Guyana records economic growth during pandemic

The World Bank says Guyana’s economy grew by 72.03 percent between 2019 to 2021, the largest growth rate in the Latin America and Caribbean (LAC) region.

This was outlined in the World Bank’s semiannual report for Latin America and the Caribbean which was published earlier this month.

The World Bank noted that many countries in the region, particularly the tourism-dependent nations, recorded economic declines. However, Guyana was among the 12 countries that recorded positive economic growth over the past two years and the country’s cumulative economic growth was the only one with a double-digit growth rate. Nicaragua, the country with the second-highest cumulative growth rate, grew at about 7.53 percent.

Guatemala, Chile, the Dominican Republic, Paraguay, Costa Rica, Colombia, El Salvador, Honduras, Peru, and Brazil were the other countries with positive growth rates.

Though not explicitly stated in this report, Guyana’s economic growth is underpinned by the development of a nascent oil and gas sector and spin-off developments.

The World Bank noted that although the country’s non-oil economy has been affected by the COVID-19 pandemic and climate-related challenges (flooding), the development of the oil economy, facilitated Guyana’s economic expansion.

Based on new growth projections, Guyana’s real GDP is expected to expand by 47.9 percent this year. The trend of economic growth is expected to continue in 2023 with a 34.3 percent, and in 2024 with a 3.8 percent growth rate.

In its Global Economic Prospects report, released in January, the World Bank stated that Guyana’s growth projection for 2022 was 49.7 percent.

In the semiannual report, the World Bank briefly mentioned Guyana’s vulnerability to flooding. Like other countries in the LAC region, the Bank pointed out that climate change poses significant challenges to the local economy.

“Coastal cities are also threatened by sea-level rise; 60 of the 77 most densely populated cities in the region are located on the coast,” the World Bank said.

It also highlighted that without climate adaptation measures, agricultural production in the region may be hard hit. And altogether, the Bank warned that climate change could drive millions of people in the LAC region back into extreme poverty.