This is my first column in the series on Guyana in the wider world for the New Year. Readers I am sure would have anticipated that I would begin by looking forward to see what lies ahead and looking backwards to reflect on where we have come from and what we might have achieved or failed to achieve over the past year. The truth of the matter is that the sentiment surrounding a new year encourages reflective pieces, in which one seeks to combine analysis with speculation.
The wider world
Looking at the wider world first, it is hard to imagine that anything could happen that would replace the global pre- occupation with the 'war on terror' as the dominant geo- strategic and political reality for the international community. The engagement by the combatants shows no early end. A decisive emphatic military victory by either side can never be accomplished in this war. As history has shown time and time again, as the casualties and the cost of war mounts, the search for a political solution becomes paramount. At this moment, the world is very far from reaching a situation where the combatants can conceive of negotiating an end to this conflict.
The direct consequence of the 'war in terror' is that the war against poverty, hunger, disease and illiteracy will continue to falter. The signs of this are many. Thus, the pledge by the rich countries to donate 0.6 per cent of their GNP to help the poor countries will have few countries likely to even approach this target in the near future. More aid will be pledged with great fanfare and publicity but this will not be actually forthcoming. The strategy of the rich countries will continue to be either procrastination/delay in the disbursement of promised aid, or granting assistance for one purpose and negating this by reducing assistance for some other(s).
We also have the situation of the last WTO Ministerial Conference held in Hong Kong (December 13-18, 2005) where little progress was made in the present Doha Round of negotiations. This, in spite of the fact that the round is one in which it was declared that development concerns would take centre-stage for all WTO trade arrangements. At the Hong Kong ministerial held in December last year all the hard decisions on this issue were postponed to this year. Crudely put, however, very few persons are confident that the WTO will meet the challenge in 2006, as more of the same is more or less what everyone expects.
Turning to the global economy we can expect that the performance of global growth, inflation, trade, investment and financial stability will yield no major surprises. During this year it is likely that there will be moderate but positive outcomes on the economic front. Challenges, however, are bound to arise in areas critical to Guyana and the wider Caribbean. For example, commodity prices (sugar, bauxite-alumina, and bananas) will be under stress; 'sun-sea-and sand' tourism will face adverse pressures; direct investment flows to the region will not grow appreciably for several countries; and exchange rate stability and overseas development assistance will continue to be issues of major concern for some.
There will also be opportunities arising out of these challenges this year. An obvious one is a further bonanza for Trinidad and Tobago in rising energy prices. Another is the expansion of opportunities for niche marketing of the region's art, speciality foods, beverages and alcohol, entertainment and culture events, sports, and its environmental diversity for special types of tourism such as aquatic, heritage, agricultural and ecological.
Guyana's woes: looking backwards
The difficult issue that arises is whether or not Guyana is ready for the challenges of the years ahead or is in a position to seize any opportunities which might occur.
When one looks backwards it is clear that the multiplicity and complexity of the difficulties the country faces are immense. Included in this is the international environment, which I have just scanned and which as I have indicated is not propitious. The difficulties of the country are many-sided: social, cultural, political, economic, institutional, behavioural, and geo-strategic. If, however, one had to cite the single most aggravating condition that feeds and encourages the reproduction and growth of these difficulties it is I believe the failure of the economy to grow and generate increasing incomes and wealth. By itself growth will not, I emphasise not, solve the problems of Guyana. The pressures emanating from lack of growth, however, immiserise the whole society. It is for this reason that I have so often returned to make the point since the death of President Jagan this country has averaged real growth of GDP of about 0.5 per cent between 1998 and 2005.
This is a situation of depression, which has now lasted for nearly 7 years. Neither the authorities nor the opposition or for that matter the many citizens' groups in the country have given this consideration the serious attention it warrants. What is of special poignancy also is that after a long period of negative growth from the mid-1970s to the end of the 1980s, the economy had grown at a rate of about 7 per cent per annum in the period 1991-1997. Over that period the only two reliable poverty surveys we have (1992/1993 and 1999) show that poverty had declined from 42 per cent of the population in 1992/1993 to 33 per cent in 1999. At 33 per cent the problem of poverty remains immense. This observation does not diminish the size of the real gains made. The association I have drawn between poverty alleviation and growth in incomes in Guyana does not hold true in all economies. But, for Guyana the evidence in support of this is too striking to overlook.
Pressure on the living standards of households as a result of the long depression aggravates conflicts between communities, races, and political affiliation simply because these are seen as mechanisms for relief. Such pressure also breeds other forms of economic enterprises including, as we shall see when I continue next week, those linked to organized crime, narco-trafficking, smuggling of persons and goods, and money-laundering. To many persons these have become their only source of livelihood, thereby leading to severe repercussions not only within the country but also for its standing in the international community.