Country’s Financial System healthy and sound – BoG Governor
GINA, Georgetown, Guyana, June 1, 2016
The country’s financial system is quite healthy, sufficiently capitalized and sound in terms of liquidity. This is according to the Governor of the Central Bank of Guyana, Dr. Gobind Ganga. “We have seen an economy with very sound macroeconomic indicators, and confidence in the system to move forward,” Ganga said.
The governor was at the time responding to questions on the state of the economy, at a press conference hosted by the Ministry of Finance. He explained that Guyana has seen an improvement in its “financial health” with increased output in the mining sector and some improvement in the manufacturing and service sectors. According to Dr. Ganga, inflation has been constrained and deflation for the first quarter is estimated to be 0.5.
Externally, there has been a net purchase of Foreign Exchange of approximately US$25m. This has resulted in a relatively unchanged Exchange Rate. The exchange rate is currently about $206.5 (Guy) to US$1, according to the Governor.
Addressing the state of the country’s current account, Dr. Ganga said, there has been a change from a deficit of US$73.4m to a surplus of $51.5m. He also revealed that there is a surplus on the Current Account while the Capital Account has seen positive movement from a deficit of US$51.7m to a surplus of $14.8m.
The country’s ability to pay for its imports is much improved with import cover now at 4.7% compared to 4% of total imported goods and services. The Foreign Exchange Reserves currently stands at approximately US$619m compared to US$598 m for a similar period in 2015.
Dr. Ganga also stated that there has been a marginal decline in the country’s External Debt and a marginal increase in Domestic Debt. It was explained that Domestic Debt is largely for the absorption and sterilization of liquidity in the financial system and is therefore technically not considered a debt.
While there has been what the governor described as flat movement on the financial sector, there continues to be confidence in the economy with an almost 5% increase in credit to the private sector mainly in the productive sectors inclusive of agriculture, mining, manufacturing, household and construction according to figures released.