Govt’s intent to borrow $220B to manage economy “shocking”- Jagdeo

… says large scale borrowing under PNC Govt led to a bankrupt country

Opposition Leader Dr Bharrat Jagdeo, who is an economist by profession, has dubbed the revelation that the incumbent APNU/AFC Administration has singled its intention to collectively borrow approximately 220 billion Guyana dollars (GuySuCo’s $30B bond and the Islamic Development Bank loan of $US 900M) as ‘shocking and cause for worry.’

According to the Opposition Leader, “this failed approach to national economic management was tried in the past. It led to a bankrupt country and resulted  in devastating consequences for our people.   I am sure everyone would recall that the external debt was over 900 per cent of GDP in 1992, which was reduced to 36 per cent of GDP in 2015.”

Jagdeo, in a released statement, said that his party, the PPP, had predicated that this Government would go this route since “the massive growth in the size of the national budgets, primarily on consumption, could not be financed  by the hefty increase in taxation; so this hopelessly misguided APNU government had to resort to large scale borrowing.”

The shocking revelation within the past week that the government  intends to borrow close to G$ 220B (GuySuCo’s  bond and Islamic Bank loan), almost the equivalent of Guyana’s total external debt by 2015  of G$236B, is serious cause for concern.

We had however predicted this. The massive growth in the size of the national budgets, primarily on consumption, could not be financed  by the hefty increase in taxation; so this hopelessly misguided APNU government had to resort to large scale borrowing.

This failed approach to national economic management was tried in the past. It led to a bankrupt country and resulted  in devastating consequences for our people.   I am sure everyone would recall that the external debt was over 900 per cent of GDP in 1992, which was reduced to 36 per cent of GDP in 2015. They plan to double it again within five years.

Borrowing without feasibility studies and spending haphazardly with no vision or plan, particularly in the wasteful and corrupt manner that is now the hallmark of the Granger-led Administration will not solve the economic malaise that we face, but lead to pawning the wellbeing of current and future generations of Guyanese.

I will address this matter extensively at my next press conference.