Trade and Poverty Reduction Nexus in Guyana

Prepared a position paper on the Trade and Poverty Reduction Nexus in Guyana for the Inter-American Development Bank in Washington.

Our duties involved:

  1. Collecting available time-series data on socio-economic indicators for Guyana as needed by the analysis, including macroeconomic indicators (gross domestic product (GDP), domestic production by economic sectors, GDP per capita, consumer prices), trade openness (exporters plus importers of goods and services to GDP, exports and imports of the top five products), tariff liberalization (average tariffs and national applied tariffs by sectors and for the top five products), labor market conditions (employment, wage and skill levels by sector), and poverty (income distribution, gini coefficients, poverty head count by geographical and administrative region),
  2. Summarizing the nature and scope of Guyana’s past trade and integration efforts, in terms of how much and what has been liberalized and at what times, and map expected liberalization over the next ten years (effects of European Union (EU) sugar policies, further liberalization under the Caribbean Single Market and Economy (CSME), Economic Partnership Agreement (EPA) implementation, possible further liberalization under the World Trade Organization (WTO) and with other countries – USA, Canada and Latin America),
  3. Conduct a brief overview of existing research on the impact of trade liberalization on economic growth, income distribution, and poverty levels, and
  4. Addressing the following questions:

    • What were the main components of the Economic Recovery Programme (ERP) launched in 1989 to open the Guyanese economy to trade and investment?What, if any, has been the impact of the ERP on domestic manufacturing activity in non-traditional sectors such as furniture, soap, cement, and appliances?
    • What, if any, had been the impact of the implementation of the CARICOM Common External Tariff (CET) (1994 – 1998) on domestic production and employment? Have Guyana’s traditional sectors (rice, sugar and bauxite) been subject to increased protection and competition?
    • Is there evidence that Trinidadian or other Caribbean manufacturers have displaced Guyanese manufacturers in domestic and regional markets? Do Guyanese agricultural exporters face discriminatory barriers in CARICOM? If so, has it affected employment and wages? Are non-traditional agricultural products been subject to competition from CARICOM producers?
    • Does Guyana’s Poverty Reduction Strategy Paper (PRSP) focus on preparing for and mitigating the impact of trade liberalization? Has there been progress in implementing the PRSP?
    • How effective the Government have been in diversifying the economy away from primary products and into non-traditional products and services?
    • As a net importer and consumer of fuels, what impact have rising oil prices had on the Guyanese economy, its balance of payments account, and the cost of living?
    • In what Geographic regions do the pockets of poverty exist, and what economic activities take place? Can this poverty be linked to isolation or trade liberalization?
    • What are the implications of Guyana’s “National Action Plan on Accompanying Measures for Sugar Protocol Countries Affected by the Reform of the EU Sugar Regime” on the sugar industry’s employment structure and rural development?
    • What social safety net programmes are managed by the Ministry of Labour, Human Services and Social Security? How effective are these programmes in targeting sectors, firms and individuals affected by Guyana’s transition to freer trade?

Duration: September – December, 2006