Guyana

Guyana's population is made up of five main ethnic groups--East Indian, African, Amerindian, Chinese, and Portuguese. Ninety percent of the inhabitants live on the narrow coastal plain, where population density is more than 115 persons per square kilometer (380 per sq. mi.). The population density for Guyana as a whole is low--less than four persons per square kilometer. Although the government has provided free education from nursery school to the university level since 1975, it has not allocated sufficient funds to maintain the standards of what had been considered the best educational system in the region. Many school buildings are in poor condition, there is a shortage of text and exercise books, the number of teachers has declined, and fees are being charged at the university level for some courses of study for the first time.

Before the arrival of Europeans, the region was inhabited by both Carib and Arawak tribes, who named it Guiana, which means land of many waters. The Dutch settled in Guyana in the late 16th century, but their control ended when the British became the de facto rulers in 1796. In 1815, the colonies of Essequibo, Demerara, and Berbice were officially ceded to Great Britain at the Congress of Vienna and, in 1831, were consolidated as British Guiana. Following the abolition of slavery in 1834, thousands of indentured laborers were brought to Guyana to replace the slaves on the sugarcane plantations, primarily from India but also from Portugal and China. The British stopped the practice in 1917. Many of the Afro-Guyanese former slaves moved to the towns and became the majority urban population, whereas the Indo-Guyanese remained predominantly rural. A scheme in 1862 to bring black workers from the United States was unsuccessful. The small Amerindian population lives in the country's interior.

The people drawn from these diverse origins have coexisted peacefully for the most part. Slave revolts, such as the one in 1763 led by Guyana's national hero, Cuffy, demonstrated the desire for

basic rights but also a willingness to compromise. Politically inspired racial disturbances between Indo-Guyanese and Afro-Guyanese erupted in 1962-64. However, the basically conservative and cooperative nature of Guyanese society contributed to a cooling of racial tensions.

Guyanese politics, nevertheless, occasionally has been turbulent. The first modern political party in Guyana was the People's Progressive Party (PPP), established on January 1, 1950, with Forbes Burnham, a British-educated Afro-Guyanese, as chairman; Dr. Cheddi Jagan, a U.S.-educated Indo-Guyanese, as second vice chairman; and his American-born wife, Janet Jagan, as secretary general. The PPP won 18 out of 24 seats in the first popular elections permitted by the colonial government in 1953, and Dr. Jagan became leader of the house and minister of agriculture in the colonial government. Five months later, on October 9, 1953, the British suspended the constitution and landed troops because, they said, the Jagans and the PPP were planning to make Guyana a communist state. These events led to a split in the PPP, in which Burnham broke away and founded what eventually became the People's National Congress (PNC).

Elections were permitted again in 1957 and 1961, and Cheddi Jagan's PPP ticket won on both occasions, with 48% of the vote in 1957 and 43% in 1961. Cheddi Jagan became the first premier of British Guiana, a position he held for 7 years. At a constitutional conference in London in 1963, the U.K. Government agreed to grant independence to the colony but only after another election in which proportional representation would be introduced for the first time. It was widely believed that this system would reduce the number of seats won by the PPP and prevent it from obtaining a clear majority in Parliament. The December 1964 elections gave the PPP 46%, the PNC 41%, and the United Force (TUF), a conservative party, 12%. TUF threw its votes in the legislature to Forbes Burnham, who became prime minister.

Guyana achieved independence in May 1966, and became a republic on February 23, 1970--the anniversary of the Cuffy slave rebellion. From December 1964 until his death in August 1985, Forbes Burnham ruled Guyana in an increasingly autocratic manner, first as prime minister and later, after the adoption of a new constitution in 1980, as executive president. During that time- frame, elections were viewed in Guyana and abroad as fraudulent. Human rights and civil liberties were suppressed, and two major political assassinations occurred: the Jesuit Priest and journalist Bernard Darke in July 1979, and the distinguished historian and WPA Party leader Walter Rodney in June 1980. Agents of President Burnham are widely believed to have been responsible for both deaths.

Following Burnham's own death in 1985, Prime Minister Hugh Desmond Hoyte acceded to the presidency and was formally elected in the December 1985 national elections. Hoyte gradually reversed Burnham's policies, moving from state socialism and one-party control to a market economy and unrestricted freedom of the press and assembly. On October 5, 1992, a new National Assembly and regional councils were elected in the first Guyanese election since 1964 to be internationally recognized as free and fair. Cheddi Jagan was elected and sworn in as president on October 9, 1992.

When President Jagan died in March 1997, Prime Minister Samuel Hinds replaced him in accordance with constitutional provisions. President Jagan's widow, Janet Jagan, was elected president in December 1997. She resigned in August 1999 due to ill health and was succeeded by Finance Minister Bharrat Jagdeo, who had been named prime minister a day earlier. National elections were held on March 19,  2001. Incumbent President Jagdeo won reelection with a voter turnout of over 90%.

With a per capita gross domestic product of only $824 in 1999, Guyana is one of the poorest countries in the Western Hemisphere. The economy made dramatic progress after President Hoyte's 1989 economic recovery program (ERP). As a result of the ERP, Guyana's GDP increased 6% in 1991 following 15 years of decline. Growth was consistently above 6% until 1995 when it dipped to 5.1%. The government reported that the economy grew at a rate of 7.9% in 1996, 6.2% in 1997, and fell 1.3% in 1998. The 1999 growth rate was 3%. The unofficial growth rate in 2000 was 0.5%.

Developed in conjunction with the World Bank and the International Monetary Fund (IMF), the ERP significantly reduced the government's role in the economy, encouraged foreign investment, enabled the government to clear all its arrears on loan repayments to foreign governments and the multilateral banks, and brought about the sale of 15 of the 41 government-owned (parastatal) businesses. The telephone company and assets in the timber, rice, and fishing industries also were privatized. International corporations were hired to manage the huge state sugar company, GUYSUCO, and the largest state bauxite mine. An American company was allowed to open a bauxite mine, and two Canadian companies were permitted to develop the largest open-pit gold mine in Latin America. However, efforts to privatize the two state-owned bauxite mining companies, Berbice Mining Company and Linden Mining Company have so far been unsuccessful.

Most price controls were removed, the laws affecting mining and oil exploration were improved, and an investment policy receptive to foreign investment was announced. Tax reforms designed to promote exports and agricultural production in the private sector were enacted.

Agriculture and mining are Guyana's most important economic activities, with sugar, bauxite, rice, and gold accounting for 70%-75% of export earnings. However, the rice sector experienced a decline in 2000, with export earnings down 27% through the third quarter 2000. Ocean shrimp exports, which were heavily impacted by a 1-month import ban to the United States in 1999, accounted for only 3.5% of total export earnings that year. Shrimp exports rebounded in 2000, representing 11% of export earnings through the third quarter 2000. Other exports include timber, diamonds, garments, rum, and pharmaceuticals. The value of these other exports is increasing.

Since 1986, Guyana has received its entire wheat supply from the United States on concessional terms under a PL 480 Food for Peace program. It is now supplied on a grant basis. The Guyanese currency generated by the sale of the wheat is used for purposes agreed upon by the U.S. and Guyana Governments. As with many developing countries, Guyana is heavily indebted. Reduction of the debt burden has been one of the present administration's top priorities. In 1999, through the Paris Club "Lyons terms" and the heavily indebted poor countries initiative (HIPC) Guyana managed to negotiate $256 million in debt forgiveness.

In qualifying for HIPC assistance, for the first time, Guyana became eligible for a reduction of its multilateral debt. About half of Guyana's debt is owed to the multilateral development banks and 20% to its neighbor Trinidad and Tobago, which until 1986 was its principal supplier of petroleum products. Almost all debt to the U.S. Government has been forgiven. In late 1999, net international reserves were at $123.2 million, down from $254 million in 1994. However, net international reserves had rebounded to $174.1 million by January 2001.

Guyana's extremely high debt burden to foreign creditors has meant limited availability of foreign exchange and reduced capacity to import necessary raw materials, spare parts, and equipment, thereby further reducing production. The increase in global fuel costs also contributed to the country�s decline in production and growing trade deficit. The decline of production has increased unemployment. Although no reliable statistics exist, combined unemployment and underemployment are estimated at about 30%.

Emigration, principally to the U.S. and Canada, remains substantial. Net emigration in 1998 was estimated to be about 1.4% of the population, and in 1999, this figure totaled 1.2%. After years of a state-dominated economy, the mechanisms for private investment, domestic or foreign, are still evolving. The shift from a state-controlled economy to a primarily free market system began under Desmond Hoyte and continued under PPP/CIVIC governments. The current PPP/C administration recognizes the need for foreign investment to create jobs, enhance technical capabilities, and generate goods for export.

The foreign exchange market was fully liberalized in 1991, and currency is now freely traded without restriction. The rate is subject to change on a daily basis, but the Guyana dollar has depreciated 17.6% from 1998 to 2000 and may depreciate further pending the stability of the post-election period.