Guyana Department of State Background

U.S. Department of State Background Note

Guyana

PEOPLE

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.

HISTORY

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, and again following elections in 1997 and 2001. The basically conservative and cooperative nature of Guyanese society has usually contributed to a cooling of racial tensions. Racial tensions, however, do constitute Guyana’s greatest ongoing social stress point.

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 timeframe, 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%. President Jagdeo won re-election again in national elections held on August 28, 2006, the first non-violent elections held in more than 20 years.

GOVERNMENT

Legislative power rests in a unicameral National Assembly, with 40 members chosen on the basis of proportional representation from national lists named by the political parties. An additional 25 members are elected by regional administrative districts. The legislature is not directly elected; each party presents slates of candidates for the National Assembly. After the election, each party leader selects from the party lists the individuals who will represent the party in the National Assembly. The president may dissolve the assembly and call new elections at any time, but no later than 5 years from its first sitting.

Executive authority is exercised by the president, who appoints and supervises the prime minister and other ministers. The president is not directly elected; each party presenting a slate of candidates for the assembly must designate in advance a leader who will become president if that party receives the largest number of votes. Any dissolution of the assembly and election of a new assembly can lead to a change in the assembly majority and consequently a change in the presidency. Most cabinet ministers must be members of the National Assembly; the constitution limits non-member “technocrat” ministers to five. Technocrat ministers serve as non-elected members of the National Assembly, which permits them to debate but not to vote.

The highest judicial body is the Court of Appeal, headed by a chancellor of the judiciary. The second level is the High Court, presided over by a chief justice. The chancellor and the chief justice are appointed by the president.

For administrative purposes, Guyana is divided into 10 regions, each headed by a chairman who presides over a regional democratic council. Local communities are administered by village or city councils.

Principal Government Officials
Executive President--Bharrat Jagdeo
Prime Minister--Samuel A. Hinds
Foreign Minister--S.R. “Rudy” Insanally
Ambassador to the U.S. and OAS--Bayney Karran
Permanent Representative to the UN--S.R. "Rudy" Insanally

Guyana maintains an embassy in the United States at 2490 Tracy Place NW, Washington, DC 20008 (tel. 202-265-6900).

POLITICAL CONDITIONS

Race and ideology have been the dominant political influences in Guyana. Since the split of the multiracial PPP in 1955, politics has been based more on ethnicity than on ideology. From 1964 to 1992, the PNC dominated Guyana's politics. The PNC draws its support primarily from urban Afro-Guyanese, and for many years declared itself a socialist vanguard party whose purpose was to make Guyana a nonaligned socialist state, in which the party, as in communist countries, was above all other institutions.

A majority of Indo-Guyanese have traditionally backed the People's Progressive Party. Rice farmers and sugar workers in the rural areas form the bulk of PPP's support. Indo-Guyanese who dominate the country's urban business community also have provided important support to both parties, depending on which was in power at the time.

Following independence, and with the help of substantial foreign aid, social benefits were provided to a broader section of the population, specifically in health, education, housing, road and bridge building, agriculture, and rural development. During Forbes Burnham's last years, however, the government's attempts to build a socialist society, including banning importation of basic foodstuffs, caused a massive emigration of skilled workers, and, along with other economic factors, led to a significant decline in the overall quality of life in Guyana.

After Burnham's death in 1985, President Hoyte took steps to stem the economic decline, including strengthening financial controls over the parastatal corporations and supporting the private sector. In August 1987, at a PNC Congress, Hoyte announced that the PNC rejected orthodox communism and the one-party state.

As the elections scheduled for 1990 approached, Hoyte, under increasing pressure from inside and outside Guyana, gradually opened the political system. After a visit to Guyana by former U.S. President Jimmy Carter in 1990, Hoyte made changes in the electoral rules, appointed a new chairman of the Elections Commission, and endorsed putting together new voters' lists, thus delaying the election. The elections, which finally took place in 1992, were witnessed by 100 international observers, including a group headed by Mr. Carter and another from the Commonwealth of Nations. Both groups issued reports saying that the elections had been free and fair, despite violent attacks on the Elections Commission building on election day and other irregularities.

Cheddi Jagan served as Premier (1957-64) and then minority leader in Parliament until his election as President in 1992. One of the Caribbean's most charismatic and famous leaders, Jagan was a founder of the PPP, which led Guyana's struggle for independence. Over the years, he moderated his Marxist-Leninist ideology. After his election as President, Jagan demonstrated a commitment to democracy, followed a pro-Western foreign policy, adopted free market policies, and pursued sustainable development for Guyana's environment. Nonetheless, he continued to press for debt relief and a new global human order in which developed countries would increase assistance to less developed nations. Jagan died on March 6, 1997, and was succeeded by Samuel A. Hinds, whom he had appointed Prime Minister. President Hinds then appointed Janet Jagan, widow of the late President, to serve as Prime Minister.

In national elections on December 15, 1997, Janet Jagan was elected President, and her PPP party won a 55% majority of seats in Parliament. She was sworn in on December 19. Mrs. Jagan is a founding member of the PPP and was very active in party politics. She was Guyana's first female prime minister and vice president, two roles she performed concurrently before being elected to the presidency.

The PNC, which won just under 40% of the vote, disputed the results of the 1997 elections, alleging electoral fraud. Public demonstrations and some violence followed, until a CARICOM team came to Georgetown to broker an accord between the two parties, calling for an international audit of the election results, a redrafting of the constitution, and elections under the constitution within 3 years. Elections took place on March 19, 2001. More than 150 international observers representing six international missions witnessed the polling. The observers pronounced the elections fair and open although marred by some administrative problems. As in 1997, public demonstrations and some violence followed the election, with the opposition PNCR disputing the results. The political disturbances following the election partially overlapped and politicized a major crime wave that gripped Guyana from the spring of 2002 through May 2003. By summer 2003 the worst of the crime wave had abated, and agitation over the election had subsided. In the spring of 2002, citing the failure of the PPP/C government to fulfill agreements made through an inter-party dialogue process, the PNC/R began a boycott of Parliament. In December 2002 Desmond Hoyte, former President and Leader of the Opposition, died and was replaced by Robert Corbin as chairman of the PNC/R and Leader of the Opposition. Through the spring of 2003 the leaders of the PPP/C and PNC/R worked to restart the dialogue, resulting in the return to Parliament of the PNC/R and a joint communiqué in May 2003. The parties appeared to be on the path to a “constructive engagement,” albeit with some slippage of dates and commitments, until late 2003. A political imbroglio and general lack of trust, however, have resulted in a return to political impasse between the parties.

Lack of legal clarity over voter registration rules, in particular the legality of Guyanese remaining on the voter rolls after emigrating, fed a political stalemate that delayed the 2006 elections as opposition parties demanded a full house-to-house verification of the voter list. Ultimately, the election was held using the 2001 voting list--which the opposition had earlier deemed valid--plus new registrations. The Organization of American States and the Commonwealth observed the 2006 elections and considered them to be largely free and fair.

ECONOMY

With a per capita gross domestic product of only $974 (2006), 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. Annual economic growth was consistently above 6% until 1997, but has been stagnant since then.

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.

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, forestry, fishing and mining are Guyana's most important economic activities, with sugar, bauxite, rice, timber, sea food, and gold accounting for 70%-75% of export earnings in 2006.

The rice and sugar industries performed well in 2006. Rice export earnings, for example, rose 20% from $46.2 million in 2005 to $54.6 million in 2006. Sugar, too, saw a strong climb in earnings from $118 million in 2005 to $145 million in 2006. There are dim hopes for the sugar industry in the near future. A new European Union arrangement signed in 2007 gradually phases out long-standing preferential treatment for Guyana sugar exports over the next three years. Prices for sugar are expected to drop significantly, reducing income from the commodity by as much as 30% in the coming years.

Over the past two years the forestry and fisheries sector have recorded strong performance, contributing 15%-20% to export earnings. Forestry, in particular, is viewed as a strong income opportunity for the country. The industry is also under increased scrutiny as questions are raised over the management and enforcement of contracts of its forestry concessions. The government is considering calls to ban the raw export of certain types of logs in favor of value-added export opportunities that will bring in more foreign exchange.

The stagnant mining sector recorded minimal growth in 2006. Bauxite export earnings rose to U.S. $67 million in 2006, a slight increase over 2005. Gold export earnings experienced a similar increase, reaching $114.4 million in 2006 compared to U.S. $111 million in 2005.

The engineering and construction sectors recorded 12% growth in 2006. Most of this was driven by new hotel construction in the buildup to Guyana’s hosting of the Cricket World Cup in March 2007. New housing projects also spurred the sector forward.

As with many developing countries, Guyana is a heavily indebted poor country (HIPC). Reduction of the debt burden has been one of the administration's top priorities. In 2006 the government continued to pursue initiatives to bring the external debt stock and debt service to a sustainable level. At the end of 2006, these two indicators stood at U.S. $920 million and U.S. $22.6 million, respectively. In March 2007, the Inter-American Development Bank (IADB) provided 100% debt relief for Guyana’s outstanding loan balance and interest as of December 31, 2004, amounting to U.S. $467 million. Immediately preceding the IADB write-off, both the IMF and World Bank also granted $237 million in debt relief, bringing the total to U.S. $701 million.

Also in 2006, through the Paris Club debt relief process, the government concluded an agreement with Japan, which provided for 100% write-off of principal and accrued interest, amounting to $591,327.

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 United States and Canada, remains substantial. 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/C 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 is generally stable.

FOREIGN RELATIONS

After independence in 1966, Guyana sought an influential role in international affairs, particularly among Third World and nonaligned nations. It served twice on the UN Security Council (1975-76 and 1982-83). Former Vice President, Deputy Prime Minister, and Attorney General Mohamed Shahabuddeen served a 9-year term on the International Court of Justice (1987-96).

Guyana has diplomatic relations with a wide range of nations. The European Union (EU), the Inter-American Development Bank (IDB), the UN Development Program (UNDP), the World Health Organization (WHO), and the Organization of American States (OAS) have offices in Georgetown. The Caribbean Community (CARICOM) has its Secretariat headquartered in Georgetown.

Guyana strongly supports the concept of regional integration. It played an important role in the founding of the Caribbean Community and Common Market (CARICOM), but its status as one of the organization's poorest members limits its ability to exert leadership in regional activities. Guyana has sought to keep foreign policy in close alignment with the consensus of CARICOM members, especially in voting in the UN, OAS, and other international organizations. In 1993, Guyana ratified the 1988 Vienna Convention on illicit traffic in narcotic drugs.

Two neighbors have longstanding territorial disputes with Guyana. In 1962 Venezuela challenged a previously accepted 1899 international arbitration award, and claimed all of Guyana west of the Essequibo River--62% of Guyana's territory. At a meeting in Geneva in 1966, the two countries agreed to receive recommendations from a representative of the UN Secretary General on ways to settle the dispute peacefully. Diplomatic contacts between the two countries and the Secretary General's representative continue. Neighboring Suriname also claims the territory east of Guyana's New River, a largely uninhabited area of some 15,000 square kilometers (6,000 sq. mi.) in southeast Guyana. Guyana and Suriname also dispute their offshore maritime boundaries. This dispute flared up in June 2000 in response to an effort by a Canadian company to drill for oil under a Guyanese concession. Guyana regards its legal title to all of its territory as sound. In 2004, Guyana took its maritime dispute with Suriname to the Law of the Sea tribunal for arbitration. The decision of the tribunal is still pending.

U.S.-GUYANESE RELATIONS

U.S. policy toward Guyana seeks to develop robust, sustainable democratic institutions, laws, and political practices; support economic growth and development; and promote stability and security. During the last years of his administration, President Hoyte sought to improve relations with the United States as part of a decision to move his country toward genuine political nonalignment. Relations also were improved by Hoyte's efforts to respect human rights, invite international observers for the 1992 elections, and reform electoral laws. The United States also welcomed the Hoyte government's economic reform and efforts, which stimulated investment and growth. The 1992 democratic elections and Guyana's reaffirmation of sound economic policies and respect for human rights have placed U.S.-Guyanese relations on an excellent footing. Under successive PPP governments, the United States and Guyana continued to improve relations. President Cheddi Jagan was committed to democracy, adopted more free market policies, and pursued sustainable development for Guyana's environment. President Jagdeo is continuing on that course, and United States maintains positive relations with the current government.

In an effort to combat the spread of HIV/AIDS in Guyana, the U.S. Centers for Disease Control and Prevention (CDC) opened an office at the U.S. Embassy in 2002. In January 2003, Guyana was named as one of only two countries in the Western Hemisphere to be included in President Bush's Emergency Plan for AIDS Relief. CDC, in coordination with the U.S. Agency for International Development (USAID), is administering a 5-year multi-million dollar program of education, prevention, and treatment for those infected and affected by the disease. Guyana is a threshold country in the Millennium Challenge Account developmental program.

U.S. military medical and engineering teams continue to conduct training exercises in Guyana, digging wells, building schools and clinics, and providing medical treatment.

Principal U.S. Embassy Officials
Ambassador-- David M. Robinson
Deputy Chief of Mission--Michael D. Thomas
Political and Economic Affairs Officer--John Zak
Chief, Consular Affairs--Susan M. Tuller
Economic and Commercial Officer--Nancy Long
Peace Corps Director--James Geenan
USAID Country Director--Dr. Fenton Sands
CDC Country Director--Dr. Amy Dubois (acting)

The U.S. Embassy in Guyana is located at the corner of Duke and Young Streets, Georgetown (tel. 592-225-4900/9; fax: 592-225-8497).

Other Contact Information
U.S. Department of Commerce
International Trade Administration
Trade Information Center
14th & Constitution, NW
Washington, DC 20230
Tel: 800-USA-TRADE

Caribbean/Latin American Action
1818 N Street, NW, Suite 310
Washington, DC 20036
Tel: (202) 466-7464
Fax: (202) 822-0075

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Revised: May. 2007