On the heels of the Finance Ministry’s mid-year report, which boasted of Guyana’s economic prospect, an International Monetary Fund (IMF) mission has also found that the country’s economic growth rate remains one of the fastest in the world.

In a brief report, the IMF mission said on the back of a 62.3% growth rate last year, real GDP is expected to continue to grow extremely fast in 2023 reaching 38%.

The IMF has attributed the growth to the country’s growing oil and gas sector.

According to the IMF, “Oil production is ramping up with the coming on stream of a third oil field, and growth in the non-oil sector is supported by the implementation of a fast-paced public investment program focused on providing transportation, housing, and flood management infrastructure, and raising human capital. Spillovers from oil and construction are supporting growth in the services and supplies sectors, while agriculture, mining and quarrying are also performing well. After a strong 2022, in the first half of 2023 real non-oil GDP grew by 12.3 percent”.

Additionally, the IMF mission noted that with rapid oil production continuing offshore Guyana and with three approved oil fields to come on stream between 2024 and 2028, sustained real non-oil GDP growth of 5.5 percent is projected.

“Guyana’s favorable medium-term growth prospects are accompanied by upside and downside risks. On the upside, further oil discoveries would continue to improve growth prospects. Construction growth and strong public investment may support higher than expected short-term non-oil growth but could also lead to inflationary pressures and the appreciation of the real exchange rate beyond the level implied by a balanced expansion of the economy, overheating, and the crowding out of credit to the private sector,” the team noted.

The mission also found that although there was a growth in employment in the oil and gas, services and construction sectors, the employment rate stood at 12.4% with an estimated negative output gap.

Further, the IMF team projects that the country’s Public sector debt will gradually decline after declines to 26% last year from 43.2% the previous year.

The team also estimated that the real exchange rate is expected to appreciate, and inflation to increase, as the economy closes its development gap.

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