Guyanese protected against worst effects of inflation, cost of living crisis

-Owing to well-thought-out policies implemented by govt – Jagdeo

The “cost of living” crisis is affecting economies globally, and the government’s ‘direct’ economic policies shield Guyanese from the worst effects, Dr Bharrat Jagdeo, the General Secretary of the People’s Progressive Party (PPP) has again highlighted.

He pointed out that major countries, like the United States (US), are experiencing a major surge in prices of household essentials, including food and utilities, mortgages and fuel.

This phenomenon is no different in Guyana, and direct interventions have been implemented to lessen the effects. Speaking at a press conference on Thursday, Dr Jagdeo said these measures, in the form of decreased taxes and subsidies, must not be lost in the daily crisis reporting, but must also take centre stage.

He noted that although Guyana’s economy is much smaller than that of the US, it is experiencing massive growth that often leads to economic overheating and increased inflationary rates.

“Despite all of that, we have had some government policy interventions…last week I spoke of us removing the 50 per cent excise tax, equivalent to $81 billion, on only two items: diesel and gas,” he informed reporters.

Contrary to what is occurring in developed countries, the rates for electricity and water consumption have not increased since 2020, owing to the absorption of fuel costs by the government for the Guyana Power and Light (GPL) and the Guyana Water Incorporated (GWI).

Later this year, supplementary financing of nearly US$70 million will be sought to prevent an increase in electricity prices by subsidising fuel costs.

He added, “[This is] leaving out the tens of billions that we’re spending on new power generation capacity and upgrading the transmissions system, that would be next year.”

Notably, mortgage rates have decreased, which has enabled access to affordable financing for new low-income families. In 2023, the low-income mortgage ceiling increased to $20 million from $15 million, despite the global increase in interest rates.

Additionally, $10 billion is being injected yearly into the part-time job programme, benefiting women and single parents, with recent expansions in the hinterland areas.

Farmers, an important pillar of the economy are among key groups of people getting support from the government to offset the purchase of fertilisers. In 2023, some $850 million was set aside for this programme.

Around 60,000 persons are now enjoying gainful employment, in the private and public sectors and benefitting from millions in disposable income.

Dr Jagdeo underscored that the PPP/C administration has a clear plan to address the cost-of-living crisis and stated that no country is immune to this global phenomenon.

“You should appreciate what the government has done. In four years, especially with two years lost to COVID…and with all the inflationary pressures affecting a big country like the US…we in Guyana, because of direct government policy interventions, have kept some of the most substantial areas in the cost-of-living increases, we have kept them away from our people,” he said.

The government’s annual fiscal plan is crafted to navigate global economic challenges, with a focus on improving the livelihoods of Guyanese and building resilience across different sectors.