With the Liza Destiny and Liza Unity FPSOs producing over 370,000 barrels of oil per day, the International Monetary Fund (IMF) has predicted that Guyana will see an over 100 per cent growth in its oil Gross Domestic Product (GDP). It also predicts about 30 per cent growth on average per year during 2023-26.
The financial institution made the foregoing forecast following the conclusion of its 2022 Article IV Consultation with Guyana.
While Guyana is expected to earn more than US$1B in revenues alone this year, the fund has urged the new producer to still be prudent in spending the oil revenues as well as to monitor the pace at which this is executed.
IMF Directors said oil production has the potential to transform profoundly Guyana’s economy with an overall real GDP growth rate projected to reach an unprecedented 57.8 percent in 2022.
The IMF officials highlighted too that Guyana’s commercially recoverable petroleum reserves is expected to reach over 11 billion barrels, one of the highest levels per capita in the world.
They said this could help Guyana build up substantial fiscal and external buffers to absorb shocks while addressing infrastructure gaps and human development needs. Considering the potential challenges related to volatility in global oil prices and effective management of natural resources, the officials were keen to note the need for continued prudent policies and structural reforms to avoid buildup of macroeconomic vulnerabilities, ensure inclusive growth and intergenerational equity, as well as address structural weaknesses and climate challenges.
Directors also called for the continuation of broad-based reforms to diversify the economy, emphasizing the significant human development and infrastructure needs.
In conclusion, they commended the authorities’ progress in strengthening Guyana’s anti-corruption framework and fiscal transparency and encouraged continued progress on the implementation of the recommendations provided by the Extractive Industries Transparency Initiative (EITI).
