Durrant Pate/Contributor

The International Monetary Fund (IMF) is declaring that Guyana’s economy will sustain the unprecedented growth being experienced, supported by government modernisation and the substantial expansion of the oil and gas sector.

The IMF executive board finds substantial overall real economic growth of 38.4 per cent in 2023 and an average annual growth of 20 per cent from 2024 to 2028. The country’s favourable medium-term growth prospects come with both upside and downside risks.

According to the IMF, “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.”

In its latest assessment of the Guyanese economy, the Washington-based multilateral emphasised the importance of managing resource revenue inflows for macroeconomic stability and sustainability, as well as investing in people, physical infrastructure, and institutions. To address medium-term risks, particularly inflation and real exchange rate appreciation, the IMF suggested maintaining macroeconomic stability through an appropriate policy mix.

The IMF commended Guyana’s commitment to fiscal discipline, which is expected to lead to a balanced growth path, projecting a zero overall fiscal balance by 2028. At the same time, the IMF 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.