Oil production drives up GDP to 49.7% in first half of 2024 – Mid-Year Report

Sep 01, 2024 News

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…as sugar industry declines by 60%, gold down by 10.3%

Kaieteur News – Oil production in the Stabroek Block is driving Guyana’s Gross Domestic Product (GDP), resulting in a 49.7% growth in the first six months of 2024.

This was revealed in the Mid-Year Report, recently published by the Government of Guyana (GoG). The document also highlights a 12.6% growth in the country’s non-oil GDP between January and June this year, despite challenges in a number of traditional sectors.

The report noted that the overall outlook for 2024 remains positive, as strong performance in other sectors maintain non-oil growth expectations.

“Overall real GDP growth for 2024 is now projected at 42.3 percent, with non-oil growth of 11.8 percent. Once realised, this will represent the fourth successive year of expansion in the non-oil economy, following the contraction in 2020,” government said in the Mid-Year report.

Sugar down by 60%

Despite the $9B allocation to the Guyana Sugar Corporation (GuySuCo) in this year’s Budget and subsequent supplementary funding, the sector suffered a massive 60% decline in the first half of 2024.

GuySuCo reported 6,739 tonnes of sugar produced during the review period. “This performance is attributed to the carried over impacts of drier-than-usual weather conditions last year into the second quarter of this year,” the report explained.

Meanwhile, government revised its sugar production for the year from 100,000 tonnes to 70,000 tonnes.

Gold

Also recording a decline was the gold mining subsector which contracted by 10.3% compared with the same period last year. “At the end of June 2024, gold declarations stood at 188,160 ounces, with the 35.3% increase in declarations from the lone large producer outweighed by lower declarations from the small- and medium-scale producers. Declarations from the latter fell from 159,084 ounces in the first half last year, to 119,603 ounces at the end of June this year,” according to the report. Government predicts that subsector will grow by 2.1% this year.

Bauxite

During the period under review, the bauxite subsector contracted by 20%, recording a production of 196,650. The performance, according to the government, was driven by lower output from both producers, who continue to grapple with marketing and operational challenges.

It is however expected that the larger producer would improve production in the second half of the year. Additionally, the smaller operator anticipates that production will return to more stable rates, as plant reliability and other operational issues have been addressed. Overall production for 2024 is now projected at just over 1,620,000 tonnes, and the sector is now projected to grow at 41.3 percent this year.

Livestock

On the agricultural front, the livestock sector declined in the first half of 2024 by 7.8%. This was driven by contractions in the output of poultry meat and milk. According to the report, “The declines of 9.5 percent and 4.9 percent in poultry meat and milk, respectively, outweighed the increased production observed for beef, pork, mutton and eggs, which grew by 21.1 percent, 23.4 percent, 68.2 percent and 3.5 percent, respectively.”

Again, government noted challenges posed by hot temperatures. This resulted in ‘Inclusion Body Hepatitis’ in poultry while extreme dry conditions affected forage availability and promoted the multiplication of insect pests which affected the production of milk.

Rice

During the period, the rice industry is estimated to have grown by 17.9%. The Guyana Rice Development Board (GRDB) reported production of 362,030 tonnes of rice equivalent, compared with 302,295 tonnes in the first half of 2023.

While bad weather was blamed for the poor performance in the sugar sector, the report cited “favourable weather conditions” for the growth in production.

Meanwhile, “given the better-than anticipated performance in the first crop,” the production estimate for the year has been revised upward to 717,032 tonnes of rice. The sector is now projected to grow by 8.9 percent this year.

Forestry

With 202,066 cubic metres of timber products produced as of June 2024, government estimated a 13.2% expansion of the forestry sector in the first half of the year. The sector’s growth outlook for the year is unchanged at 3.9 percent.

Fishing

Interventions made in the fisheries sector resulted in a 27.7% growth during the first half of the year, with increases recorded for both shrimp and fish production.

The report states that fish output grew by 39.1%, reaching 9,821 tonnes at the end of June this year. Meanwhile, marine shrimp production reportedly grew by 1.9% to reach 9,588 tonnes at the end of the first half of this year.

“Also supporting growth in this subsector is the 70.6% increase in aquaculture production in the first half of the year. The overall performance is attributed largely to more favourable climatic conditions and increased fleet activity,” the report said. In the meantime, the subsector is now estimated to grow by 16.8% for the year.

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• GDP, Mid-Year, oil, production, Report

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