Vice President Bharrat Jagdeo is once again assuring citizens that the country’s oil and gas resources are in safe hands with the government.
Speaking during a business dinner hosted by the Guyana Manufacturing and Services Association last night, Mr. Jagdeo said the government has noted calls on how the oil resources should be spent, but he believes that many of those calls are misplaced and can create inflation and other harm to the country.
He said the Government’s focus is not to spend blindly and wildly but rather on projects that will better the lives of every citizen. He identified areas such as Education, Health, and Infrastructure as some of the priority areas.
“It’s important, every one of these things is important, we can’t not do them. We can’t not build better schools, hospitals, roads, bridges, power plants etc., that’s a necessary expenditure, but it could become inflationary too,” Jagdeo explained.
Guyana started oil production just over a year ago.
According to the Vice President, while the government must save from the oil revenues, it is important for the country to understand the massive work that must be undertaken to bring Guyana up to par with the rest of the world. In this regard, he said the government has up its development ante.
“So the government is ramping up its expenditure on the capital side: seven new hospitals will start this year, almost half a billion US dollars to be spent on the Soesdyke corridor, all the way into Mabura Hill— $200M or Linden to Mabura Hill road, $120M from Soesdyke to Linden junction and then may $50-60M on the bridge to cross, that’s only from the Soesdyke junction to Mabura Hill, half a billion US dollars of spending,” Jagdeo said.
With both the private sector and government ramping up investments, Jagdeo explained that there will be combined aggregate demands which will outstrip the country’s productive capacity, an issue he said must be monitored closely to avoid inflation.
He said future growth is another priority area for the government.
“We are not going to fall in that trap where you splurge on the current side of the budget and then you avoid on the capital side which creates the basis for future growth. And so that is something you will see also as another pattern of the People’s Progressive Party, working to improve people’s lives today but with a long-term focus on planning for the future. Future growth is part of the development equation every single day”.
Some analysts have expressed concern with some of the government’s heavy spending on infrastructure while many citizens are finding it difficult to deal with the rising cost of living.