The Hon. Minister of Finance Winston Jordan today began consultations for Budget 2016.
He and a high level team from the Ministry of Finance, led by Finance Secretary Dr. Hector Butts, met with Chairman of the Private Sector Commission (PSC) Major General (Rtd) Norman Mc. Lean and other representatives of the PSC earlier this morning.
Among the issues raised was the Private Sector’s concern about the present state of the economy.
In response, Minister Jordan reported that information coming out of the Bureau of Statistics shows that the outlook of the economy remains positive for the rest of the year while acknowledging that the first half of the year was affected by a downturn that began in 2014.
He further noted that at a recent IMF/World Bank Annual Meeting he attended, it was revealed that world economic growth had slowed, and so the challenge of a slowdown in growth was not peculiar to Guyana.
The Hon. Minister said that the latest Bank of Guyana statistics indicate that Private Sector Credit and Production have seen positive growth for the period January to October and projected that this growth will continue into the final quarter of 2015. Likewise, other positive economic indicators showed Real Estate Mortgage loans rising by 12 percent, and Construction and Engineering by 9 percent.
On the production side, Rice grew by 15 percent between January to July; and Sugar by 4 percent for the period January to October, while positive growth was recorded for diamonds, eggs, poultry meat and electricity, among other sectors.
These, he said, should boost investors’ confidence in the economy as well as catalyze the Private Sector to renew their resolve to increase their investments in production as well as value added services.
The PSC welcomed the news that Private Sector Credit had increased by 6 percent between January and September.
Minister Jordan told the PSC that the government was pursuing new markets for rice to which there have been very encouraging responses and also reminded them that for the first time in the recent past sugar production had exceeded the target.
The PSC for its part discussed challenges with the VAT Refunds system employed by the GRA, to which the Minister pointed to the functioning Tax Reform Commission as well as the impending audit of the entity that will ensure that the challenges raised will be addressed satisfactorily.
The Minister also said that his Ministry was collaborating closely with the Hon. Minister of Business, Dominic Gaskin, to improve the ease of doing business in Guyana, which in turn would effect an improvement in Guyana’s ranking in the Doing Business indicators.
The PSC welcomed the improvements being made at Go-Invest to make it a truly ‘one stop agency’ but cautioned that the bureaucratic malaise of the past should not be continued.
The body also noted that the recent expansion of airlift capacity for cargo out of Guyana should be seen as an opportunity to boost diversification of the Agriculture sector into fresh fruits and vegetables which are in high demand in the North American and Caribbean markets. They urged Government to invest in laboratories and other devices that would ensure certification and accreditation.
The PSC also discussed other issues for consideration in the 2016 budget, including corporate, personal and property taxes – written submissions on these had been sent to the Tax Reform Commission; interior roads and airstrips; export marketing support; liberalization of the telecommunications sector and the National Competitiveness Strategy.
In response to the issue of airstrips, Minister Jordan informed the PSC that funding has already been approved for the upgrade of two airstrips and discussions are ongoing with international funding agencies for the upgrade of several others.
He added that there was common ground between his Ministry and the issues raised by the PSC.
Minister Jordan and the PSC agreed to meet quarterly in the interest of closer collaboration.