The International Monetary Fund (IMF) Executive Board has concluded its Article IV Consultation with Guyana, highlighting the country's robust economic transformation. The report emphasizes Guyana's significant progress in economic growth, driven by rapidly expanding oil production and strong non-oil sector performance.
According to the IMF, Guyana has experienced an average GDP growth rate of 47% annually since 2022, the highest globally. Real oil GDP saw an increase of nearly 58% in 2024, while real non-oil GDP grew over 13%. Inflation rose to 2.9% by the end of 2024 due to higher food prices influenced by international trends and past flooding events.
The fiscal deficit expanded from 5.1% of GDP in 2022 to 7.3% in 2024, primarily due to increased capital expenditure. However, higher oil exports have more than doubled Guyana’s current account surplus in 2024, reaching approximately 24.5% of GDP. Gross international reserves surpassed US$1 billion by the end of 2024, and the Natural Resource Fund accumulated over US$1.1 billion that year.
Looking ahead, the IMF predicts an average annual economic growth of 14% for Guyana over the next five years, spurred by continued robust oil production and non-oil sector expansion. The economy is expected to benefit from positive spillovers from the oil industry alongside improvements in infrastructure and productivity.
The IMF identifies both potential opportunities and risks for Guyana's future economic outlook. Upside risks include further oil discoveries and productivity-enhancing investments which could enhance long-term prospects. Conversely, downside risks involve potential overheating pressures leading to inflation and commodity price volatility affecting inflation and macroeconomic stability.
In their assessment, Executive Directors acknowledged Guyana's substantial economic progress toward high-income status and noted a favorable economic outlook supported by strong fundamentals and a robust external position bolstered by significant oil revenue accumulation in the Natural Resource Fund.
Directors agreed on maintaining a suitable fiscal stance aligned with development needs while commending efforts to eliminate fiscal deficits over time. They stressed implementing a comprehensive medium-term fiscal framework with clear objectives and consistent policy assessments.
Monetary policy was deemed appropriately tight to manage inflation but may require further tightening if inflation risks escalate. Directors encouraged enhancing monetary policy tools and deepening financial markets for better policy transmission effectiveness.
Financial stability remains a priority with ongoing enhancements in financial supervision being supported by Directors who also recognized efforts toward inclusive growth, economic diversification, improved business environments, climate resilience, governance improvements, anti-corruption measures, transparency enhancements in various sectors including extractive industries.
The next Article IV consultation with Guyana is scheduled within a standard twelve-month cycle.