prospects6

The Context

In January 2005, torrential rains and subsequent widespread flooding caused tremendous physical damage to the Guyanese coast along Regions 3, 4, and 5, and resulted in great economic and social loss for the country. The impact of the disaster is expected to have lingering effects on the economy that may undermine its performance during the medium term.

This section of the report assesses the growth prospects, the medium-term investment programme and its consequences on debt sustainability, and the economic challenges facing Guyana in meeting its PRSP objectives and the MDGs. The assessment begins with (i) an evaluation of the key macroeconomic indicators, (ii) debt sustainability challenges in the medium term; and (iii) the investment required to put the economy on a sustainable growth path.

Medium-Term Macroeconomic Outlook

Guyana faces serious challenges in the medium term. First, it has to reverse the negative and/or low growth rates of the last 5 years. Second, it has to complete reconstruction of infrastructure damage caused by the January 2005 flooding, adopt mitigating measures to minimize future impacts of such disasters and restore the productive capacity of the economy. Third, it has to create a business-friendly and politically stable environment that will attract direct foreign investment and stem the migration of its entrepreneurs and professionals. Most significantly, overcoming these challenges is integral to its capacity to meet its poverty reduction and MDG commitments.

Meeting these challenges will not be easy and will involve serious tradeoffs. This is made more difficult by the internecine political differences between the two major parties and the perceived atmosphere of political instability and uncertainty this creates for both foreign and local investors. In addition, Guyana’s debt sustainability commitments under the E-HIPC impose a binding constraint as to the level and type of debt that can be contracted.

It is within this context that Guyana crafted its medium term macroeconomic strategy to address key structural reforms in policy, governance, institutional and regulatory areas and design a public investment framework that would generate quick supply responses in the productive sector and enhance access to basic social services. The projections highlight several important points. First, the prospects for the investments proposed and their impact on poverty reduction indicators ultimately depend on macroeconomic growth patterns in 2005 and beyond–patterns which in turn will be shaped by the policy reforms and disaster reconstruction over the next three years.

Second, if Guyana is to sustain a reasonable rate of growth, substantial external funds will be required. If borrowing is limited to the current HIPC ceilings of debt sustainability under the fiscal criteria, grant resources will be required to finance the reconstruction programme.

The Impact of Guyana’s National Disaster on Poverty

In January 2005, unprecedented rains resulted in extensive flooding across most of Guyana’s coastline, affecting three regions (3,4 and 5) and dislocating 70,000 households. The government, with assistance from the United Nations Economic Commission for Latin America and the Caribbean (UNECLAC), estimated damages in excess of G$93 billion or US$465 million. The impact of the floods reversed GDP growth from 0.4 percent to -2.6 percent. The economic and social damage was extensive, touching virtually all the sectors and severely affecting close to 275,000 persons, or one-third of the population.

In the economic sector, the activities most affected were agriculture, manufacturing, retail trade and distribution. Road networks were damaged in many locations, depleting productive capacity. These roadways, located in heavily populated areas, included 181 miles of farm-to-market and community roads in poor areas. The disaster also highlighted the state of the drainage and irrigation system, which was overwhelmed by the flood. GWI suffered damage to water mains and pipelines, and service was disrupted under the risk of contamination of submerged pipelines.

Many subsistence farmers, small business operators and vendors suffered enduring damage to their livelihoods and encountered severe liquidity constraints due to the closure of their operations. Although official numbers are not available to measure the depth of vulnerability of poor households in Guyana, it can be surmised that many of the low-income households would have fallen deeper in poverty as their resources were redirected from investment activities to maintaining adequate consumption during the affected weeks of the flood.

Donor resources and private inflows for relief operations flowed immediately after the flood and provided key support in mitigating the impact of the disaster particularly for affected households. Not inconsequentially, many households were also able to draw on support through remittances, which helped to alleviate the impact. The government also provided financial and economic relief directly to affected households and small farmers, through direct cash allowances, seed, livestock and other agriculture inputs.

Finally, on the financial front, it is crucial that public consumption be reduced, domestic savings increased and that there is a continued net transfer of external resources into Guyana. Economic policies will be needed to promote appropriate levels of investment in both the public and private sectors. Private and public investments will play a critical role in generating, accelerating and sustaining economic growth. While accommodating policies, legislative and regulatory reforms may encourage private investment; public investment should provide the necessary complementarities required to encourage private sector participation.

The starting point for projections, i.e. the negative GDP growth rate projected in 2005, is a discouraging one, but the groundwork is being laid to stabilize the economy for growth to resume in 2006. To this end, the government will continue to pursue prudent fiscal and monetary policy with the objective of ensuring price and exchange rate stability. In addition, the Government will continue its implementation of fundamental structural and institutional reforms to enhance the business environment and expeditious restoration of the country’s productive capacity and so provide for accelerated growth beyond 2007.

Table 7.1:


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Source: Ministry of Finance, Bank of Guyana, Bureau of Statistic and PCPMU projections

The projections presented in Table 7.1 above are based on a set of cautiously optimistic assumptions and represent, in the Government’s view, sustainable prospects in the real sector and investment levels geared to augment private sector activities. Specifically, the projections assume (i) mobilization of external resources, both loans and grants, through reprogramming of Guyana’s existing loan portfolio with the International Financial Institutions (IFIs); (ii) restoration of the productive capacity within three years; (iii) completion of the Skeldon Sugar and Cogeneration factory in 2007; (iv) introduction of VAT and other fiscal reforms and their impact on revenues; and (iv) an improved business and political environments that will spur private sector investment..

Under these assumptions, the economy is expected to reverse the negative growth rate of -2.6 percent in 2005 to reach an average growth path of 2.8 percent 2006-2009. The negative growth rate in 2005 reflects the expected economic fallout from the national disaster that struck Guyana in January 2005. The recovery program will be completed in 2006 and this is expected to put the economy back on a positive growth path with sugar, bauxite and services leading the growth process.

External Borrowing and Debt Sustainability

Borrowing decisions for investments in the poverty strategy will clearly have implications for the sustainability of Guyana’s debt stock. The relevant measure of debt sustainability for Guyana is the ratio of the Net Present Value of External Debt to Government Revenue. On present assumptions, this ratio is projected to peak at 258% in 2007, above the IMF/World Bank ceiling for debt sustainability set at 250% for Guyana. The baseline case, as well as some options for improving prospects for debt sustainability, is presented in the charts below.

The possibility of 100% grant financing from IDA in the future, under the IDA14 allocation mechanism, improves prospects for debt sustainability. Equally, the possibility of all countries joining the UK’s initiative to cover Guyana’s debt service to IDA until 2014 is beneficial to debt sustainability, but still leaves the peak precariously close to the threshold.

The two options, which have the greatest effect, bringing the baseline case to around the threshold of 250%, relate to borrowing from the IDB and the IMF. In one scenario, the IDB adopts an IDA14 style allocation of grants from 2006. The example presented here involves 50% of the projected IDB disbursements in 2006/7 being provided as grants. The second scenario presents the effect on debt sustainability of not making any further disbursements under the IMF’s PRGF. Both scenarios have a significant impact on debt sustainability. The recent pronouncement of debt relief from the G-8 has not been included in the analysis as details are not available.

Revenue from the non-financial public sector is projected to be strong in the medium term on account of the fiscal measures and reforms currently under implementation. Total public revenue (including the net current balance of public enterprises) is projected to average 38.2 percent of GDP over the medium term. Central Government expenditures, on the other hand, are projected to rise to 53 percent of GDP in 2005 before declining steadily to reach 48 percent of GDP by 2009. Disaster recovery and reconstruction and the construction of the Guysuco Skeldon factory account for the steep rise in expenditures between 2005-2007 to an average of 52 percent of GDP during those years. The overall non-financial public sector deficit is projected to rise sharply to 15.1 percent of GDP in 2005, then to 16.9 percent of GDP in 2006 before declining precipitously over the next three years to reach 6.6 percent of GDP by 2009.

The external account is projected to register steep declines, particularly in 2005 and 2006. Higher capital imports for the Skeldon Project, increasing fuel prices, and the volume of consumer and durable goods to restock depleted inventories combined with lower volumes of sugar exports, will lead to a significant deterioration of the current account balance. As a result, the current account deficit will rise from 12 percent of GDP in 2004 to about 26.7 percent of GDP in 2005 and 26.8 percent in 2006 before declining to 12.8 percent of GDP in 2009. Gross international reserves will remain at an average of 3.4 percent of import cover.

The Investment Programme

Clearly, transforming the economy, improving economic and social infrastructure and meeting the MDGs will require substantially more resources. Yet, unless Guyana undertakes critical investments in recovery and reconstruction, modernizes and restructures the sugar industry and begins laying the ground work to facilitate private sector investment and growth, poverty indicators will worsen sharply and attainment of the MDGs may become elusive.

Consistent with the output growth rates presented above, the public investment requirement for the period through 2009 was derived on the basis of a review of each sector’s past performance and future potential, in addition to the urgency of completing recovery and reconstruction of the productive capacity destroyed by the recent floods. These levels are represented in the public investment breakdown shown in Table 7.2 below. The medium-term investment programme represents a significant increase over the previous years. Figure 7.1 provides trends of the investment programme from 2000 to 2009. From G$25.2 billion in 2004, the programme rises precipitously to G$47.5 billion in 2006 before declining to G$34.4 billion in 2009.

Figure 7.1.:
Figure 7.1.:

Trends in Investment Expenditure

Citation: IMF Staff Country Reports 2006, 364; 10.5089/9781451816778.002.A001

Several factors are responsible for this steep rise. First, the restructuring of the sugar industry, included in the PSIP, is estimated to cost close to G$30 billion during 2005-2007. Second, rehabilitation and reconstruction of infrastructure arising out of the natural disaster is estimated to cost about G$14.6 billion over the same period. And, third, the cricket stadium under construction, will contribute another G$4.7 billion. With the completion of these major projects, the investment programme begins to decline in 2008, returning close to 2000 levels in 2009 (as a share of GDP).

Policies and Reforms to Promote Growth

Despite progress with the legal and regulatory framework, the private sector has not responded in a way that will boost the economy and create jobs to reduce the prevalence of poverty. Clearly, the stimulation of private investment will take more than appropriate laws and regulations. It will require a complementing infrastructure, political stability, law and order, and the reduction of red tape in the government bureaucracy. With these in mind, the Government will design and implement policies that will make Guyana a safe haven for private investment to flourish.

Accelerating the Restructuring and Modernisation of Traditional Sectors

The traditional sectors of agriculture, forestry and mining account for more than 34 percent of gross domestic product, employ more than 40 percent of the total labour force and contribute over 65 percent of foreign exchange earnings. These sectors also face daunting challenges in maintaining and improving competitiveness. Given the importance of these sectors to growth, job creation, and poverty reduction, Government is taking several steps to facilitate and accelerate their restructuring and modernization.


Rural Agriculture, Fishing and Livestock Sub-Sectors

The Government will continue to implement programmes in support of rural agriculture in order to reduce rural poverty. Some of the measures that will be taken in the medium term in addition to existing programmes include (i) developing regional markets for the export of beef; and (ii) expanding markets for the exports of non-traditional exports. Ongoing reforms at the Bureau of National Standards will support these initiatives by providing guidance and enforcement of international best practices. Even so, the intervention of entrepreneurs in packaging and marketing will be critical in the success of the government’s rural agriculture program. The Investment Law and the Small Business Act provide incentives in geographic location of industries. The Government through Go-Invest will market the sector opportunities with the view of attracting investors in the agriculture sector.

In the rice sub-sector, in particular, the Government in the medium term will continue to implement its 2001-2011 strategic plan with emphasis, in the near term, on (i) improving cleaning, drying and storage facilities in each of the rice growing areas by 2006; (ii) obtaining 50 percent whole grain of milled rice of acceptable quality by 2005; (iii) increase the production of parboiled rice as a percent of whole grain to 25 percent; (iv) increase the share packaged rice production to 10 percent of total production; (v) establish bulk loading facilities for by 2006; and (vi) issue freehold land titles for 60 percent of rice farmers by 2006.

As part of the Fisheries Management and Development Plan, an Exploratory Committee will be established to assess the possibility of harvesting offshore resources. The Fisheries Department will restart the Observer Programme to better understand the potential of the seabob resource. The department is also expecting three projects to come on stream with funding from Japan, in the areas of aquaculture, a database of Caribbean Fisheries and an offshore survey for Large Pelagics. Another focus for 2005 is the restarting of the Cooperative Societies so that they can honour their debts to the Fisheries Department, which amount to approximately US$25 million.

The Guyana Marketing Corporation (GMC) will continue its marketing efforts through export promotion activities in the Caribbean and North America. In collaboration with Golnvest, the trade and investment exposition--Guyana on Show--will take place in St. Lucia, Jamaica, New York and Miami. These activities, in combination with market studies, will identify key growth areas. In order to transfer this information to stakeholders, GMC will continue field visits to farming areas.

Specifically, in the dairy sector, a priority goal for the National Dairy Development Programme (NDDP) is the effective use of limited resources to increase beef production in targeted areas on the coast, with particular emphasis on producing beef with increased export possibilities. Support will be provided for the establishment of dairy processing units and the promotion of local dairy products. In order to accomplish the above, the NDDP will continue to unify farmers into strong, viable and sustainable groups to better withstand the impacts of globalisation.

Guyana will benefit from 11.7 million of the 24 million Euros within the European Union’s Rice Project to assist Cariforum countries in improving competitiveness in the rice sector. Work on this project has started and will continue in 2005. During 2005, GRDB will continue to work towards increasing production within the sector and monitoring the sale of paddy by farmers to millers.

The Sugar Sub-sector

One of the key challenges facing Guysuco is the reform of the European Sugar regime, which will come into effect in mid-2006. The proposals will see a reduction in price under the Sugar Protocol, amounting to 39 percent over a four -year period. The speed and depth of this cut will be extremely damaging to a vulnerable industry and is expected to result in an annual loss of income of US$90 million for CARICOM sugar producers as a whole. For Guyana, the EU proposal on reform of the sugar regime will result in an annual loss of US$40 million. This will be exacerbated by an enforced change to EU sugar subsidies after a challenge in the WTO. The change will put further downward pressure on international prices, again affecting the viability of the industry.

(i) Skeldon Factory
  • The Guysuco Skeldon Factory project covers the construction of (i) the raw sugar factory; and (ii) the steam and power cogeneration plant. Upon completion, the factory will be capable of producing up to 120,000 tonnes of high quality (VHP) raw sugar per year and supplying 10 MW of power to the national grid. Design work for the factory is ongoing. An advance team of ten engineers is currently in Guyana preparing for mobilisation and will be followed by the arrival of another workforce in August 2005. Civil works will begin in November 2005. Factory equipment will begin arriving in March 2006. Construction work will continue through to mid 2007, and the factory commissioned in October 2007.

(ii) Cogeneration
  • This significant element of the works will comprise the capability to export 10 MW of power throughout the year on a guaranteed basis. The bagasse residue from the sugar cane process will be the primary fuel supplemented by diesel-powered generation when bagasse stocks are exhausted during the inter-crop periods. The early completion of the diesel power plant will allow Guysuco to export power in advance of the main factory completion, thereby increasing its revenue stream and improving the stability of the power supply in Berbice.

(iii) Cane Production
  • The project has planted approximately 16 percent of the target cane area, with further planting being constrained by the processing capacity of the existing sugar factory. The production of additional sugar cane will be constrained by the availability of resources and will be synchronised with the commissioning of the new factory. In addition, Guysuco will adopt and begin implementation of an Environmental Management Plan for the Skeldon Project and associated canefield expansion including effective wildlife conservation at the Halcrow and Guysuco conservancies.


The Government, in 2005, will submit a revised Forestry Act that improves the legal basis for sustainable and environmentally sound management of Guyana’s forests. The regulations to this Act will be completed in 2006.


The Mining Amendment Act will be tabled in Parliament in 2006. An Environmental Impact Assessment for the mining sector will be conducted in 2005. Terms of References for the study have already been drafted.

Additional strategies, which have been developed and will be initiated include:

  • Developing multi-stakeholder participation and consensus on mining sector issues

  • Enhancing indigenous community participation and benefit sharing

  • Improving small and medium scale mining.

Priority areas for the Geology and Mines Commission for 2005 are as follows:

  • Improving environmental practice, efficiencies and productivity in the sector

  • Improving land management and access for both miners and indigenous communities with benefit-sharing for the latter

  • Demonstrating and encouraging improved mining and processing techniques

  • Piloting fully for replication re-vegetation projects

RUSAL is currently undertaking pre-feasibility studies, inclusive of confirmatory geological borehole drilling for reserves with a view of establishing an Alumina plant and will take ownership of the Aroaima Bauxite Company by end 2005. Gold Stone Resources has begun to expand prospects for the development of high plateau bauxite in the west of the country, and initial discussions are underway with Trinidad and Tobago’s National Gas Company on how an alumina plant project in Guyana may fit into the Trinidad Aluminum Smelter Project.


Guyana’s tourism sector offers exciting opportunities for economic growth and poverty reduction. Over the last 5 years, substantial progress has been made in developing the tourism sector. Nevertheless, progress is limited by poor infrastructure, degradation of the environment and stable political environment. In the context of the vast potential, the Government has developed a 5-year tourism strategic plan to rejuvenate the sector and create employment opportunities. The Strategic Plan takes into account (i) an assessment of the industry and the global tourism industry; (ii) recent developments in the eco-tourism industry; and (iii) recent study titled “Identification of Tourism Development Initiatives for Guyana”.

The development of the strategic plan will would require (i) a comprehensive assessment of initiatives towards policy and planning of initiatives towards policy planning for the sector; (ii) examination of the integration of the tourism sector within the wider national development context; (iii) assessment of positioning of tourism as a priority sector for national development; and (iv) engagement in consultation of wide cross-section of stakeholders. The Strategic Plan, among other areas, will concentrate on policy, planning, markets and marketing, legislation, standards, infrastructure and accommodation.

Improving Competitiveness

Guyana operates an open economy with exports accounting for more than 75 percent of GDP. With small population and limited internal market, growth prospects and poverty reduction are tied to Guyana’s proper management of its adjustment to the new world economic environment. To this end, the Government will implement policies in the medium-term that will improve the country’s competitiveness in the global markets place and that ties in all the facets of its productive sector. In particular, the Government will implement core policies that cut across most sectors of the economy and consists of incentive policies including macroeconomic policy, competition policy, taxation policy and trade policy and supply side policies including policy measures with respect to education and training, technology and standards, finance, investment promotion, red tape and aspects of the legal system; sector strategies to address the particular obstacles and opportunities facing enterprises on a sector specific basis; and (iii) strategic sub-sector or cluster policies that aim to target centers of dynamism which provide opportunities for growth and diversification.

Implementing Tax and Expenditure Reforms

The Guyana Revenue Authority (GRA) will continue to enhance the system for registering taxpayers, accounting for revenue collections and controlling refunds as part of the planned implementation of the new information technology-based tax administration system. Work will continue on the implementation of the Taxpayer Identification Number (TIN) system, along with efforts to computerize the License Revenue Office.

A comprehensive Audit Plan is being developed to improve audit coverage of the tax roll and increase the recovery of unpaid taxes. Initiatives to enhance the anti-corruption programme through increased investigations, enforcement measures, training, and sanctions will also be maintained. Systems to track information on tax exemptions will be enhanced, enabling more detailed information to be published when the information technology tax administration systems become operational. In addition, policies, procedures and systems will be put in place for the administration of the Customs Duties (Amendment) Order No. 6 of 2005.

The Value Added Tax (VAT) Bill was enacted in July 2005 and implementing regulations for the VAT and Excise Tax will be in place by October 2005. The VAT Legislation would replace the Consumption Tax Act, the Travel Voucher Tax Act, the Hotel Accommodation Tax Act and laws relating to service, premium, purchase, entertainment and telephone taxes. Once passed, it will lead to registration of businesses ahead of the full implementation of the system by July 2006. A number of consultation sessions are planned leading up to VAT implementation. A VAT Steering Committee and Implementation Team is in place at the GRA, along with a VAT Unit.

In addition, the Government will publish tax exemptions granted, specifying the amount and recipients by categories, by the end of June 2005. Further, a study has been undertaken on the economic costs and benefits of the existing exemptions focussing on how the exemptions affect the critical economic sectors.

On improving the soundness of the pension system, a prudential framework for investment decisions of the National Insurance Scheme will be implemented in September 2005 and a review of the public service pension system will be undertaken in December 2005.

Monetary and Financial Sector Reforms

The Government will also take measures to implement monetary and financial reforms in order to further improve the operations of the financial system. To this end, a Financial Sector Assessment Programme (FSAP) will be undertaken shortly to provide a comprehensive review of Guyana’s financial system and vulnerabilities. Consistent with the Amended Bank of Guyana Act 2004, the Governor of the central bank was appointed in June 2005.

In recent years, there have been discrepancies in fiscal and monetary data. Towards resolving this issue, an action plan for reconciliation of fiscal and monetary accounts was completed in May 2005. The Bank of Guyana will continue to conduct onsite inspections of at least 4 banks. The New Building Society inspection is scheduled in 2006. In addition, the banking supervision department of the Bank of Guyana will intensify training on risk-based supervision, develop a risk-based manual, and computerize the financial charts of accounts. Further, the Government will support the reduction of financial intermediation costs by establishing a commercial court in 2005 and issuing title deeds without restriction on transfers. The Government will also review and update all AML/CFT legislation to ensure that they are in line with international best practices.

Export Promotion

Although the Guyana Office of Investment (Golnvest) was created to promote a more conducive investment climate, attract foreign direct investment (FDI), and promote export of traditional and non-traditional commodities, Golnvest has not yet been transformed into a truly one-stop shop. Government, in the medium-term, will restructure and refocus Golnvest in terms of its capacity to assist investors to set up businesses by filing all necessary documents and receiving all permits. This will include the establishment of branch offices/business centers in the key economic centers in the country. The main and branch offices will be staffed by well-trained advisors and equipped with state of the art communications and IT equipment. Golnvest will also have the responsibility of facilitating FDI flows and encouraging exports to regional and international markets. Measurable results will include reducing the number of days to set up a business and increases in the levels of FDI and exports. Funds are required for training, hiring expert advisors, and for equipping the various business centers.

Investment Promotion

Towards creating a favourable investment climate and promoting foreign and domestic investment, the Government will continue its fight against violent crime, improve its economic infrastructure, improve governance and continue positive dialogue with the political opposition. Many of these issues have already been dealt with in several sections of the document. In addition to implementing reforms in many of these areas, the Government will establish a Small Business Council to review regulations in the business sector and make recommendations to simplify procedures. Also, the Investment Promotion Council will be established to carry out the functions set out in the Investment Law. Further, the Government will review the Companies Act 1991, the Partnership Act, the Business Names (Registration) Act and the Friendly Societies Act of Guyana.

In addition, IPED will continue to promote investment in aquaculture, and to encourage the production and exportation of soya beans. Its Hinterland Thrust will be consolidated in 2005, and a methodology for promoting a business orientation in young people will be developed through collaboration with more than 50 youth groups. IPED also plans to focus more concertedly on working with the unemployed, and is currently negotiating with Laparkan and Western Union on the possibility of remittances being used for investment in business development. In addition, IPED will foster closer links with agencies such as the UG Faculty of Technology, IAST and the EPA to facilitate the transfer of technology to the business sector.

It is envisaged that over the next three years, the EMPRETEC programme will continue to implement its Small Business Development Programme, about which initial discussions have already been held with the Ministry of Tourism, Industry & Commerce. By the end of 2008, it is expected that a total of 400 entrepreneurs with high growth potential operating primarily in the key development sectors of general manufacturing, tourism, textiles and clothing, wood and agro processing, will be exposed to the tools necessary for improved competitiveness both locally and internationally. To facilitate the establishment of small business, IPED, EMPTRETEC and Go-Invest will provide training and assistance to set-up or support newly established business and also assist in identifying potential new export markets. To this end, the Bureau of Standards will continue to provide information, support and awareness and enforce internationally agreed standards of product quality.

Governance and Institutional Regulatory Reforms

(i) Improving Transparency and Accountability

  • The Government will take steps to strengthen institutions and agencies that provide oversight to public finances. To this end, the Audit Act, which was enacted in 2004, will become operational in 2005. Further, steps will be taken to implement several recommendations in the Auditor General’s Report. Specifically, the Wildlife Division will be merged with the Environmental Protection Agency (EPA) and its revenues transferred to the consolidated fund in 2005. Accounts of the Wildlife Division in the medium-term will be audited as part of the accounts of the EPA. Also, all existing external loans will be tabled in Parliament and the audited accounts of the GRA will be placed in Parliament.

  • In addition, fiduciary oversight will be strengthened through (i) enhanced parliamentary oversight; (ii) reduction in discretionary powers; and (iii) disclosure of officials’ assets. Specifically, the Government will adopt and begin implementation of a time-bound reform programme to implement recommendations of the fiduciary oversight studies. Further, the Ministry of Finance will complete reconciliation of the payroll and IFMAS databases for all public servants identify major disparities between IFMAS and payroll, and complete reconciliation of the disparities in 2006.

(ii) Procurement Reforms

  • With the passage of the Procurement Act and its regulations, the Government has begun undertaking administrative reforms to enhance the operational efficiency of the agencies and institutions involved in implementing the Procurement Act. In line with this, the government has appointed the members of the National Procurement Board (NPAB) and within the next 18 months will complete the following reforms:

    • Dissemination of new laws and regulations through workshops and seminars;

    • Preparation of new administrative tools to discharge the NPAB’s new responsibilities including internal administrative rules, standing bidding documents, prequalification, evaluation, and contract forms, procurement manuals, guidelines and procedures, and flow charts and time schedules for all procurement methods;

    • Design and implementation of a management information system for the NPAB’s operation; and

    • Preparation of training and dissemination program on new administrative tools

    • Design and preparation of technical specifications for an electronic computer software/hardware package.

(iii) Land Tenure Security and Land Administration

  • The Government in the medium term will continue to improve land tenure security and land administration with a view to (i) reducing the time for Land Registry transfers by private landowners from 4 to 2 weeks; (ii) making land and property information available in a central location; and (iii) establishing a one-stop-shop for property transactions at the GLSC. In 2005, GLSC will complete the computerization of its land registry records.

(iv) Local Government

  • Efforts will continue to promote capacity building and institutional strengthening within the Local Government system, and a strategic plan will be in place by the end of 2005. These reforms, which would include training and recruitment of staff, will assist local government entities in efficiently managing the affairs of local communities. Further reforms in the medium-term will include amendment of Local Government Laws, which will be designed to empower local government bodies and also hold these bodies more accountable. In addition to ongoing programmes currently on stream, the Ministry will be working on:

    • continued support for the Local Government Reform Process prior to new Local Government Elections, allowing communities to choose their own leaders;

    • the dissemination of national policies for implementation by the Regional and Local Government Administration;

    • the identification and preparation of landfill sites in Regions 3 and 4;

    • the completion of the Urban Development Programme; and

    • the establishment of four new townships.

(v) Reducing Crime and Improving the Justice Administration

  • The Government will continue to attach high priority to reducing crime and improving the general security of Guyanese. To this end, specific measures will be taken to improve the institutional capacity of the security agencies to maintain law and order. Measures will include:

    • Enhancement of the capacity of the Guyana Police Force to prevent, detect and interdict criminal activities;

    • Restructuring of the Guyana Prison Service and implementation of structured programmes for security and rehabilitation of prisoners;

    • Mainstreaming the use of Information Technology within the Ministry of Home Affairs for greater administrative and operational efficiency;

    • Establishment of an administrative framework and structure, and the coordination of the activities of the various departments involved in the implementation of the Guyana/Brazil International Road Transport Agreement;

    • Development of a National Immigration Policy and a strategic plan for the Secretariat;

    • Implementation of the National Drug Strategy Master Plan, 2005-2009;

    • Reviewing the penal code with a view of making it harsher in dealing with repeated and violent crimes.

  • Enhancing the capacity of the Guyana Police force to detect and prevent crime and to prosecute criminal offenders is central to crime prevention efforts. In pursuit of these goals the following activities will be undertaken:

  • Reorientation and decentralization of community policing in Guyana to allow members of community policing groups to become the catalyst for positive change in their communities, by projecting civic responsibility and alternatives to criminal lifestyles. The Units will not be centralized but there will be strong linkages between communities and the Police Division to facilitate the transfer of intelligence, ensure the security of communities and promote positive police-community relations.

  • Enhancement of Border and Immigration Security to better monitor entries and stem trafficking in weapons, illicit drugs and in persons. Elimination of piracy in seaports, along the rivers and the Atlantic Coast will also be vigorously pursued and for that purpose the Marine Police station at Ruimveldt has been rebuilt, and a vibrant River and Shore Patrol Unit will be established. These improvements are critical given the imminent development of airstrips at Bartica and other locations, but resources such as vehicles, boats, communication equipment, computers, etc. are required for them to materialize.

  • Reorientation of Ranks and Responsibilities for Law and Order will require that ranks respond to any crime observed or reported, regardless of the nature of that crime or the proximity of the crime scene to the station to which the rank is attached. Members of the force will intervene in any incident of public disorder including domestic violence and indecent language, and the beat system of police foot patrol will be reintroduced.

  • Improvement of Public Relations and the Image of the Force will be pursued through training to develop civility and professionalism, and to dispel the aggressive and acrimonious image that may be projected by some ranks and perceived by some members of the public.

  • Development of a Modern and Effective Force that is a technically and technologically sound organization throughout the next decade, and is capable of providing a service to the nation that is compatible with its regional and hemispheric counterparts. To this end, a process had begun to familiarize members of the Force with information systems and communications technology. This includes using the internet for research and for rapid and secure transfer and exchange of information between patrols on the road, investigators in the field and officials at the central database. There will also be a more coherent effort at networking between the Force and other collaborating local government agencies. A diagnostic study for the Information System has been completed but its implementation will require foreign assistance. Critical to the modernization of the Force is the development of language skills relevant for interacting with citizens from all countries in South America. Competency in a second language will become an essential condition for advancement in the Force.

  • The Government will continue to improve the administration of the justice system in support of an enabling business environment and adherence to fundamental human rights and the rule of law. To this end, consultancy work is ongoing with a view of passing commercial legislation and establishing a commercial court. This will help to instil confidence in investors with regard to the legal system. The judiciary also continues to make progress in the reduction of backlog of cases. It is anticipated that by 2007, the current backlog of over 7,000 cases will decline to about 2,500.

  • In addition, the judiciary plans to establish a family court in 2007. Among other things, this court will help to bring quicker resolution to family matters, especially those involving children. Further, training will be provided to personnel involved in Alternate Dispute Resolution with a view of reducing the number of cases that make their way to the courts. The north-south wing of the High Court will be rehabilitated and the Court of Appeal extended and renovated, in order to meet the requirements of the Caribbean Court of Justice.

(vi) Improving Political Governance

  • The Government, in consultation with the Parliament and the major political parties, will carry out comprehensive reforms with a view to improving political governance in the medium-term. These reforms that will involve the Parliament, the Parliamentary Committees and the Executive Branch, will be essential for strengthening and deepening the democratic process and providing an umbrella framework for political parties and in particular, the National Assembly, to contribute more meaningfully to the development process. The comprehensive study undertaken in Fiduciary Oversight and the Davies Report will form the basis of this. The 2001 Constitutional Amendment, the recommendations of the Fiduciary Oversight Study and recommendations of the Davies Report will form the basis of these medium term reforms. To this end, a time bound action plan will be proposed to address many of the recommendations that will further expand the role and the autonomy of the National Assembly to meaningfully contribute to Guyana’s development.

Chapter 8 Infrastructure Development to Support Growth and Social Services: The Medium Term

The events of the recent natural disaster exposed Guyana’s fragile infrastructure and heightened associated risks to long-term sustainable growth. Its lessons are reflected in the medium term investment programme with increased emphasis on drainage systems, conservancy dams, the road network and development of other infrastructure critical for complementing economic growth and social development. Not surprisingly, public investments in the medium term provide a sharp contrast to ones in the past.

Table 8.1


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Source: State Planning Secretariat, Ministry of Finance and PCPMU. Office of the President

Includes routine spending plus expenditure for Skeldon project

Includes BNTF, SIMAP, Rural Support Project and Locally funded Poverty Programmes

Total less Transfers

Italicized items are to highlight key components and are not an exhaustive set of the sub-components