Guyana - Economy

Overview:The economy is based on agriculture and mining. After near collapse in 1982, it was resuscitated by strict implementation of IMF-backed economic reforms. By the mid-1990s, these reforms had had success in stabilising the currency, controlling inflation and increasing output and trade, and the economy was growing at an annual rate of more than 6% in 1996 and 1997. Inflation peaked at 83% in 1991, following substantial devaluations of the Guyana dollar, but was in single figures from the mid-1990s, though it remained relatively high. Privatisation had led to new investment and creation of new jobs.

The reforms included extensive privatisation of state-owned operations, some of which – for example, the Sugar Corporation and Guyana Airways Corporation – are now under private management and/or ownership.

But the combination of drought, falling commodity prices and political uncertainty in 1998, caused growth to stall. The economy then grew very little during 1998–2005, while inflation was generally over 5%. After eight years of economic stagnation the economy underwent remarkable recovery in 2006 and 2007, growing by over 5% p.a., though inflation rose above 10% in 2007.

Trade: The main exports are gold, sugar, prawns, rice, bauxite, and timber. The main imports are manufactured goods, consumer goods and fuels. Chief export partners are the USA, Canada, the UK and Netherlands Antilles. Chief import partners are the USA, Netherlands Antilles, Trinidad and Tobago (mainly oil) and the UK.

From 2007, when the Cotonou Agreement between the European Union and the ACP grouping of developing countries came to an end, negotiations proceeded on a series of regional Economic Partnership Agreements, to replace the preferential trade agreements of the Cotonou Agreement with WTO-compliant free-trade areas.