NATIONAL INTELLIGENCE SURVEY 95A; GUYANA; THE ECONOMY

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• Collection: NIS
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FOR OFFICIAL USE ONLY
95A /GS /E
Guyana
June 1973
NATIONAL INTELLIGENCE SURVEY
FOR OFFICIAL USE ONLY
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stamlally completed by January 1973.
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uyana
CONTENTS
This chapter supersedes the economic coverage
in the General Survey dated July 1969, which
should be destroyed.
A. Basic characteristics and trends 1
Major resouc ces and deficiencies; level of devel-
opment; British influence in economic life; sig-
nificance of ft reign trade; major economic goals
of the government.
B. Sectors of the economy 3
Cross domestic product by sector of origin.
1. Agriculture, forestry, and fisheries 3
Role in economy
a. The land 3
Use; tenure; colonization.
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b. Agricultural inputs and productivity
Farm practices; mechanization; fertilizer
consumption; government services.
c. Principal crops
Dominance of sugar and rice.
d '.ivestock
Crowth of beef production.
e. Forestry and fisheries
Resources; problems of exploitation.
2. Fuels and power
Dependence on imported petroleum for
thermal powerplants; electric power supply;
expansion program.
3. Minerals and metals
Bauxite and alumina production; other re-
sources.
4. Manufacturing and coast -nuc on
Manufacturing limited largely to agricultural
processing; growth of construction, reflecting
increased public investment.
5. Domestic trade
Relatively advanced cash economy; depen-
dence on imports.
Page
3 13. Economic policy and development
1. Policy
4 Role of the government in the economy.
a. Public finance
5 Nature of the public sector: revenues and
expenditures.
6 b. Banking, money supply, and prices
Banking system; credit policy; price
controls.
7 2. Development
Government strategy; 5 -year plans.
E. international economic relations
0
10
10
1. Foreign trade
a. Trade patterns
Commodity composition; direction of
trade.
b. Trade regulations
Tightening of trade controls; exchange rate
system.
2. Balance of payments
Moderate deficit 1967 -70; surplus in 1971;
smal: reserves.
3. Foreign assistance and debt
Aid from Western and Communist sources;
light debt service burden, despite doubling of
external public debt since 1969.
C. Manpower 10
Characteristics of the labor force; unemployment
and underemployment; productivity and mo-
bility of labor; wage levels.
FIGURES
Page
11
11
13
14
14
15
15
15
16
16
17
ii
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Page
Page
Fig. 1
Economic activity map)
2
Fig.
12
Production of selected manufactured
Fig. 2
Trends in gross domestic product
goods table)
10
chart)
2
Fig.
13
Labor force distribution chart)
11
Fig. 3
Fig. 4
Origin of GDP chart)
Land use (chart)
5
5
Fig.
14
Gross domestic expenditure by end
Fig. 5
Vegetation (map)
5
use (chart)
12
Fig. 6
New settlement area photo)
6
Fig.
15
Government revenues and expend
Fig. 7
Agricultural production table)
g
hrres (table)
13
Fig. 8
Livestock population and meat
Fig.
16
The 1966 -72 public investment plan
production (table)
7
(table)
14
Fig. 9
Greenheart stand photo)
7
Fig.
17
Balance of tradc chart)
15
Fig. 10
GUYBAU facilities, Linden photos)
9
Fig. 11
Producticn of selected mineral
Fig.
18
Direction of trade chart)
16
products table)
9
Fig.
19
Ealance of payments table)
17
ii
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J
N
h
The growth of bauxite production
has made the mining industry of
major importance to Guyana.
Nevertheless, the economy remains
largely agricultural, and sugar-
cane, grown mainly for export on
large foreigr �owned ploatations,
continues to be the most valuable
crop.
Large v heel excavators (right) are used
to mine bauxite deposits lying under a deep
overburden. Note man in foreground.
Sugarcane is transported to mills in barges
towed along canals.
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F
f.
t.
I
The Economy
A. $asic characteristics and trends
Although Guyana is the world's fifth largest hanxite
producer, with extensive deposits of high (tualih,
other known resourc are modest. and the c�ountry
remains largely undeveloped. Economic activitv is
concentrated oil the narrow coastal plain, an area
constittating less than 5e(" of the total but eontaiuing
90 c of the people. Originally based on sugar
production, the economy is gradually diversifying. but
agriculture remains the mainstay, supporting
directly and indirectly about half the popul; loll.
With it total population of less thal, 8(9),(xx), Guyana
affords limif- opportunities for economic ac�tiyity
based on the domestic market. The mostly forested
interior is unexploited except for sonu� logging
operations, cattle ranching in the large savanna in the
south, and bauxite raining and processing (Figure 1
There are no known mineral fuel deposits, and
exploitation of large reserves of timber and potentially
cultivable land is hampered b% their inaccessibilih
and high development costs.
Labor productivity is high in the bauxite and sugar
industries but generally low in other activities. Despite
a relatively high rate of literacy, most Guyanese ore
poorly educated, levels of skill are low, and in many
rural areas people are poorly nourished. As in other
underdeveloped areas, the problem of lack of skills is
aggravated by the emigration of certain types of
skilled labor in search of better opportimities, and the
need for skilled personnel exists side by side with high
rates of unemployment and underemploynient.
Moreover, the economy hears a heave dependency
burden, as almost half the population are in the
dependent age groups.
Despite some product diversification, agriculture
remains basically export oriented. Sugar �grown
NOTE �The entire content of this chapter is L'N(:1 A SSI1.11 :I)
but is FOR OFFICIAL USE ONLY.
mainly em large foreign -owned pl- nIations alid
rice�grown primarily on small family farms
account for 70 of agricultural output and Wi of
Guyana's export earnings. Although some slash -and-
bum agriculture is evident, subsistence farming in the
strict sense of the word appears to be conunon only
among the small number of Amerindians in the
interior. Efforts to expand and diversify agriculture
reflect the government's goal of reducing dependence
on imlmrted foodstuffs Although outpat of minor
f ad crops and livestock products has increased since
the mid- 1960's, about one -third of the caloric intake
consists of imlxrted foods.
Bauxite is mined and processed by a goyernmeat-
O\%ved company (a forme subsidiary of the
Aluminum Co. of Canada, nationalized in Jule 1971
and by a U.S. owned firm. Bauxite and alumina
account for almost all mining output, diamonds and
gold being mined only on if small scale. Despite
mining's large contribution to output and exports, the
m-ctor s capital intensi ones, sharply limits the role of
nainicg as it source of employment.
Owing partly to protective tariffs and government
financial incentives, the nnulufac�turing sector has
grown steadily throughout the last decade, but its
contribution to the Bros domestic� prodiiet (GDP) and
enp1m mcnt remains small. 'I'll(- processing of sugar.
rice, and other agricultural products accounts for most
of the output.
Reflecting the narro%% resonrc�e base, economic
growth generally has been only moderate. During
1967 1, GMI grew at an average rate of ahont 4
annually in real terms (Figure 2). large private
investments in bauxite mining and processing and.
since 1968. expanded public investment stimulated
most of this growth. Reduced hanxite and agricultural
output and decreased private investment led to an
estimated 2.W(' decline in (:)P in 1972. Per capita
in 1971 \vas only US8385, well below the Latin
American average.'
While ties with the United Kingdom have
diminished since the gaining of independcuce in 1966,
Guyana remains it mcinher (if the Bri! Common-
wealth. British influence is still strong in the economic
life of the conntry and is clearly evident in business
practices, patterns of ownership of economic
enterprises, and the direction of trade. Most of the
large; agric�ultnral, industrial, and commercial firms
arc owned and operated by British citizens. Although
'Iii this chapter %;dues originall\ eyres-d in Guiana (lollars
hace peen rtinnerted into U. S. dollar% the rate of C32 UW. the
official rate unlit Dime 1972. %%11'.11 the Cmalla dollar began floaifig
ssilh the pound sterling at the rate of 0
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INDUSTRY
MINING
b/ %feat packing
Al Bauxite
c,toa� milling
Au Gold
e Food processing
C Diamonds
or Sawmill: wood products
KuniaAl 1
e Machine and metalworking
FISHING
Bauxite processing
Fishing area
0. Shipyard
Mandia
C4 Lumbering
AGRICULTURE
Sugar
Rice
_i
I Coconuts
Masarum
Cattle
Matthews
Ridge I nty
A)e e
Au
a
GOP
eartica Au
New Amste
C w Tumerenq 4" g
8
At
C Au Linden
Everton
KuniaAl 1
Tumatumari-
C Au Kwakwani At
Mandia
C
V
501734 4.73
FIGURE 1. Economic activity
its relative imporluuce has declim d, tar U,litvd
Kingdonn �along with the United Slates renlaius
Guyana's most imporlunt trading partner mid uid
donor. I or example, about two thiAs of Guyun;n's
sugar exports ore directed to the United Kingdom
under the Commonwealth St gar Agreement.
`iloreover. ;t significant purl of Guyana's foreign
exchange reserves are still held in sterling, although
the shore has been reduced since 1967.
As part of its colonial legacy, the ec�ono m% remains
high1v dependent oil foreign trade. 1 ?xports and
imports each equal nearly half of GDP, well above the
average for less developed countries. An estinunted
Wil of personal income is direc�tl% or indirectly
derived from foreign trade. The dependence% uu
foreign trade has fostered a relatively adranc: d mon,-y
economy, however. with less than Ski of Ill econonuc
transactions curried out on I nonc�ush basis. 'I'le
foreign orientation also has helped to nake available
in the principal towns Georgetown. \e%y Amster-
dam, and Linden �goods and services gvnerally
comparable to those found in more ec�ononiic�ally
advanced countries.
Under Burnham, Guyunu has pursued it polio of
increased independence in domestic and foreign
affairs in um effort to improve the nation's economic
well being. I?fforts to gain +,reater domestic control of
resource exploitation and to redttc�e dependence on
traditional products and markets havv l -d to the
nationalization of the major bauxite producer.
inereased governnunt economic diyersific�ation
nulsures, and accelerated steps to expand the still
small economic role of cooperatives. 'Phis prlic% has
also resulted in melisums limiting new private foreign
itn�estnu�nt involving exploitation of the c�ountry*s
natural resources to minority partnerships in joint
ventures with the government or cooperatives.
Externally, the country has expanded trade tics with
the 'I'hird World mid Communist countries. This is
exemplified by Guyamu's efforts to play it major role in
the Caribbean Free Trade Association (C:ARII -'I'A)
Ind Guyana's growing� though still relatively
unimportant �trade relations with the People's
Republic of Chino and the U.S.S.R. Despite such
m. astires, however. Guy;na remains heavily
dependent on its traditional markets for export
earnings and imports.
The Burnham gc;vernrnent's measures to increase
domestic control of resource exploitation especially
the nationalization of the major bauxite enterprise�
and other major economic policies have c�rcated a
c�linunte of business uncertainty aril }t sharp loss of
investor confidence. During 1971 at least one major
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FIGURE 2. Trends in gross domestic product

private trading enterprise closed. sons private
domestic ill vvM men I phut% %%en� slicked, and the
inflo%% of fon�ign investment .1111140 ceased. Because
the vemiomy is largely dependent on private domestic
and foreign imvstnteut for expanding economic
ac�tivih, it prolonged peri,,d of business mtcertain1%
and lack of confidence amt1g investors would r�sctlt
in au c�xtertded slowing down of economic gro%%th,
Such a situation could lead to bctdgetar% and balance
of paytnen;, difficulties, leaving little hope for the
achievement of ambitious new polio% goals.
H. Sectors of the economy
Deflecting partl% the high cost and slow progress in
developing Guyana's rural res4urevs. the relative
importanev of agriculture, forestry, and fisheries has
declined since the early 1960 *s Figure -3). Al the same
time the growth of bauxite production has increased
the co tribution of mining. Output of the
manufacturing, construction, and public sectors ubo
has generall% outpaced wwralf ecommic growth since
19(il, thus increasing their proportionate ,hares of
GDP.
1. Agriculture, forestry, and fisheries
Agriculture, forestry, and fisheries account for about
one -third of the labor force and contribute dino.,t half
of total export earnings. Largel% because farming is
oriented to the production of sugar and rice mainly for
export. Guyana imlxrts about one -third of its food
w(li irements. Government attempts since 1967 to
stimulate crop diversification and increased outlut of
livestock products have met with some sucee,s, but
total agricultural production has gro"ii only
Moderately. Moreover. Guyat,a is unable to produce
totally temperate zone foodstuffs. notably wheat.
a. The land
Guyana has one of the highest land population
ratios in South America, but the� amount of c�ultiyated
land per capita is below the continental average. Ottly
about 12ii of the total land arcs is devoted to
agriculture and less thin I r; is under cultivation
Figure 4). The agricultural area is small mainly
because of the high cost of draining the swampy
lowlands in the coastal area and along the rivers and
the difficulty of access to the interior Moreover,
drainage is complicated by slow water runoff, and
Guyana, which is part of the Amazon� Orinoco
w.1tershed, is subject to extensive flooding daring the
semiannual rainy seasons.
Crop production is confim-d prinmril\ to the
,outheastern two- thirds (if the narro%% coaslal strip
where� the soils are rich deposits oyerlaykig
scuds and clay. This arcs has been cleared from
martgrcye %%vamp, and a complex and expensive
system of seawalls and druinuge canals has been built.
A limilml amount of land also has been cleared b
:Wwrimlians for !hifting cult.`vuliou in the interior
primarilmi along the flood plains of the principal rivers
and in the foothills of the mountains. South of the
coastal area lies the msll\ unused forest zone (Figure
5), which covers more than :35 million acres, or about
two- thirds of the total land area. Soils in much of the�
interior are poor or would require careful management
for successful farming. In the savanna of tit(-
fictptrtumi District, southst�st of the forest zone. cattle
are raised.
'I'lte 4oyerntnent holds till� to more than 90' of
:uy:tna's land area, including most of the agric�ctlturtl
land. sshic�h it lease% for private use. For example, the
grazing lands in the liupununi District are leased to
r.1nc�hcrs on it "permission of occupancy" basis. About
one�- fourth of the cultivated arc: is owned by large
sugar estates. bolt small farms lease most of the
remainder.
The government has initiated several c�ol4nization
project in widely scattered locatir its in the interior.
TlIVse projects, in itich the gmernna�nt clears and
prepares the laivi for c�ultiyation provides houses and
necoss :m public services. mid leases the land to pri\ ate
farmers. have proven yer\ mpersiye. the governnu�nt
is now stressing expatsior of existing prcjec�ts to lower
colonization costs Figure 6).
b. Agricultural inputs and produc deify
E\cv�pt cn the Ltrge sugar estates, agricultural
practices are bac�k"ard bs Lati11 :Uwrican standards.
and productivity is logy. Because seasyalls and
drainage and irrigation facilities are needed in th^
main agric�ultur,tl areas, costs are high. Mechanization
is extensive on the large sugar estates and a few larger
rice farms but is very limited elsewhere. In 1968. there
were about :3.66 tractors in use. or one for (very 120
acres (if c�ultiyated land. Fertilizer consumption is
fairh large. totaling some :3-10M) metric tons in
1970 �about 70 kilograms per acre of cultivated land.
The government has attempted to stimulate
introduction of modern techniques, especially in rice
farming. and has provided extension services.
Technical information is disseminated by the Rice
Marketing 13card (11MB) and the Guyana Marketing
Corporation ((:M(:1, the government marketing
:3
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agency for other farm products. The goverttnent has
established a 2 -year agriculheral school amt also
provides instruction programs for settlers participating
in colonization programs. Since IM9. the governn etit
has been irnPlctncnting an $1,% million rice
rehabilitation program finautced partl% by the V.S.
Agency for International Development (All)). The
program entails construction of six rice- storage centers
and several "tills, esta Ill ishntcnt of at rice research
shidon. and provision of extension services.
c. Principal cropx
Sugar and rice, the two most intlmdant crops,
account for about 71)c( of agricultural oWmit. Bice
cultivation occupies almost three tithes as !uttch land
as sugar and provides more than twice us touch
etnploy"tent, hilt the value of the rice crop is only
about one third that of the sugar crop. The
government has intensified efforts to stimulate
production of sugar and rice and it number of minor
crops, cslx- cially corn, soybeans. and sorghum. For
example, experimental farms have been established for
some minor crops, and in :)ecenther 1971 import
prohibitions were introduced for mane food products
to provide Further incentive to domestic producers.
Sugar is grown nnninl% on 1:3 large estates. all of
which are owned by hyo large British companies�
Bookers Sugar Estates, Ltd.. and Demerara Co., Ltd.
A small though increasing share of the crop (.c.5'': in
1971, compared with 51f' in the 19610's) is grown orn
small farms, a few of which are organized it)
c(mix-ratives. As it means of encouraging production
on small farms. the govenunent created the Cane
Farming Corporation in 1969 to provide financing for
their cleveloptnent. The large estates mill both their
own crops and those of life small producers and
semirefine it small amount of %agar for domestic
consumption. Eximrt% are in the form of rase sugar.
molasses, and rum.
Since the tnid- 1960's sugar production hats
recovered� allwit erratically �froth disruptions during
the social unrest of the earl, MO's, reaching it record
volume in 197) (Figure 7). Daring the latter part of
this period, prcxluction was frequenll% disrupted b%
labor strikes, mostly invol -ing attempts by tit(.
oppcnition- backed sugar workers' union �the Guyana
Agricultural Workers' Union (GAWL' �to gain
recognition from the govenunent.
The United Kingdom and the United States buy the
major p0ion of Gttyana's raw sugar exports (2-14.8M
and 92,-100 metric tons, resix-ctively, in 1971 and
Canada itnlxrts the remainder (6,2M tons in 1971
4
Most sugar %ale% to the United Kingdom corn(. under
OW Conunonw(.allh Sugar Agreement (CSA) of 19.51,
which getarantev% a price usually above that
obtainable on the world cctrket, but the agrvvmeut is
not binding after 19; -1, and the entry of the United
Kingdom into the F orupeati F.couonnie Cotnnnuuity
milk(.% the future (if' In, r:SA uncertain. Sal, to li t(
United States arc incluk�-d under tit(. U.S. "not: for
t ite West Indies
Rice productio" expanded rapidl% in the early
1960*s, reaching it peak in 1965. Since then output has
teneh'cl to decline. partl% because of tit low(.r prices
paid to producers b% the Bice Marketing Poard-
01%'ana's exclusive rice marketing agent. lu addition
to meeting domestic n(.(.ds� averaging about 5011 of
production �the board exports rice tinder bilateral
agreements to several other CA11IFI'A members at
prices normally well above international quotations.
Before 1965 rice was also exported to non- CARIFTA
countries, but following the output decline such sales
have become negligible.
Bice is grown mainly on small fancily plots h% 1 ?ast
Indians under extremely labor- inteosive methods.
Only Ecuador and Brazil hay(. lower yields in South
America. while yields in neighboring Surinam arc
more than twice as high. Gu%ana's lo%% productiyih is
attributable principally to s"na!l capital investment,
poo drainage, and the planting of Iow yielding
%aricties that are unresponsive to fertilizer,. Although
the government Inns toadv some effort to encourage
introduction of higher yielding, quicker maturing
varieties from tit(. United Slates, producers ha%v
insisted because tit(. increased yield is frequvntl%
inacicquaty to offset higher costs.
Coconuts constitute Guyana's third largest crop in
terms of area planted. Greater coconut output is
desired by the government to provide increased
supplies of copra, edible coil, soap, and margarine,
local'detnand for which exceeds the supple. I ?xpansion
of covouut production, however, is discouraged by
thi(.yrry and the low price of copra, which make the
crop unprofitable. Coffee, production of which has
declined since 1968, is the most important minor
export crop. Some coffee is shipped to tit(. United
St.ttes for processing into instant coffee and return to
Guyana. Cocoa, as it trey crop, is especially suited to
the northwest. Production of citrus fruits and bananas
is increasing because of favorable domestic and
foreign demand. Plantains, various tubers, and other
vegetables are produced for domestic consumption in
home gardens and on small farms.
0
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Millions of 320.4 428.8 566.6
Guyana
Dolia Iov.
Other 1%.6 9.7 9.2
Government 10.5 13.2 13.5
Commerce 13.5 11,9 11.3
,rrans,)ortatton 5 7
and 7.q 8.8
6.5
Communications
6.7
Construction 7 2
Manufacturing 10.9 12.3 12.2
Mining 12.9 17.6 180
Agriculture.
Forestry,
and 26.9 22.1 21.3
Fisheries
1961 1967
FIGURE 3. Origin of GDP
TOTAL LAND AREA
83,000 square miles
Forest
65.9%
1971
tsuil p YIL2%
inland water, area,
wastel and Ag
I
21.996
ssland end
pos ture
Cultivated land 11.370
0a%
Rice Sugarcane 1 10 9 70
5 22 70
Coconuts
Other
FIGURE 4. Land use
am Dense trop,cal lures
Seasonally flooded t
with scattered mar
Grassland or �an,
Cult, rated land
501736.473
d. Lit-esh)ck
(:attic raring it till. Ino.t iniportant Ii%cslock
acli\it%. I)cclopuunt of commercial beef c�attlt-
raising %%its initialed in the late 19511*. Mten the
gmrrnnu�ut hcgan grioitiug leases to till' liupunuui
District grasslawls for this purpose. Sparseness of
srgclalion and wrions inineral deficiencies it: the
.aV:tnllit soils, It( %%v%vr, keep grazing land retluirc�-
nu�nls high- onlc 311 to 70 acres per head of calllc�
aud thin impose w%vre limits ou the cattle population
that these lands c a support. I- irtI writ tire. th:�sc
grasslands art� located far from nntrkcls. aucl because
of it lack of adctluatc ground transportation bulchercd
ntc:tt is shipped b% air to (:eorgeto\\n. (:onseyucntl%.
nu)st beef cattle still are raked on small farms on the
co:lst on i t noncommercial basis.
Hc(lecling tII( e\pausion of graving I:utcls, the c�aItIv
population ;use snhslanliitII in the e :trl\ I Wit
l s
I Figure tit. Since 1965. ho\\c\ expanded beef
Inodnction has been lltmel\ responsible for lo\ler
cattle ininibers. Mainly as if result of cattle dietar\
deficiencies. the yualit\ of :u\ancse bcel is lo\c.
Despite gmater production, Guy :In;t conlinucs io
depend parll\ oo imports for beef supplies.
S\\inc, sheep, and goals are raised and consuned
n)aillk on small fartm. In Decerttbo r 197 1 the
goventntent sought to stitntllate s\\ine raising by
slopping iinporls of sonic pork products and
5
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FIGURE 5. Vegetation

employing full -tine' swine pronioti:on specialists. In
the lust decade poullrr raising has been expanding.
and specialized potiltry farms have become
increusing:y conimon.
Commercial dairy farming is litnitetl to the coastal
areas near Georgetown and New Anisterdant. The
government -owned past Ctirization plant at Ce(irge-
town processes milk f(r (Ioniestic cousuuiptioi, but
milk and milk products are still iuporled. The
government is utt(�mpting to espun(I supplies of dairy
products by improving cattle bree(Is, increasing the
land available to dair%nien, an(l establishing
additional processing plants.
C. Forestry and fisheries
%ithough two- thir(h of the total lan(1 urea art-
fomsted. production of timber pro(lu is accounts for
0111% 1.51( of (A)II. The contribution is .mall ntuiul
because of the (lifficulty of access to and (ltialit% of tilt-
forests. which are characterized b% e%Irettu'
hCterog(.I ,itv of species an(I b% small tree si /es.
ConunCrciall% valuable species are intersp-�rsCd "ith
unattractive ones so that %iCl(ls are snwll. ields are
also sn11111 because the (titer sap"(w(I (f the most
valuablC species- greenheart. purph-hear!. and
wallaby -is snbjCCl to rapi(I clecac once the tre(�s arc
FIGURE 7. Agricultural production
(Area :n thousands of acres, production in thousands of metric tons, except as noted)
6
nami
Produc
Area tion
125.3 374.7
233.6 121.9
3.1 0.5
na 45.0
na 49.3
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FIGURE 6. Part of a new settlement area along the highway from Georgetown to Linden.
The tree stumps are vestiges of the forest that was cleared for new farms; here the
earlier vegetation is being replaced with pineapples.
1967
1965
1960
970
Produc-
Produc-
Produc-
Produc
A,rea
tion
Area
tion
Area
tion
Area
lion
Sugar, milled
115.3
349.4
107.5
:321.9
126.0
370.2
107.3
316.1
Rice, milled
253.5
125.9
313.1
135.9
_i9.3
112.7
294.3
144.6
Coffee
3.1
1.3
:3.1
1.3
3.1
0.7
3.1
0.6
Coconuts
44.2
36.3
45.4
55.2
46.1
60.5
47.0
5(1.0
Tubers, roots, and plantains.
24.3
42.4
21.5
41.3
23.1
46.2
26.3
45.9
na Data not available.
*Coconuts: Area in thousands
of trees: production
in millions
of nuts.
6
nami
Produc
Area tion
125.3 374.7
233.6 121.9
3.1 0.5
na 45.0
na 49.3
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FIGURE 6. Part of a new settlement area along the highway from Georgetown to Linden.
The tree stumps are vestiges of the forest that was cleared for new farms; here the
earlier vegetation is being replaced with pineapples.

FIGURE 8. livestock population (in thousands) and meat
production (in metric tons)
cut, reducing lumber t.t ()nl% :35'( to 55`( of
the total %%eight cart.
'1 exports consist ()f groenheart (a luta e())(1
used in marine constructinn). %%allaha (nalnralk
srlited for utilih poles). wad nrora (its( for railroad
ties and utilit% crossarns). I'ro(Inction of greenheart
Figure 9), the most important, has decliared from I A
million cubic meters ill 1965 to 0.9 million ill 1970 as it
result ()f increased use of cmicn�le in flier construction
and gra(Iual exhaustion Of accossiblV timber. I?'xports
()f forestr% products totaied about USS1.2 million in
1971).
Other spvcies ()f timber are cut for donn�stic use in
boat constriction. hnuseiruildint, and the pr( It in
raf fnrnitltre, matches, and agrie;tltural inlplenu�uts.
Some, like kauta and %,rani� dirvOIN as fool ()r
are processed into charcoal. The use imported hite
(line is gradttalk being replaced b% doruostical1%
produced soft hard%%oo(Is such as siniatntpa. dalli. mid
silverballi.
Under the direction ()f the government nnnu�rous
advances in timber grading and handling have boon
made since If)66 to inipro%e (()rest exploitation.
Nevertheless. significant expansion ()f timber and
%%ood products ontpnt %%ill re(luiro imprnsod
transportation to the inlorior, poker. and
more efficient plant ()pentlions and marketing
proved a ros.
Commercial fishing is linlite(I larger to shrimping
()ff the coasts ()f Brazil. Strrinarn, and I re�nch Giflana.
Most of the catch is obtained b\ U.S. firms. \%hich
ship the bulk to the U.S. market. Dvinaud for shrimp
has been strong. output has been rising rapidl\. and a
substantial in%estment has been made in tr.t\\lors and
processing facilities. I:xporls in 1971 anronnlod l()
5.000 m0ric loins. \wtrtft sumo US$9 tnilli()n, oralnamt
7 of total oxnorl earnings. 0) ernn;ont oflorts to
eneuntago expansion ()f the catch of other fish species
for donu�stic co ()stimplion thus far have met \cit11 little'
success. The Iishing in(lustr\ accounts 1'()r 2'f
2. Fuels and po%ver
;;naua has n() knm\n c( )a petroleum. ()r ga.
(I(�Imsits. Almost all olociric is prod(t(�ed b\
thermal plants, fuele(i mairk %%ith imported oil.
Ilouseholds and Haug industrial and common d
facilities, h(a%re\or. its(- \%OO(I and charcoal for fuel,
s hit( the� sugar mills else-bagasse. I I dr(u�loctric po\%cr
potential �in lh(� mouutaiuolts \(ester( Dart of Ill(
colt:ilr% �is largo, but (1(�s(�Ioltt11e�nt has bee()
hampomd b\ the remote I()cati(m and (�ostl\
in\(�sttnenl ro(Iuironmcnts.
N
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FIGURE 9. Greenheart stard. Mature trees reach up to
40 meters in height. Wood of greenheart is extremely
hurd, heavy, strong, and immune to decay and marine
borers.
191111
1965
1969
14711
1971
Cattle:
Population
160
350
257
257
cue
Beef production.....
2,811(1
:3,897
�1,24(1
-1,M0
�1,257
Swine:
Population
20
fM)
81
83
na
Pork production.....
286
1112
I lS4
1,200
1 442
Sheep:
Population.........
fill
87
98
97
na
Nlutton production..
6
35
62
54
it
Poultry:
Population.........
398
3,000
6, 450
7,32:5
as
Meat production....
497
954
2.705
3,382
3,719
as Data not available.
cut, reducing lumber t.t ()nl% :35'( to 55`( of
the total %%eight cart.
'1 exports consist ()f groenheart (a luta e())(1
used in marine constructinn). %%allaha (nalnralk
srlited for utilih poles). wad nrora (its( for railroad
ties and utilit% crossarns). I'ro(Inction of greenheart
Figure 9), the most important, has decliared from I A
million cubic meters ill 1965 to 0.9 million ill 1970 as it
result ()f increased use of cmicn�le in flier construction
and gra(Iual exhaustion Of accossiblV timber. I?'xports
()f forestr% products totaied about USS1.2 million in
1971).
Other spvcies ()f timber are cut for donn�stic use in
boat constriction. hnuseiruildint, and the pr( It in
raf fnrnitltre, matches, and agrie;tltural inlplenu�uts.
Some, like kauta and %,rani� dirvOIN as fool ()r
are processed into charcoal. The use imported hite
(line is gradttalk being replaced b% doruostical1%
produced soft hard%%oo(Is such as siniatntpa. dalli. mid
silverballi.
Under the direction ()f the government nnnu�rous
advances in timber grading and handling have boon
made since If)66 to inipro%e (()rest exploitation.
Nevertheless. significant expansion ()f timber and
%%ood products ontpnt %%ill re(luiro imprnsod
transportation to the inlorior, poker. and
more efficient plant ()pentlions and marketing
proved a ros.
Commercial fishing is linlite(I larger to shrimping
()ff the coasts ()f Brazil. Strrinarn, and I re�nch Giflana.
Most of the catch is obtained b\ U.S. firms. \%hich
ship the bulk to the U.S. market. Dvinaud for shrimp
has been strong. output has been rising rapidl\. and a
substantial in%estment has been made in tr.t\\lors and
processing facilities. I:xporls in 1971 anronnlod l()
5.000 m0ric loins. \wtrtft sumo US$9 tnilli()n, oralnamt
7 of total oxnorl earnings. 0) ernn;ont oflorts to
eneuntago expansion ()f the catch of other fish species
for donu�stic co ()stimplion thus far have met \cit11 little'
success. The Iishing in(lustr\ accounts 1'()r 2'f
2. Fuels and po%ver
;;naua has n() knm\n c( )a petroleum. ()r ga.
(I(�Imsits. Almost all olociric is prod(t(�ed b\
thermal plants, fuele(i mairk %%ith imported oil.
Ilouseholds and Haug industrial and common d
facilities, h(a%re\or. its(- \%OO(I and charcoal for fuel,
s hit( the� sugar mills else-bagasse. I I dr(u�loctric po\%cr
potential �in lh(� mouutaiuolts \(ester( Dart of Ill(
colt:ilr% �is largo, but (1(�s(�Ioltt11e�nt has bee()
hampomd b\ the remote I()cati(m and (�ostl\
in\(�sttnenl ro(Iuironmcnts.
N
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FIGURE 9. Greenheart stard. Mature trees reach up to
40 meters in height. Wood of greenheart is extremely
hurd, heavy, strong, and immune to decay and marine
borers.

Because of Guyana's proximity to the :oilfields of
Venezuela and Timidad and 'Tobago, the country has
attracted the interest of several foreign oil companies.
Extonsive exploration in the late 1950's resulted in
discovery of favorable geologic formations in coastal
and offshore areas and in the near interior, but several
wells drilled by Standard Oil of California during
1938 -60 and more recent efforts by other companies
have yielded negative results. Exploration has been
marked by frequent turnover of the companies
holding concessions.
The electric power supply is generally adequate to
meet demand but will require expansion to support
further residential usage and industrial growth.
Generating capacity ancounted to ail estimated
1 12,000 kilowatts (key.) at the end of 1971, and output
approximated 340 million kilowatt -hours (key. hr.).
With a per- capita production of 460 kw. hr., Cuyana
ranks eighth in South America. All powcrplants arc
thermal with the exception of it 940 -kw. hydroelectric
plant at Tumatumari on the Iotaro River.
About 805(' of electric power consumption is
accounted for by commerce and industry. R,sidential
usage accounted for about 195f', while other activities
such as transportation and public lighting used the
remaining I Consumption is concentrated in the
Georgetown area and in Linden, where it large part of
the hauxite industry is located. Generating capacity is
concentrated in the coastal region extending southeast
from Georgetown to the Surinam border, and at
Linden. The coastal facilities make up 62( of total
capacity, and those at Linden :3ISr' The remaining 4c/,
of capacity consists of municipal facilities in small
towns.
The Kingston powerplaut, with it capacity of 4231X)
kw. is the largest installation. Owned by the Guyana
Electricity Corporation, it government agency, the
plant supplies both public and industrial needs in the
Georgetown area. The plant is interconnecied with
several small public -owned powerplants to make up
the country's only transmission grid, which has a
capacity of 46,500 k%v., or approximately 42 /i of the
national total. Most of the remaining capacity is in
powerplants owned and operated by private interests,
mainly the mining and sugar industries, which also
supply public needs in adjacent communities.
A 4-year expansion program to be financed by the
World Bank, Canada, and the United Kingdom was
scheduled to get underway in mid -1972. Included is
construction of two n,ew powerplants and it 69 -kv.
transmission line to connect Linden with the
northeastern part of the country via Georgetown.
8
:3. Minerals and metals
Mining and mineral processing in -1971 accounted
for 5054 of export earnings. 'I'll(- sector is dominated by
bauxite extraction and processing into netallurgical
and chemical grade bauxite, calcined bauxite, and
altimiila. Guyana produces small amounts of gold,
diamonds, and quarry products. Under extensive
exploration work, carried out since 1965 with the
assistance of it U.N. mission, deposits of copper,
nickel, and molybdenum were discovered, and several
are being studied to determine their commercial value.
Guyana, the world's fifth largest producer of
bauxite, accounts for about 6 of world output.
About 70 '/b of the estimated :3.9 million metric toils
produced in 1971 came from the state -owned Cu% u a
Bauxite Company (GUYBAU). GUYBAU was created
in July 1971 when the government nationalized the
Demerara Bauxite Co. (DENIBA), a subsidary of the
Aluminum Co. of Canada. Reynolds Guyana Mims, it
wholly owned subsidiary of the U.S. Reynolds Metals
Co., produces the remaining 30`,v of bauxite output
about I million tons annually.
Bauxite deposits occur ill a 200 -nile long and a 6-
to 40 -mile -wick belt extending southeast fron tl c
Ponu�roon River in the north to tit(- Courantyne River
oil the Guyana Surinam border. Cuyanese bc,uxite
mining is high- compared with that in other
countries because the ore deposits lie under it deep
ovc,rhurden and are located far from deep water ports.
The high extraction and trusportation costs are
compensated, however, by the unusually high duality
of the Guyanese ore. Assured bauxite reserves are
estimated at 80 million metric tons; probable reserves
amount to un i,dditional 2:50 million toils.
More than half of Guyana's bauxite is exported as
dried metal grade ore for use in making aluminu n
and, to it lesser extent, as it filtering agent. Some 15 "1
to 2051 of the crude bauxil, is refined into alumina for
export. Reflecting the ore's high quality, it growing
portion is being processed into calcined bauxite for
nonmetallurgical use� such as refractory malcrials and
industrial abrasives.
GUYBAU's facilities are located at Linden, some 60
miles p the Demerara River from the coast (Figure
10). The� mining complex includes facilities for drying
up to I million metric tons of hauxitc annually and for
producing up to 650,000 tons of calcined bauxite and
35009) tons of alumina annually. 'I'll(- operations of
Reynolds Metals Co. are ceutewd .t Kwakwani, about
80 miles up the Berbiev River from tl� coast. Bauxite
from Kwakwani is shipped by hi:rge to Everton (near
New Amsterdam), when, it is dried and transferred to
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`t
oceangoing barker. Reynolds colliplelt-d it l'SS15
million expansion progr in in 1968 that tripled its
capacity to about I million tuns of illetallorgical grad�
bauxite :uuhually.
Bauxite and aluniina output inervased during the
1960's in resirmse to gro%%ing %%orld"ide dvimind for
aluntinunt (I igury I I I. Some US89C million %%as
invested in expansion programs during this period. :M
the� saint- tirov. tilt- product niix changed considera h1%,
with gro%%ing emphasis on alumina and calc�int-d
bauxite. of "Itich Guyana has it virtua! monopole.
:1l111ough of 'put of calcined huiixite contin ied to rise
in 1971, hnt-tallnrgic�al grult- hauxitr production
declined, reflecting the depressed %%orld market for
alnnimmn.
(hitl)ut of both gold and diamonds fell in 1971 to
their lowest levels in 114111% Nears. '1�lu�% are mined b%
hand front alluvial deposits along streams flowing out
of the Pakarainrai \lounlitius. Placer gold deposits
appear to be substautiall\ t-xhaisted, and large scale
exploitation has been discouraged b\ inac�cessi Ili Iit.
Manganese \%as produced until 1968. ss hen rising costs
Mid declining world prices forced the closure of tlilt-
U.S.- o"lled mire� at Mattliv"s Ridge.
FIGURE 11. Production of selected mineral products
(Thousands of metric tons unless otherwise specified)
9
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FIGURE 10. The Guyana Bauxite Company (GUYBAU) complex in linden includes a
calcining plant (tip) and ore loading facilities on the Demerara River. Bauxite and alumina
are shipped d,wn the river on oceangoing vessels.
1961
1963
1965
1967
1965
1969
1970
1971
Dried bauxite
1,375
980
1,260
1,753
1,551
2,139
2,327
2,135
Calcined bauxite
377
358
492
474
597
654
705
721
Alumina
134
227
279
277
269
303
317
310
Manganese
215
142
169
179
99
0
0
0
Gold (Thousands of ounces)
1.7
2.8
2.1
2.4
4.1
2.1
4.4
1.4
Diamonds (Thousands of carats)
113
100
113
97
fib
49
59
.17
9
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FIGURE 10. The Guyana Bauxite Company (GUYBAU) complex in linden includes a
calcining plant (tip) and ore loading facilities on the Demerara River. Bauxite and alumina
are shipped d,wn the river on oceangoing vessels.

4. Manufacturing and construction
The manufacturing sector produces a variety of
items, including foodstuffs, clothing, furniture, and
small boats. Guyana's limited raw material base has
restricted manttacturing largely to agric�trltural
processing. Moreover, the small domestic market
inhibits the establishment of a significant imlxrt
substitution industry, although there are some small
assembly plants using i- mported components and
materials. Manufacturing output grew about 8'('
annually during 1967 -7 I. Nevertheless, Guyana
continues to depend on imports for most of its supplies
of manufactured goods. Production of selected items is
shown in Figure 12.
Sugar and rice milling account for about one -third
of manufacturing output. Ten of the I I sugar mills are
controlled by two foreign- mviied companies �the
major firm being Bookers Sugar Fstates, late!. (dice
milling, on the other hand, is carried out by nunu�rous
small private and a fe%y large government -owned
mills. The remainder of the sector is cornpowd or
numerous small e nterprises located mostly in
Georgetown and A ig th(� cast bank of the Demerara
River, where electric power and transport services are
readily available. About half of these process
foodstuffs and tobacco.
The London firm of Booker Brothers, McConnell
and Co., l.td. (also known as the Booker Group) is the
most important of the several foreign -owned firms
active in Guyana. In addition to its sugar interests, the
Booker Group is involved in a wide variety of other
agricultural, industrial and commercial activities. It
produces rum and gin, operates the largest department
and grocery store in Georgetown, and is engaged in
printing, tire recapping, and the mail of
pharmaceuticals, stockfeeds, and building materials.
Following a lull during the early 1960's,
construction recovered strongly, reflecting the increase
in public investment. Value added by construction
expanded at an annual rate of 15r,(' during 1967-71. or
twice as fast as the a co nom% as a whole. raising
construction coiotribution to (:DP to 9`4. During this
period, traditional wood construction has been
replaced to uunc extent by brick and concrete to
minimize ti t(- hazard of fire, which has Ix�riodiealk
swept Georgetown. &�cause no limestone or cement is
produced localh, this shift has increased cYntstruction
costs and deli- ndence on imports.
5. Domestic trade
Compared with other less developed countries,
Cuyana has a relatively advanced c�asl �cononty.
Modern goods and services comparable to those found
in smaller American cities are general) available in
Gcorgchwn and throughout much of the coastal strip,
although tlc� lack of adceluate� translxrt facilities
hinders the efficient marketing oV food. Most priyalc
consumer services are also available on plantations
v..nd in mining c�onimni ities but are lacking in
independent rural villages. Public consumer services
are generally inadequate�, particularly in rural areas.
Be cause of the lack of domestic produe�tion of many
goods, domestic trade is closely tied to imports. Many
of the larger wholesalers and retailers are subsidiaries
of foreign -owned firms engaged in foreign trade.
Imported goods still are often preferred to domestic
counterparts, reflecting both the low quality of the�
latter goods and patterns and preferences established
during the colonial era.
C. )Manpower
I'll(- percentage of the populatim! in the labor force�,
though about "verage for Latin America, is
substantially lower than in more economically
advanced countries. where a large proportion of
females arc economically active. In 1970 �the date of
the last official census �the labor force (persons 14
years of age and over, employed or seAing
employment) was estimated at 2010H), or 29(' of the
FIGURE 12. Production of selected manufactured goods
1961 1963 1965 1967 1968 1969 1970 1971
Edible oil (Thousands of gallons) 925
Margarine (Thousands of pounds) 1,707
Rum (Thousands of gallons) 2,791
Beer and stout (Thousands of
gallons) 760
Soap (Thousands of pounds) 3,994
Cigarettes (Thousands of pounds). 776
Matches (Thousands grosses of
boxes) 191
619
653
888
893
699
791
890
1,561
2,096
2,414
2,189
2,564
2,349
2,641
2,539
3,643
3,406
3,276
3,201
3,229
3,781
681 1,083 1,351 1,134 1,249 1,391 1,389
4,073 4,851 3,968 4,400 4,707 4,962 4,727
636 809 826 859 863 926 954
169 201 197 197 176 213 107
10
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totai population. T he most recent complete survey of
employment, carried
out in
IW5, indicated
the
following labor- force participation rates by
age group
and sex, in percent:
MALE
FE \[ALE
TUTAI.
14 -19
51.7
25.7
38.8
20 -24
96.2
36.1
64.2
25 -29
97.9
30.2
63.4
30 -44
97.6
30.1
61.7
45 -59
93.6
35.0
65.7
60 and over
49.8
15.6
31.3
Total (14 and over)
81.8
29.3
54.9
According to the March 1965 survey, the largest
portion of the labor force was in agriculture (Figure.
1:3). Because a substantial part of the unemployed
were agricultural workers, the actual share of the labor
force in agriculture came to about Wi.
The la.hor reserve is small. Few of the approximately
20,000 Amerindians still gathered in reservations can
be assimilated into the labor force. Of the remaining
TOTAL
174,772
Agriculture*
43,922 (25.1
Manufacturing
24,302 (13.9
Services
27,247 (15.6
Commerce
18,941 (10.8
Transportation and
Communications
9,017 (5.2
Const. uction
6,786 1 9 0 0
Mining and [quarrying
4,663 12.7
Electricity, Gas
and Water
2;029 (1.2
Unemployed
36,644 (20.9
Not Adequately
Described
1,2 (0.7
*Includes forestry, hunt
N INNNI NIIINIII INNNl11IIINNI 38.227
fffrf( 5,695
M"111 NIII 9,176
t I f f f 5 y,1 126 i
NINNNI NI 12,544
ffflffffff ttrf( 14.703
"M
rrfnifl 7,660
NINNN 8,427
1 Sao
IIINl1 6,766
20 1 1,000 Males
!!!M 4,333 1,000 Females
1 330
11 1,959
70
IIINIIIII IIINNIII NII 22,361
r ffrffffrf fff+ 13,283
7 821
1 400
ng, and fishing.
FIGURE 13. Labor force by branch of the economy
and sex, 1965
143,700 people age 1.1 and over not in the labor force
in 1965, some 29,5W were in school and 12300 were
sick or disabled. Most of the remaining 101,900
persons were unskilled fenales and retired persons over
ate 60, only a few of .vliom would enter the labor
forc, even in it severe ;crisis.
Unemployment has remained high since 1963 in
spite of the steady growth of the economy.
Unemployed persons made up over 21 of the labor
force it. 196.3, and the 1970 census indicated that
about 20% of the labor force was unemployed in that
year. At the root of the persistent unemployment
problem has been the steady progress of mechaniza-
tion in agriculture. A contributory factor hay been the
growing dislike for agricultural pursue iry new labor
force entrants. Underemployment is also a serious
problem. In 1965 only about half of those employed
were fully employed, and about one -fifth of the labor
force had two occupations concurrently; part of this
group worked less than one -third of the year in their
primary occupations.
Labor productivity has been high in the bauxite and
sugar industries but low in most other economic
activities. Opportunities for labor to intwe from low
to high -yield sectors are limited. The sugar and rice
1 industries are highly seasonal and the
economy has been unable to readily absorb seasonally
unemployed workers into other a -�tivities.
Although the government prescrihcs minimum
wages for a few industries such as clothing, most wages
and salary earners are paid at rates stipulated in
collective agreements. Wages in the hauxite industry
(1.42 Guyana dollars ((.S) per hour for unskilled and
(;$2.20 for skilled labor) are about twice as high as
those in other industries. As labor has become
increasingly organized, the gap between wages in the
bauxite industry and those in other sectors has tended
to narrow.
D. Economic policy and development
1. Policy
From the early 1960's the government has played an
important role in the economy, channeling a large and
increasing share of gross domestic expenditure through
the government budget for public consumption and
investment. Government outlays in 1961 made up
19% of GDP and by 1969 had risen to 24,c (Figure
14). Since proclaiming Guyana a cooperative
republic' in early 1970, Burnham has sought to
expand the public sectors role even further, and by
1971 government outlays hod increased to Wr* of
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101.2
In eammnt:
Public 7.2 ercent
Percent of GDP
102 8 1033 101.7
99.2 97.9 98.0
6.3.
7.8 I
1961 1963 I%S 1%7 68 69 70
NOTE: Grass d*W9k expenditures are less than GDP during years
when there is a surplus in the external balance of goods, services,
and tramfers. Conversely GDE exceeds GDP when the external
boldnce is in deficit.
FIGURE 14. Gross domestic expenditure by end use
GDP. This polic% is k-ing implemented largei%
through the acquisition for the government of at least
tnajority ownership of major economic- enterprises and
through the expansion of the economic� role of
government- controlled cooperatives, which, according
to official ideology, are to become the dominant sector
of the ec�ononty.
The most dramatic step in carrying out Burihaids
nc�w police has hecn the 1971 nationalization of
DEM BA, Gtjyana's largest economic cntcrpnse.
Burnham has also talked of obtaining government
niajority ownership of the Reynolds b.,ttxite properties,
although no action has vet been taken. Prior to the
adoption of this new Policy, the extent of goyernnn�nt
ownership of econornic enterprises was small, tieing
limited mainly to it few rice mills, about half of
electric power generating capacity, telec�oninuntic�a-
tions facilities and the domestic airline. Subsequentl%.
however, the government has gained control of
numerous enterprises, including �in addition to
DEMBA �a trading eornpany. Gnyands largest
timber concern, several large state� farms. and a
1?
71
newspaper printing first. "I'he goyer tnenl also has
established a eonunerehil hank. which is ultimately to
replace. for the most part, the five foreign -owned
hanks. and has created the I ?xternal 'Trade Bureau.
which controls srnte 20 of iniports.
The goyernnieW seeks to expand the role of
cooperatives as a means of insuring popular
participation in the henefits of cconontic� deyelop-
ment. Cooperatives alwady had bec�onn� %%idespread.
In l,rt ether 1969. for example, there were 805
c�ooperatiye societies with it nwnthership of about
10.000 �a little more than half of which were credit
and savings c�ooperatiycs. By early 1972 the number of
c�ooperatiyes had risen to 1.100 with if nn�mbership of
90.000. Despite the large iwnibers, however. the
c�oopercttiyes' contribution to the economy remains
relatively small.
The Btirnitam government continues �on its ocyn
terns �to welc�oine private fon�;gn inyesttnent.
particularly in projects inyolying exploitation of
natural resources. \e%y undertakings inusl he imot
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ventures with the Ctivanese Government or with a
domestic cooperative, 'Itc foreign partners loving
restricted to a minorit% sh: re.
a. Public finance
The central government dominates the financial
operations of the public sector, which also includes 20
public
regional districts, five municip alities, and 19 p
g P' F
enterprises and decentralized institutions. The central
government collects 80% of total public revenues and
accounts for Wi of expenditures.
r' Central government revenues grew about 8`i
annually during 19613 -70. This giowth reflected
mainly increased income tax receipts resulting from
improved collection methods, higher tax rates, and a
growing revenue base. In 1970 about 7' of central
government revenue cam e
e from income taxs large
share by Latin American standards (Figure 15).
Government revenues also henefited from a
consumption tax levied at the end of 1969 which
collected 635.3 million in 1970. Revenues declined by
7% in 1971, however, because of reduced income tax
receipts following the nationalization of DEMBA.
DEMBA stopped making tax payments after the first
quarter of 1971, while its successor, GU BAH trade
only a token payment in the last quarter of the Near as
a result of reduced sales and the need to build working
capital reserves.
Government rece from inquort d uties have IN�� -n
adver,:�!y affected h% the alxditiott (of duties on
intlxrt, from CARIFTA countries in 1%8. The
resulting decline in tollec�tions was checked in 1%9 by
a 35i surcharge on all imixorts subject to duty, but
revenues from imixrt duties declined again in 1970
and 1971.
Central government exix�nditures grew almut
annually during 1967 -71. Current eoutlays accvttnte�d
for the !ulk of the rise, their share of total exix�nditures
increasing from 674 in 1%. to 70fi in 1971. This
growing share results from increased outlays Ixwth for
general administration and for the ttaintcuance (if
puhlic� facilities, esix�c�ially roads and sea defenses.
Reflecting increased eft rts to expand economic
infrastructure, central government capital outlays ,till
grew at an average annual rate of about S;i during
196ti -71. Of total capital expenditures of ahotit G$2:31
million during 19(i7 -71, 23 was six�ut on reads, 13`.f
on sea and river defenses, Wi on agriculture, and 9i
on civil aviation.
The rapid increase in expew itttres during 1%. 7 -70
lmosted budget deficits from Wi to 20 '/i of total
expenditures. With the decline of current revenues in
1971, the deficit rose to 31 I i. During 1967 -70, alxut
half of the deficit was financed with long -term
external borrowing. In 1971 the availability of funds
from external sources fell short of the need, a:A the
FIGURE 15. Revenues and expenditures of the central government
(Millions of Guyana dollars)
13
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1967
1968
1969
1970
1971
1972*
Revenues:
Income taxes
28.5
35.3
34.3
50.1
42.9
63.3
Property and inheritance taxes....
0.9
1.0
1.4
2.6
2.9
3.2
Import taxes
35.4
36.3
41.3
40.3
38.5
36.:3
Export taxes
1.8
2.3
2.6
2.7
2.7
2.9
Consumption and transaction taxes.
13.8
14.9
17.4
23.6
24.7
26.1
Capital receipts
14.2
7.6
6.3
2.7
1.1
2.3
Other uontax receipts............
12.4
12.8
13.6
13.6
13.5
16.5
Total
107.0
110.2
116.9
135.6
12!).:3
150.6
Expenditures:
Current
81.6
90.9
99.5
118.9
128.6
137.2
Wages-salaries
38.0
39.8
44.7
49.3
57.0
65.2
Purchases of goods and services..
20.0
24.1
29.4
37.1
33.9
35.8
Subsidies and transfers.........
13.3
15.3
14.9
17.6
20.0
17.9
Interest on public debt.........
9.0
10.5
9.0
11.2
13.2
13.7
Other
1.3
1.2
1.5
3.7
4.5
4.6
Capital
40.1
39.7
44.9
51.0
55.0
79.4
Total
121.7
130.6
144.4
169.9
183.6
216.6
Deficit
14.7
-20.4
-27.5
-34.3
-57.3
-66.0
*Plan.
13
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share trf the deficit fina domewticaliv mainly In
the banking system rouse to more than 60
b. Banking, money supply, and prices
The banking system consists of the Bank of Guyana
(the central bank), six commercial hanks (composed of
five subsidiaries of foreign hanks and the government-
owned National Cooperative Bank). and a Post Office
Savings Bank. Supplementing the banking system are
two trust companies, an investment company, a few
insurance companies. and a large number of small
credit unions and cooperative savings and credit
societies. Since 1967 the Bank (if Guyana has operated
a "call stock exchange" which aims at improving the
market for shares of local firms. Transactions on the
exchange are small and limited -to the shares and
debentures of a few leading companies.
The Bank of Guyana is legally endowed with the
customary tools of monetary m anagement, having the
power to control reserve requirements and liquidity
ratios for commercial banks, to rediscount commer-
cial, industrial, and agricultural paper, and to regulate
commercial interest and loan rates. The central hank
also is authorized to specify the purpose, minimum
security, and maximum maturities for loans by
commercial banks, as well as to set limits for various
loan categories and the total amount of loans
outstanding. The central bank has relied to a large
extent on such direct credit controls in regulating the
money supply.
The most important commercial hanks are
subsidiaries of the British -owned Barclays Bank and
the Royal Bank of Canada. These banks hav: several
local branches and offices in the more populated
areas. The ee -,c nment- owned National C ooperative
Bank was formed to reduce the influence of the foreign
banks. The Post Office Savings Bank, founded in
1889, is one of the oldest financial institutions in
Guyana. With over 60 branches throughout the
country, it has been very successful in mobilizing the
savings of small savers, especially in rural areas.
Reflecting a relatively conservative credit policy,
domestic credit expanded by about I Wr annually
during 1967 -71. Although credit cowinued to go
mainly to the private sector, rising def;�;.ts boosted the
government's share of total credit from 27 to 34%
during the period. The money supply expanded
during 1967 -71 by only 7% annually -a rate
commensurate with GNP growth. The relatively slow
money supply growth resulted mainly from it decline
in the banking system's holdings of foreign assets and
the private sector's increasing willingness to hold
quasi -money (time and saving deposits), which rose
14
II annually during this period. 'These latter
developments effectively neutralized the potential
inflationary effects of bank financing, of part of the
government deficits.
According to the governments outdated consumer
price index. official retail prices rose only about 2.5i
annually during IW7 -71, although the actual increase
may have been somewhat higher. The� government
maintains price controls on locally produced and
imported essential consumer items as well as industrial
products that receive tariff protection while price
determination for domestic foodstuffs, except rice, is
generally left to market forces so as to encourage
production. "They government plans to extend the list of
goods subject to price controls as additional
commodities are added to the list of products imported
by the state trading agency.
2. Development
Since President Bumham's proclatuation of Guyana
as a "cooperative wpublic," the government has been
working out a new development strategy in which the
public and cooperative sectors are to play leading
roles. The development plan for 1966 -72 (Figure 16)
was dropped before completion, and the government
began preparation of it 15 year plan for 1972 86 aud,
within its framework, an operational 5 year plan for
1972 -76. Although the new plan has not been
finalized, sonic of its basic objectives have been taken
into consideration in the 1972 budget and in other
ecouontic policies, including the December 1971 ban
on an exte nsive list of food and other imports
FIGURE 16. The 1966 -72 public investment plan
(Millions of Guyana dollars)
Not pertinent.
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PLAN
1966 72
ACTUAL
F.XPENPI-
1969
TUat:S
Original
Revision
1966 71
Agriculture, forestry. and
fishing
64.7
60.0
30.S
Transportation and public
works
64.7
95.0
118.0
Seawall defenses.........
14.7
40.0
32.7
C'ommunications........
S.3
14.0
17.6
Electric power..........
14.7
30.0
14.2
Industrial development...
17.7
17.7
5.5
Education
11.8
32.0
19.7
All other social services...
85.3
80.0
20.4
Public credit to various
sectors
11.8
11.8
4.2
Unallocated
20.2
Total
294.2
383.5
283.3
Not pertinent.
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Pk
Y;
The immediate objectives of the new 5 -year plan
will he to achieve self sufficiency in foodshiffs anci
textiles by 1976 and to make accelerated progress
toward meeting housing needs. The attainment of the
self sufficiency goal, ho% ever, would require increases
in the production of fish and beef of about one- thirc',
and one- fourth, respectively, and it huge increase in
the acreage under minor crops. In vices of ill(-
magnitude of the task, there is little likelihood that the
government can achieve this goal.
I,. International economic relations
1. Foreign trade
The economy is heavily dependent upon foreign
trade. During 1961 -67, for example, exports and
imports equaled 5051 and 47f; of GDP, respectively.
Except for slight dips in 1964 and 1965, the value of
export:: has risen steadily over the last decade Figure
17). The increase is attributable mainly to expanding
sales of bauxite and alumina and rising prices for sugar
and rice.
Imports, on the other hand, have been erratic,
fluctuating with variations in domestic economic
activity. For example, imports in 1962 -63 averaged
about 17% below the 1961 level because of the sharp
curtailment of investment activity in the face of
political and social unrest. During 1964-67 imports
rose 16% annually, as large bauxite expansion
programs hoosted imports of capital goods. Following
a decline in 1968 when these projects were completed,
imports rebounded in 1969 and 1970 under the
impetus of new bauxite investments and expanded
government development programs. Despite increased
purchases of food and intermediate goods, total
imports declined in 1971 with the slowdown of bauxite
investment.
a. Trade patterns
Sugar, rice, bauxite, and alumina account for the
bulk of export earnings. Less important items include
shrimp, rum, molasses, diamonds, and timber. Dried
and calcined bauxite has surpassed sugar as Guyana's
most important export item.
Imports consist primarily of intermediate and
capital goods, although foodstuffs are also important.
In 1971 intermediate goods accounted for about -18%
of total imports; machinery and transport equipment,
23 food, 16%; and other consumer goods, I I S;
Imports of intermediate goods, which consist mainly
of industrial materials, chemicals, and fuels, have
grown steadily in response to expanding domestic
FIGURE 17. Balance of trade
economic activity. On the other hand, capital goods
imports have registered wide year -to -year fluctuations
in keeping with changes in investment. The value of
imported foodstuffs, of which wheat. milk products.
and processed meat are the most important. has
remained fairly constant over the period.
The geographic pattern of Guyana's trade has
changed considerably since the 1930 s with the
emergence of bauxite and alumina as major export
items. The United States, Canada, and the
continental countries of Western Europe have become
increasingly important markets for Guyanese minerals
while simultaneously becoming major sources of
machinery and equipment for the hauxite industry
and of Alter imports. On the other hand, the United
Kingdom, which formerly dominated Guyana's
foreign trade, now has a trade share only equal to that
of the United States: in 1970 each accountec: for about
one- fourth of Guyana's total trade (Figure I8).
to
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Portent
FIGURE 18. Direction of trade
Percent
Continental Western Europe and Canada, major
markets for alumina and, in the latter case, bauxite,
are tied for third place, closely followed b,' niembers of
the Caribbean Free "Trade Association (CARIPTA). In
addition to Guyana. the association consists of
lntigim. Barbados. British 1 ionduras, Mininic�a,
enadu, Jamaica, Montserrat, St. Kitts- Nevis-
Anguilla. St. Lucia, St. Vincent. and '1 rinidad uncl
Tobago. The association, original:, funned to promote
regional trade through it reduction of trading harriers
o, products of area origin� is scheduled to he expanded
into it modified common market in 1973, with a
common external tariff and harnionization of fiscal
incentives to industry.
Guvana's trade with Communist countries has been
negligible. Inworts from these countries mainly the�
U.S.S.R. �have been averaging less that) USS750,000
annually while Guyanese exports appear to have been
virtually nil until 1972, when 100,000 to 1 50,0(x)
metric tons of alumina, worth about $ri million, were
sold to the U.S.S.R. Guyana has made it concerted
effort to expand trade ties with the Communist world.
In late 1971 the Burnham government signed a
bilateral trade agreement with the Peoples Republic
of China providing for a potential trade turnover of as
much ar: $1.3 million auutually.
IG
b. Trade regulations
Guyana's former relatively liberal trade controls
have been tightened considenbl% under BurthanCs
administration. Althttigli import licenses are granted
freely for many items front most countries, the� list of
goOcis prohibited for protective reasons was lengthened
at the end of 1971 to include a wide range of food aril
nonfood items. In adldlitiun, in mid -1970 the
jurisdiction of the I-.xternal Trade Bureau
which had been created in 1970 to control imports
front Communist countries. %%as subsequentI\
expanded to include imports of c'hemic'als and
pharnaceuticais, cement, and ,lost foodstetffs front all
sources.
Import duties are intended both for revenue and
protection. "Three duty schedules are in effect: at
schedule for imports of CARIFTA origin, it
preferential schedule for imports from other
Commonwealth countries, and it general schedule for
ncrt- Conurtonweaith cotntries. As of I May 1968 all
duties were eliminated oil imports of CARII "I'A origin
except for it reserve list Of co mmodities for which
removal is to be gradual. General schedule tariff rates
range from SSi to 93VI" ad calowin, with an average of
about -1011. while preferential rates range from 2 to
20 percentage points lower. Some itents. inc�loding
ntael inery and equipnu�nt, enter elute free under the
provisions of investment incentive Iegisiatiou.
An ad valorem export tux of I.5`; is applied to must
nonnianufactured products. Major exc�epticrts are
bauxite. raw sugar. lirinip. and it few minor items
subjc ct to specific duties. tiIlbougl export, :re
supervised to insure repatriation of exchange proceeds.
export licenses are not required for most products.
Trade with Rhodesia. South Africa. and Portugal is
prohibited.
C:uv,ua maintains a unified exc�bange rate system.
with all foreign exchange transactions carried out at
the official rate. Guyana remains it meinber of the
sterling area: parit} \010 the t'.S. dollar was
maintained following the 1971 international c�,rrency
realignment. ibis devaluing the Guyana dollar in
terms of sterling, but the Guyana dollar began floating
with the pound in June 1972. Export and import
transactions are free front restrictions, but sale of
foreign exchange for travel and for capital pay'llents
and transfers is restricted and, in sums� c�ircurnstautc�es,
prohibited. As i t Corruuonweallh country. Guiana
formerly exempted capital transactions with other
Conunonwealth countries from restrictions. but in
Dec'e'mber 1971 this exemption was terminated.
2. Balance of payments
After several years of foreign payments surpluses.
Guyana incurred moderate deficits during 1967 -70
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"Caribbean =ree Trade Association

FIGURE 19. Balance of payments
(Millions of U.S. dollars)
Not pertinent.
(Figure 19). Although trade surpluses were achieved in
2 of the 4 gars, substantial outflows of repatriated
profits from foreign- ov. sugar and bauxite
companies kept the current account consistently in the
red. Except in 190 when the payments deficit was
caused by foreign reserve revaluation resulting from
devaluation of the pound sterling, capital inflows were
insufficient to compensate for the current account
deficit. In 1971 it balance of payments surplus resulted
from it unique combination of favorable circum-
stances: a substantial trade surplus induced partl% by
the drop in imports, repatriation to Guyana of the
US$4.8 million DEMBA pension fund formerly held
in Canada, and increased government and private
borrowing abroad. Government acquisition of the
DEMBA hauxite properties is reflected in the 1971
foreign payments account by bookkeeping entries that
had no net effect on the balance. Reflecting the
developments since 1966, foreign reserves dropped
from $36.7 million at the end of 1966 to $26.3 million
at the end of 1970. Although the 1971 payments
surplus boosted reserves to $31.3 million, they remain
small. equaling less than 3 months' imports.
3. Foreign assistance and debt
In per capita terms, Guyana has received a
substantial amount of economic assistance since 1960.
Assistance amounted to US$69 million from the
'?nited Kingdom during 1960 -70 and to sine USS1 7
million front Canada during 1960 -71. U.S. aid
authorizations during 1965 -72 totaled $55 million in
loans and some $19 million in grants. Prior to 1965.
U.S. assistance was limited to it total of about $5
million in small grants. Guyana receives no U.S.
military aid. Economic assistance from international
financial organizations amounted to $27 million
during 1946 -7I. Aid front Communist countries was
nil until April 1972, when the People's Republic of
China extended it $26 million interest -free develop-
ment loan. Drawings against the loan are to he made
over it 5 -year period beginning in 1972, with
repayment to be spread over 20 follo%%ing a 10-
year grace period.
Guyana's external public debt, after remaining
almost unchanged throughout the mid- 1960's, has
more than doubled since 1969. 'Total indebtedness rose
from US$59 million in 1968 to $139, million in 1971.
largely as a result of addition of the $53.5 million debt
incurred as compensation for nationalization of the
DEMBA bauxite properties. The highly concessionary
terms under which Guvatia has obtained foreign
assistance have contributed to a light debt service
burden. Service payments totaled only $4.4 million in
1971, or about 3 1 of export earnings. Even including
compensation payments, which Began in 1972, debt
service payments are expected to amount to only 5 I li
of export earnings -well helow the Latin Arnerican
average.
lid
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1967
1968
1969
1970
1971
Balance on current account:
Exports (f.o.b.)
121.8
113.0
123.8
129.0
137.1
Imports (c.i.f.)
126.0
-106.4
--117.2
-133.1
130.7
Investment income
-18.3
-15.1
-18.0
14.8
14.0
Travel and other services
-4.5
-4.7
1 .3
-0.5
-o.7
Private transfers
-1.5
1 .4
-0.9
-0.5
3.7
Total
-28-5
-14.6
13.6
-19.9
-4.6
Balance on capital account:
Official transfers
4.0
2.2
1.3
0.3
1 .0
Private capital:
Direct investment
18.4
7.9
8.7
6.1
-57.5
Other
1.8
-3.0
-5.0
0.0
4.6
Official loans
4.8
4.4
8.6
10.1
68.3
Special drawing rights allocations........
2.5
2.1
Total
29.0
11.5
13.6
19.0
16.5
Errors and omissions
4.3
-0.7
4.7
-0.7
-6.7
Foreign reserve revaluation
-5.1
Balance of payments surplus or deficit
-0.3
-3.8
--4.7
1 .6
5.2
Net change in reserves (increase
0.3
3.8
4.7
1 .6
5.2
Not pertinent.
(Figure 19). Although trade surpluses were achieved in
2 of the 4 gars, substantial outflows of repatriated
profits from foreign- ov. sugar and bauxite
companies kept the current account consistently in the
red. Except in 190 when the payments deficit was
caused by foreign reserve revaluation resulting from
devaluation of the pound sterling, capital inflows were
insufficient to compensate for the current account
deficit. In 1971 it balance of payments surplus resulted
from it unique combination of favorable circum-
stances: a substantial trade surplus induced partl% by
the drop in imports, repatriation to Guyana of the
US$4.8 million DEMBA pension fund formerly held
in Canada, and increased government and private
borrowing abroad. Government acquisition of the
DEMBA hauxite properties is reflected in the 1971
foreign payments account by bookkeeping entries that
had no net effect on the balance. Reflecting the
developments since 1966, foreign reserves dropped
from $36.7 million at the end of 1966 to $26.3 million
at the end of 1970. Although the 1971 payments
surplus boosted reserves to $31.3 million, they remain
small. equaling less than 3 months' imports.
3. Foreign assistance and debt
In per capita terms, Guyana has received a
substantial amount of economic assistance since 1960.
Assistance amounted to US$69 million from the
'?nited Kingdom during 1960 -70 and to sine USS1 7
million front Canada during 1960 -71. U.S. aid
authorizations during 1965 -72 totaled $55 million in
loans and some $19 million in grants. Prior to 1965.
U.S. assistance was limited to it total of about $5
million in small grants. Guyana receives no U.S.
military aid. Economic assistance from international
financial organizations amounted to $27 million
during 1946 -7I. Aid front Communist countries was
nil until April 1972, when the People's Republic of
China extended it $26 million interest -free develop-
ment loan. Drawings against the loan are to he made
over it 5 -year period beginning in 1972, with
repayment to be spread over 20 follo%%ing a 10-
year grace period.
Guyana's external public debt, after remaining
almost unchanged throughout the mid- 1960's, has
more than doubled since 1969. 'Total indebtedness rose
from US$59 million in 1968 to $139, million in 1971.
largely as a result of addition of the $53.5 million debt
incurred as compensation for nationalization of the
DEMBA bauxite properties. The highly concessionary
terms under which Guvatia has obtained foreign
assistance have contributed to a light debt service
burden. Service payments totaled only $4.4 million in
1971, or about 3 1 of export earnings. Even including
compensation payments, which Began in 1972, debt
service payments are expected to amount to only 5 I li
of export earnings -well helow the Latin Arnerican
average.
lid
APPROVED FOR RELEASE: 2009/06/16: CIA- RDP01- 00707R000200070005 -3

Places and features referred to in this chapter
R
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2009/06/16: CIA- RDP01- 00707R000200070005 -3
COORDINATrS
o N.
P 11'.
Berbice River (stream)
6 17
57 32
Courantyne River (stream)
5 57
57 06
Demerara River (stream)
6 48
58 10
Everton
6 12
57 31
Georgetown
6 48
58 10
Kwakwani
5 07
58 03
Linden
6 00
58 IS
Matthews Ridge
7 30
60 10
New Amsterdam
6 15
57 31
Pakaraima Mountains (mountains)
4 05
61 30
Pomeroon River (stream)
7 37
58 44
Potaro River (stream)
22
58 52
Tunlatumari
5 20
541 00
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2009/06/16: CIA- RDP01- 00707R000200070005 -3