Days after Guyana signed a US$150 million loan agreement with the Saudi Fund for Development, Vice President Bharrat Jagdeo has assured that the country’s external debt remains relatively low.
At a press conference today, Mr. Jagdeo said when compared to three decades ago, Guyana’s debt is “extremely low”.
He noted that Guyana’s debt is 12% of its GDP, which is one of the lowest in the world, adding that approximately 8% of the country’s revenue is currently being used to service debt.
“Our total outstanding debt will be less than one year of future revenue, in the outer year. Very few countries can have that debt profile. In addition to that, we have not contracted any private variable interest loan. We have two variable interest loans, and they are both from the IFIs – the multilateral financial institutions – all the other loans are fixed rate loans, so we don’t have to worry about interest rate escalation,” the Vice President said.
At the start of 2023, Guyana’s public debt stood at over US$3 billion.
Since then, the country has accessed a number of loans, including three from the Inter-American Development Bank (IDB) totaling US$205 million.
Vice President Jagdeo said the loans are intended to finance major development projects.
“And, when we borrow, we borrow to invest in things that matter. We can pay it back easily. Our health system, the roads, the power plants, the ports, things that our capital, we don’t borrow to eat. We don’t borrow to eat, we borrow to build the capital stock of this country so our people could benefit, they can use that to create new industries and new jobs,” the Vice President said.
He said the Government is carefully managing the country’s debt, noting that prior to the production of Oil and Gas in Guyana, the country’s debt was about approximately 45% of its GDP.
“So, if you look at our history, you will see one thing that the PPP has done, this is one of our greatest successes, that we never speak enough about. People talk about the roads and water and stuff. We took a bankrupt country and restored it to financial viability, and this was even before oil and gas,” he said.
In January, former Auditor General Anand Goolsarran warned the government over its accumulation of public debts from loans, particularly those taken from China.