Budget 2004: Enhancing social development
Editorial
Guyana Chronicle
March 30, 2004
FINANCE Minister Saisnarine Kowlessar's fourth budget presentation in the National Assembly yesterday will no doubt generate mixed reaction from an anticipating public.
While many will be rejoicing at the minister's delivery of the largest no-tax budget in Guyana's history, some will be fuming at their disappointment that the budget did not give them the ammunition they projected - a tax increase to trigger a sharp rise in consumer prices on the one hand and political mileage on the other.
Budget Day is a very significant part of a nation's history, in that it reviews past economic performance and enunciates new policies and initiatives for the current year, in an effort to sustain growth and economic development.
A major characteristic of each budget presented by the PPP/C administration since it assumed office in 1992 has been the human face of its economic and social policies. This year's budget echoes that very thrust: to enhance economic growth with social equity.
The budget reports that the unfavourable domestic and external environment resulted in a negative growth of 0.6 percent last year. Even so, prudent fiscal and monetary policies by the Government assured that the main macroeconomic fundamentals were intact.
The rate of price inflation was 4.9 percent, the exchange rate was more or less stable, the Central Government deficit kept well within target, and external debt was reduced to US$1.08 billion after the achievement of the Highly Indebted Poor Country (HIPC) Initiative completion point. The budget also indicated that over 95% of the Public Sector Investment Programme of $16.8 billion in 2003 was successfully implemented.
These were major economic achievements and are comparable to achievement in the region given the difficulties the economy experienced most of last year.
The budget expects the economy to return to strong, positive growth - 2.5% this year - by diversifying our economic base, while allowing the service sector to increase its contribution in overall economic activity. New areas of activity include information technology, eco-tourism and sport tourism.
The budget also identifies policy initiatives that will strengthen the traditional sector - sugar, rice and bauxite. These policy initiatives will provide the strong foundation for sustainable economic growth and longer-term development.
The budget's investment thrust envisages overall improvement in the quality of life of Guyanese as investment increases in the social sector. Education has received a big boost, an allocation of $14.5 Billion or 9.4% of GDP. Health and nutrition investment has been increased to $6.7 Billion, and the country's housing programme is to be intensified with an allocation of $1.4 Billion.
The social safety net and poverty intervention programmes have been implemented and will continue with rigor under accelerated SIMAP, Basic Needs Trust Fund and social assistance initiatives.
All in all, the strategies and investments projected for 2004 depict the theme of the budget, "Investment for Sustained Economic Growth and Enhanced Social Development."
After all, for poverty to be reduced on a sustained basis in Guyana, there has to be growth with social equity and greater investment in human capital. Even though the country faced constraints on a daily basis, investment in people has borne fruit, as indicated on the Human Development Index of the UNDP's 2003 Human Development Report.
The 2004 budget must continue in that direction. For development is about people.