December 5, 2023
The International Monetary Fund (IMF) reports that Guyana’s economy is experiencing unprecedented growth, supported by government modernization and the substantial expansion of the oil and gas sector. The IMF executive board finds Guyana’s external position at the end of 2022 to be moderately stronger than suggested by fundamentals and desired policies. The debt-sustainability analysis indicates a moderate risk of overall and external debt distress, with significant improvement expected with incoming oil revenues.
The IMF projects substantial overall real GDP growth of 38.4% in 2023 and an average annual growth of 20% from 2024 to 2028. The country’s favorable medium-term growth prospects come with both upside and downside risks. Upside risks include potential further oil discoveries that could enhance growth prospects, while downside risks involve inflationary pressures, real exchange rate appreciation, adverse climate shocks, and volatile or lower-than-projected commodity prices.
The IMF emphasizes the importance of managing resource revenue inflows for macroeconomic stability and sustainability, recommending a focus on investing in people, physical infrastructure, and institutions. To address medium-term risks, particularly inflation and real exchange rate appreciation, the IMF suggests maintaining macroeconomic stability through an appropriate policy mix. The IMF commends Guyana’s commitment to fiscal discipline, which is expected to lead to a balanced growth path, projecting a zero overall fiscal balance by 2028.
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