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With oil production driving tremendous growth in export, Gross Domestic Product (GDP) growth, and government revenues and expenditures in the medium term, the Inter-American Development Bank (IDB) has lauded Guyana’s macroeconomic context as that of a booming economy.
In the December edition of its Caribbean Economics Quarterly Report: Headwinds Facing the Post-Pandemic Recovery, the IDB recounted that in its October 2022 World Economic Outlook (WEO), the International Monetary Fund (IMF) had increased its estimates for Guyana’s oil production and GDP growth.
This was due to incorporating oil production from two additional floating, production, storage and offloading (FPSO) vessels.
The new estimates, therefore, account for higher levels of oil production and higher energy prices, which significantly support Guyana’s main export flows.
As a result, Guyana’s volume of exported goods is projected to increase by an annual average of 50 per cent from 2022 to 2026.
This is 27.5 per cent higher than the IMF’s earlier estimate of 22.5 per cent in its April 2022 WEO.
The inclusion of the two additional FPSOs in the IMF estimates also shifted annual average GDP growth estimates for the period 2022 to 2026, from 18.5 per cent to 31.6 per cent; reflecting a 13.1 per cent increase.
The IDB report further details that the government revenues and expenditures are expected to follow a similar trend, with estimated average annual growth sitting at 20 per cent and 11 per cent, respectively, from 2022–2026.
This is expected to yield fiscal primary surpluses and near-balanced budgets in the medium term.
At the beginning of 2022, it was estimated that Guyana’s real Gross Domestic Product (GDP) would grow by 47.5 per cent, with the non-oil economy expected to expand by 7.7 per cent.
However, Senior Minister within the Office of the President with responsibility for Finance, Dr Ashni Singh, announced that the economy surpassed those predictions, with real growth of 62.3 per cent overall, with an 11.5 per cent increase in non-oil real GDP. (GDP)