Stable currency market, increased gov’t spending expected to reverse decline in imports – Boyer

Chairman of the Private Sector Commission (PSC) Eddie Boyer is optimistic that the stabilising of the foreign exchange market will also lead to an increase in imports.

Boyer told Stabroek News that the Guyana Shipping Association had recorded a 12% decrease in container traffic for the first quarter of 2017, compared with the same period in 2016. He credited the low availability of foreign exchange during this period as being partially responsible for the decline.

Also responsible, he noted, was a lack of government spending, which saw some contractors unable to import at previous levels.

“Disbursement of money from government was very slow and so we saw a decline in imports in the first quarter but with the levelling of the foreign exchange and increased government spending, this buying pattern should level itself,” Boyer explained.

On Thursday, Minister of Finance Winston Jordan announced that just 20% of the 2017 Public Sector Investment Programme (PSIP) had been implemented despite the early passage of the national budget.

“We have the monies… the issue is to get it out into the system. Yes, the PSIP, despite earlier budgets, we have not been able to make a dent into it… and yes it affects economic growth because in the economy that wants a stimulus, it is government’s spending people look to,” Jordan told reporters.

He explained that this is because of a “system problem that needs to be overcome.”

According to the minister, though the budget was presented in November and passed in December, advertisements pertaining to contract works are only now flooding the newspapers. “Some people are still accustomed to the budget coming out in March, so the entire work that needs to be done… By October, at least, all ministries know what their budgets are for the next year. Almost all, so you would think that the period between October and December, they would use for, let’s say pre-tendering …. And stop short of awarding of contracts until the budget has been passed. Pre-work. But it is rare to see some imagination taking place,” he said.