Guyana’s overall real GDP grew by 59.5% in the first half of the year, with non-oil growth of 12.3%

according to the Mid-Year Report 2023

Georgetown, Ministry of Finance: Guyana continues to achieve strong, resilient, broad-based economic growth. In the first half of the year, the Mid-Year Report of 2023 highlights that our growth in overall real Gross Domestic Product (GDP) is estimated at 59.5 percent in the first half of the year, with the non-oil economy growing by 12.3 percent. This reflects the focus of Government’s policies on modernising the traditional pillars of the economy and catalysing a growing and competitive non-oil economy. The revised full year real GDP growth in 2023 is now projected at 28.2 percent and 9.3 percent for the non-oil GDP.

Senior Finance Minister Dr. Ashni Singh, while reflecting on this year’s Budget presentation under the theme ‘Improving Lives Today, Building Prosperity for Tomorrow’, explained that it reflects Government’s commitment to address the most immediate issues and irritants facing the Guyanese people while at the same time laying the foundation for a bright and secure future for all citizens for the longer term under President Ali’s One-Guyana philosophy.

“Despite the challenging external and domestic environment, the Guyanese economy continued to achieve strong positive real growth, coming from both the oil and non-oil sectors. Particularly in the non-oil economy, strong performances have been returned by agriculture, other mining and quarrying, as well as services,” the finance minister indicated.

The key macroeconomic highlights are as follows:

SECTORAL PERFORMANCE

Agriculture, Forestry and Fishing 

The agriculture, forestry and fishing industries expanded by an estimated 7.6 percent in the first six months of the year, with growth observed for all subsectors – other crops, rice, livestock, fishing, forestry and sugar.

  • The sugar industry grew by 30 .1 percent when compared with the first half of 2022 with the full-year projection maintained at 29.3 percent.
  • The rice industry grew by an estimated 3.2 percent in the first half of 2023 with a revised growth rate of 7.4 percent for the entire year.
  • The other crops subsector is estimated to have grown by 9.4 percent in the first half, with a revised growth rate projection of 4.9 percent for 2023.
  • The livestock industry expanded by an estimated 4.7 percent in the first half of the year and is now expected to grow by 10.4 percent for the entire year.
  • The forestry industry is estimated to have grown by 4.5 percent and is expected to grow by 4 percent for the year.   
  • The fishing industry is estimated to have expanded by 9.9 percent in the first half is expected to grow by 8.4 percent in 2023.  

Extractive Industries     

The mining and quarrying industries are estimated to have grown by 89.9 percent in the first half of the year, driven by growth in the petroleum and other mining industries.

  • The petroleum subsector grew by 98.4 percent, with 68.7million barrels of oil produced in the first six months of this year. The industry is now projected to grow by 39.6 percent for the entire year.
  • The other mining and quarrying industry which comprises sand, stone, diamonds, and manganese-is estimated to have grown by 45.2 percent in the first half, driven by greater activity in the construction sector. This industry is now projected to grow by a 17.1 percent in 2023.

Manufacturing, Services and Construction

The manufacturing sector is estimated to have grown by 17.7 percent in the first half, largely driven by increases in the manufacturing of wood products, fabricated metal products, non-metallic products, paints, and plastic products. The sector is now projected to grow by 7.8 percent this year.  

The services industries are estimated to have expanded by 9.1 percent, driven largely by growth in administrative and support services and wholesale and retail trade and repairs. The overall 2023 growth rate for services is now 7.8 percent.    

The construction sector is estimated to have grown very substantially by 44.1 percent in the first half, reflecting large growth in the Public Sector Investment Programme (PSIP) and intensified private construction. The sector is now expected to grow by 26.9 percent in 2023.   

BALANCE OF PAYMENTS

The overall balance of payments recorded a deficit of US$196.4 million at the end of the first half of 2023, with a smaller surplus on the current account and some improvement was observed on the capital account.

With respect to trade, export receipts continued their upward trend growing by 38.8 percent to US$6,039.3 million at the end of June 2023, largely on account of higher oil export earnings, which amounted to US$5,374.1 million in the first half of the year.   

Total import payments also grew substantially over the review period reaching US$3,717.3 million, growing 111.8 percent over 2023. This is largely attributed to the importation of the Prosperity Floating, Production, Storage, and Offloading (FPSO) vessel, which arrived in April, and imports of fuel and lubricants.

MONETARY DEVELOPMENTS

Domestic Credit

Net domestic credit expanded in the first half of the year, reflecting households’ and businesses’ demand for credit and banks’ willingness to lend – an indication of growth in private and public sector borrowing.

Total credit to the private sector grew by 5 percent when compared to December 2022, to $345.3 billion at the end of June 2023, on account of increased lending to businesses and households.

Credit to business enterprises in the services and manufacturing sectors grew by 3.3 percent and 8.9 percent to $121.8 billion and $40 billion, respectively.

Lending for the purposes of real estate mortgages grew by 7.3 percent to $112.7 billion driven by mortgages granted for private dwellings, and industrial and commercial properties.

Inflation

On account of Government’s commitment to easing the burden of growing commodity prices, a suite of measures was put in place over the last two years. This has contributed significantly to the slowing inflation rate observed locally.

When compared with the end-2022 position, the consumer price index declined by 0.3 percent, reflecting some reversion in the spikes observed last year. When compared with June 2022, the index grew by 1.9 percent, on account of declining food prices.

Inflation is projected to be in the order of 3.8 percent for 2023.

The Government will continue to be proactive to prevent persistent hikes like those observed last year, as some level of uncertainty still clouds the outlook for 2023,

Dr. Singh has concluded that in its just over 36 months of the current term in office, Government’s implementation of Budget 2023 during the first half-year of 2023 saw significant gains being recorded on all fronts. The economy continued to record strong positive economic growth, work commenced and advanced on major transformative infrastructural projects, more community roads are being rehabilitated than ever before, and jobs are being created in every sector of economic activity.

The Government is committed to ensuring the delivery of all the promises made in the Manifesto and in so doing improve the life of every single Guyanese citizen and harness the advantages of our rich and beautiful diversity as One Guyana.  

To view the entire Mid-Year Report 2023, click here:  

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