Guyana to see “explosive” growth over next five years – BMI report

Global commendation continues to pour in for Guyana, a country on the rise with the fastest-growing economy in the world.

A recent study conducted by Business Monitor International (BMI), a Fitch Solutions Research Unit, has predicted ‘explosive’ growth for Guyana, poised for 115% growth in the next five years.

This growth is said to be propelled by the oil production and export sector.

Andrew Trahan, BMI’s head of risk for Latin America, believes that Guyana will maintain its position as the world’s fastest-growing economy, adding that this growth rate will depend on how quickly additional oil production is brought in.

BMI sees oil production leaping from approximately 390,000 barrels per day this year to over a million barrels per day by 2027, with the opening up of new fields within the Stabroek block.

“Guyana’s robust growth has been, and will continue to be, driven by a rapid expansion of oil production following a series of discoveries in recent years,” Trahan said.

This is not the only organisation that has predicted massive growth for the country’s economy. In a recent report, the International Monetary Fund (IMF) stated that Guyana is poised to sustain its economic momentum in 2023, with a projected Gross Domestic Product (GDP) growth rate of 38 per cent. This follows a record-breaking 62.3 per cent real GDP growth rate in 2022, the highest globally.

Meanwhile, a recent Consumer News and Business Channel (CNBC) article quoted similar sentiments by Valerie Marcel, an associate fellow at the think tank Chatham House, who stressed that it is important Guyana diversifies its economy to avoid the risk of the Dutch disease.

‘Dutch disease’ is a concept that describes the phenomena where rapid economic development in one sector results in rapid decline in other sectors.

“The positive growth trajectory will continue, but that will hinge on the country’s political stability and high oil prices,” the article points out.

However, with these risks in mind, the government has been actively investing in the country’s non-oil sectors, such as agriculture, to promote sustainability and a diversified economy.

In fact, the IMF also reported that, in the first half of 2023, real non-oil GDP grew by 12.3 per cent, supported by the implementation of a fast-paced public investment program focused on providing transportation, housing, and flood management infrastructure, and raising human capital.