Exceeding expectations: Guyana’s economy set to soar by 39.2% in 2023, ECLAC reports

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Guyana’s economic growth continues to outpace global trends, with projections soaring beyond expectations, according to the Economic Commission for Latin America and the Caribbean (ECLAC).

ECLAC estimated a growth rate of 39.2% for Guyana this year, a figure in the vicinity of the projection given by the International Monetary Fund (IMF) in its latest World Economic Outlook.

ECLAC’s new report highlights the broader economic landscape in Latin America and the Caribbean, indicating a trend of sluggish growth. It forecasts a modest 2.2% increase in gross domestic product (GDP) for the region in 2023. Subregions are expected to experience slower growth compared to the previous year, with South America, Central America, Mexico, and the Caribbean (excluding Guyana) projected to witness reduced growth rates in 2023 compared to 2022.

“The economic activity in Latin America and the Caribbean reflects ongoing weak growth trends,” stated ECLAC.

the Commission said Global growth remains below historical levels at 3.0% in 2023, with tepid growth of 0.8% in the volume of trade in goods. Despite a decline in inflation worldwide, interest rates in major economies have remained high, limiting financial flexibility throughout the year.

“Domestically, the region faced restricted macroeconomic policy space in both fiscal and monetary terms,” ECLAC said. 

Looking ahead to 2024, ECLAC’s projections foresee a continuation of subdued growth trends in Latin America and the Caribbean. GDP growth is expected to average 1.9%, with all subregions projected to experience lower growth rates compared to 2023.

The main factor propelling Guyana’s growth continues to be the oil and gas sector. 2023’s growth is anticipated to be fuelled by a full year of stable production at ExxonMobil’s Liza projects, and the launch of the Payara oil development project later this year. Payara alone is set to add 220,000 barrels per day (bpd) to Guyana’s daily oil output. To put that in perspective, the Liza field produces 380,000-400,000 bpd. By 2024, with the Payara project reaching full production, Guyana is expected to ramp up its supply to around 620,000 bpd.

ECLAC’s growth projection for Guyana is the highest so far. The government of Guyana, for instance, expects the economy to grow at 28.2% in 2023. Similarly, other banks and regional organizations have projected growth rates hovering between 25% and 28%.

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