THE DEBT PROBLEM IS A BOGEY
Guyana does not have a foreign debt problem. Though the external debt is close to US$1.2 billion, Guyana’s ability to service this debt is what matters.
The size of the debt does not always tell the right story. A man can owe the bank tens of millions, but once he continues to adequately service that debt without his business contracting, then the debt itself does not pose an onerous burden.
It is very much like a man who owes the bank a lot of money. If the increase in the man’s debt was due mainly to interest payments being capitalised, then it can be said that the servicing of the debt represents a problem.
Guyana’s debt servicing is within manageable limits. In fact, Guyana’s debt situation has never been as manageable as it is today. There are many who would like to believe that the PPP is about to make the same mistakes that the PNC made by chalking up a huge debt. These persons are mistaken and are raising an old bogey.
The problem with the PNC was not how much they borrowed, but how incompetently they ran the economy. They mismanaged the economy to the point where they couldn’t satisfy debt servicing.
Guyanese do not need any Hansard to educate them about the hard times. There are still thousands who lived through that period when our citizens were humiliated and demoralised because of the harsh economic situation.
One of the main contributors to the pressures that faced the Guyanese people at the time was the growing foreign debt. Interest payments accumulated upon interest payments, which when capitalised, placed Guyana in the unenviable position of being one of the most highly indebted countries in the world.
The debt that accrued under the PNC sucked the life out of this country and was a major economic bottleneck for years.
One of the most remarkable economic turnarounds ever was, however, achieved under the PPP, when it was able to reduce the debt and still find the resources to change Guyana’s economic fortunes.
This fairytale recovery is attributable to one person and one person alone: former president Bharrat Jagdeo. Under him, Guyana moved from being one of the most highly indebted countries in the world on a per capita basis to a position of debt sustainability. For this feat alone, this country will forever be indebted to the former president. He saved this country from drowning in debt.
It is true that lifebuoys were thrown by the developed world in the form of debt forgiveness, but the remarkable thing was that Guyana’s economy did not falter during the greater part of this restructuring contract.
Guyana can today pay its debt because of Bharrat Jagdeo. Guyana is now the top economy in the Caribbean, and that too, is because of Bharrat Jagdeo. Those who are today raising the bogey of debt non-sustainability are raising a red herring. They are doing so because they can find very little else to condemn the government on.
There have been problems under his rule of course, and these relate to some major controversial contracts, but every man deserves his due, and Bharrat Jagdeo deserves his for the work he did in making Guyana’s economy the strongest it has ever been.
Guyana is not going to go back to the days when people could only afford two meals a day. Guyana is not going to go back to the days of long lines for basic food items and for petrol. Guyana is not going to go back to the days when you were given a mere US$40 to travel with when going abroad. Guyana is not going to go back to the days when six-hour blackouts were an almost daily feature. Guyana may have its problems, but it has come a far way. It is not going back downhill.