— despite challenges posed by COVID-19, says World Bank

GUYANA’S economy will remain resilient against the effects of the dreaded novel coronavirus (COVID-19) pandemic, maintaining its positive growth trajectory as the burgeoning petroleum sector ‘picks up steam’, the World Bank has said. Based on the latest estimates, the Gross Domestic Product (GDP) of the Latin American and Caribbean Region will be 2.6 per cent lower at the end of 2021 than it was at the end of 2019. The World Bank, in its semi-annual report on the region, said while most of the region should be enjoying strong economic rebound in 2021, Haiti and Suriname are expected to experience negative growth. On the other hand, Guyana’s growth rate will remain in the double digits, the bank said. Guyana grew at an extraordinary rate of 43.5 per cent in 2020, having completed a year of oil production. The positive spillover effects were, however, dampened by a deep contraction in the non-oil economy, triggered by measures to contain the COVID-19 pandemic.
Despite the lingering adversities, projections remain positive, with the country set to record economic growth of 20.9 per cent at the end of 2021, 26.0 per cent in 2022 and 23.0 per cent in 2023.

The country’s GDP of about $6.8 billion is expected to more than double by 2025, reaching over $14 billion. Guyana, a middle-income developing country, is covered by dense forests and is home to fertile agricultural lands and abundant natural resources. Gold, bauxite, sugar, rice, timber, and shrimp are among its leading exports.
This nation, however, attracted international attention after ExxonMobil made the first commercial discovery of oil offshore Guyana in 2015 and started production in December 2019. In September 2020, ExxonMobil made its 18th discovery offshore Guyana at the Redtail-1 well. And, according to the second largest stock exchange in the world by market capitalisation, NASDAQ, Guyana, with its estimated recoverable resources of about nine billion barrels of oil equivalents is projected to be among the world’s largest per capita oil producer by 2025. Data from Norwegian independent energy research and business intelligence firm, Rystad Energy, suggests that close to 300 million barrels of oil equivalent has been discovered on average for each exploration well (wildcat and appraisal) drilled in the country over the past six years. This aside, with around 16 exploration wells planned, including some in riskier frontier regions, 2021 holds a lot of promise, Rystad Energy said.
The energy research firm believes that drilling results will be eagerly watched by the services industry, as more exploration success off Guyana would translate into welcomed opportunities after the market slump of 2020.

MANAGEMENT OF OIL WEALTH
Oil production is undoubtedly contributing significantly to local growth, but the World Bank cautioned Guyana that risks related to the management of wealth generated from the sector remain. “Guyana will be challenged to transform its burgeoning oil wealth into human capital, physical capital, and financial assets for broad-based welfare increases,” the World Bank advised. The country’s oil-and-gas-sector is already pumping finances into its Natural Resources Fund (NRF), with some US$61,090,968 (approximately G$13B) being earned from the sale of the nation’s fifth oil lift. The Government, in keeping with its commitment to accountability and transparency in the petroleum sector, has announced that the country received its latest payment after the sale of 997,420 barrels of oil which were lifted from ExxonMobil’s Liza Destiny on February 5, 2021. The nation, new to the petroleum sector, sold its first one million barrels of crude on February 19, 2020, raking in nearly US$55 million. In its second million-barrel sale, the country received US$35 million, US$46 million as proceeds from the sale of its third million-barrel of crude, and US$49.3 million from its fourth oil lift. Based on a consolidation of all the lifts to date, the country has sold 5,009,797 barrels of oil valuing US$246,542,662. The country is anticipating its sixth lift within the next two weeks. Along with the earnings from the oil lifts and over US$21 million in royalties and interest, Guyana has close to US$267,668,709 in its NRF, at the U.S. Federal Reserve Bank.

BETTER STANDARD OF LIVING
Considering the country’s oil revenue and other lucrative sources of income, President, Dr. Irfaan Ali, has said that the standard of living and the quality of life must be lifted for all. Work will be rewarded; hard work will be rewarded even more, he said. “Opportunities will be created to join in such work, and they will be made available to all. I recognise that there are communities within our society which, because of disadvantages of geographic location, will need more help than others to join our national advance,” President Ali reasoned in an address to the nation in January. The country will have to identify those communities, assess their needs, identify solutions, and implement plans to change their circumstances. This change will not occur overnight, it will take time. But every journey begins with a first step, the President said. “I am confident that the steps which our Government will take in 2021 will continue to lift up our economy, and improve the fortunes of every person within our nation. The task before us in 2021 is to reaffirm our belief in ourselves as one people and one nation, determined to rise together in harmony, showing the world the strength and determination of which we are capable,” President Ali related.