According to the Bank's 37th annual report, the growth largely reflected the performances of the agriculture, forestry and mining sectors, while growth in private sector consumption contributed to higher demand, which had a salutary effect on GDP.

According to the Bank, prudent fiscal and monetary policies, as well as lower food prices contained inflation at 2.6 per cent for all urban areas and 1.6 per cent in Georgetown during the review period.

On the external front, the overall balance of payments weakened through a deterioration of both the current and capital accounts.

The current account weakened mainly as a result of adverse terms of trade and lower volumes traded, while the capital account was characterised by outflows of short-term capital and a fall in foreign direct investment, the Bank stated.

Debt relief under the Original and Enhanced Interim HIPC (Heavily Indebted Poor Country) initiatives financed the overall deficit and contributed to the net foreign assets of the Bank.

The turnover of the cambio market was higher by 5.3 per cent as total foreign exchange transactions increased during the review period.

During last year, the Guyana dollar depreciated by 2.6 per cent largely because of seasonal demand pressures during the third and fourth quarters of the year.

The relative stability of the exchange rate during the first and second quarters was attributed to slow growth in imports and the monetary authority's efforts at dampening speculation in the foreign exchange market, the Bank said.

The financial performance of the public sector, on a cash basis, deteriorated in 2001 despite an improved outturn by the non-financial public enterprises, which was offset due to higher current receipts and restraint in spending, it said.

The Central Government's performance was due to higher non-interest current expenditures and a decline in capital revenues.

The stock of outstanding public and publicly guaranteed external debt continued to decline on account of debt relief under the Original and Enhanced Interim HIPC initiatives.

In contrast, the stock of the Government's boded debt increased due to the issue of treasury bills to sterilise excess liquidity in the banking system for the maintenance of price and exchange rate stability.

External debt service was lower due to the new payment schedule on multilateral and bilateral debt under the HIPC initiatives.

Domestic debt service payments also decreased as a result of lower interest rates.

External debt as a per cent of GDP fell to 166.1 per cent from 169.6 per cent lat year, while domestic debt as a per cent of GDP increased to 39 per cent from 37 per cent.

This year, real GDP is estimated to grow by two per cent while inflation is targeted at five per cent.

According to the Bank, its priority will be to continue with stabilisation of the macroeconomic fundamentals.