Budget 2022: Oil production to fuel 47.5% projected growth in Guyana’s GDP

Government projects that Guyana’s overall economic growth for 2022, with the implementation of its transformative budget, will be 47.5%.

This was disclosed by Senior Minister in the Office of the President with responsibility for Finance, Dr. Ashni Singh.

“Real [gross domestic product] GDP is projected to grow by 47.5 percent, a rate of growth which no other country in the world is currently projected to achieve in 2022.”

This projected growth is expected to be fueled by oil production increases brought on by the installation of the Liza Unity floating production, storage and offloading (FPSO) vessel, and the operationalization of the Liza Phase Two project in the first half of the year.

“In the oil and gas subsector, production is expected from both Liza Destiny and Unity FPSOs, and the rate of production for 2022 is expected to be approximately 257,000 bpd on average,” Dr. Singh said.

While production in 2021 averaged just under 120,000 barrels per day, there is potential for this number to triple in 2022, as the Liza Unity bears a nameplate capacity of 220,000 barrels per day, 100,000 barrels more than the Liza Destiny.

Moving to projections for the non-oil economy, Dr. Singh said, “The non-oil economy is expected to continue registering strong growth, currently projected at 7.7 percent this year, driven mainly by rebounds in rice growing and gold mining, and continued expansion in construction activity and wholesale and retail trade and repairs.”

Government forecast the rice growing sector to expand by 25.1 percent in 2022, due to replanting efforts and the introduction of new high-yielding varieties. This represents a significant rebound from the 20.5 percent decline observed in 2021.

The large gold mining sub-sector is anticipated to grow by 12.2 percent due to higher expected declarations from one large operation, and the small and medium -scale miners. This also represents a significant comeback from this sector’s 2021 performance, which saw an estimated contraction of 14.8 percent.

In construction, the Finance Minister said that its continued heavy investment in projects across sectors, and major projects coming from private sector investments, will result in a projected expansion of 10.5 percent.

The forecast growth for wholesale trade and repairs, a subset of services, is 6.5 percent.