Gov’t committed to maintaining sustainable spending, focused on long-term growth – PPP GS
The People’s National Congress Reform (PNCR), A Partnership for National Unity (APNU), and the Alliance for Change (AFC) lack a proper understanding of how Guyana’s oil revenues are managed, according to General Secretary of the People’s Progressive Party (PPP) Dr Bharrat Jagdeo.
Speaking at a press conference at Freedom House, Robb Street, Georgetown, on Thursday, he emphasised that oil revenues currently account for less than 30 per cent of the national budget, with the non-oil sectors contributing more. He stressed the importance of prudent financial management, noting that the PPP/C government is focused on sustainable development rather than short-term gains.
Jagdeo’s comments followed President Dr Mohamed Irfaan Ali’s announcement of a one-time $200,000 cash grant to every Guyanese household, during a special parliamentary sitting at the Arthur Chung Conference Centre. This initiative, totaling $60 billion, aims to help citizens cope with rising food prices and the broader cost of living.
“This grant will support Guyanese will dealing with cost of living…it is a huge intervention to, generally, assist households, specifically to deal with movement of food prices…it goes beyond the $7 billion we have in this year’s budget to support cost of living initiatives…this is the latest, robust, intervention to tackle the increase in food prices,” he explained.
Dr Jagdeo also highlighted various government initiatives, including COVID-19 grants, pensioners’ grants, and student loan write-offs, emphasising that these interventions are designed to help Guyanese through tough times without jeopardising long-term financial stability.
He reaffirmed that the government has been careful to avoid unsustainable increases in recurrent spending, ensuring that the economy remains resilient even if oil prices fluctuate.
“We have maintained a critical principle: to avoid the difficulties faced by countries like Suriname and Trinidad and Tobago, which struggled with excessive spending when oil revenues declined,” he said.
Earlier this month, in accordance with parliamentary approval, the Government of Guyana made its fourth transfer for 2024, totalling US$300 million (equivalent to G$62.394 billion) from the NRF on October 1, 2024, to the Consolidated Fund. This transfer brings the accumulated withdrawals to date in 2024 to US$1.150 billion (equivalent to G$239.176 billion) within the total of US$1.586 billion (equivalent to G$329.9 billion) approved to be withdrawn in 2024.
Dr Jagdeo explained that use of these resources for investments are about “building for the future,” helping to diversify the economy and create new jobs.
The PPP/C government has made transparency in oil revenue management a priority through the operationalization of the NRF, which is now overseen by an independent board. The NRF Act, amended in 2021, requires the government to seek annual parliamentary approval for withdrawals, ensuring public scrutiny of oil fund usage.
In addition to reforms in the management of the NRF, the government has updated the Petroleum Activities Bill and the Production Sharing Agreement (PSA) to secure better terms for the country. Local companies have also benefitted from the Local Content Act, which has created significant procurement opportunities for Guyanese businesses.
With over 11.6 billion barrels of proven oil reserves and current production at 350,000 barrels per day, Guyana is poised for major economic growth. Production is expected to exceed one million barrels per day by the end of the decade, positioning the country as a significant player in the global oil market.