–World Bank says in latest report on global economic prospects

GUYANA’S economy remains on course for significant growth this year and in 2023, despite the existing global economic conditions, according to the World Bank in a report published this month titled, Global Economic Prospects.

According to the report, Guyana is projected to grow 47.9 per cent in 2022 and 34.2 per cent next year.

“…Guyana’s economy is forecast to double in size in 2022-2023,” the World Bank said, noting that this is on account of the rapid development of the country’s oil and gas sector.

ExxonMobil is the key stakeholder in most of the ongoing oil and gas activities within Guyana’s waters.

As it is now, the company has four sanctioned projects offshore Guyana. Of those, Liza Phase One is producing approximately 130,000 barrels per day, using the Liza Destiny floating production storage and offloading (FPSO) vessel, while the Liza Phase Two, which started production in February, is steadily ramping up to its capacity of 220,000 barrels per day, using the Liza Unity FPSO vessel.

The third project, Payara, is expected to produce 220,000 barrels per day; construction of its production vessel, the Prosperity FPSO, is running approximately five months ahead of schedule, with start-up likely before year-end 2023. The fourth project, Yellowtail, is expected to produce 250,000 barrels per day when the One Guyana FPSO comes on stream in 2025.

ExxonMobil is also moving ahead with plans for its fifth development project in the Stabroek Block, Uaru, which is expected to produce up to 250,000 barrels of oil per day.

Owing to those and other developmental projects, Guyana, though being susceptible to various economic shocks that are affecting countries across the world, is positioned to maintain a positive economic growth.

In addition to the World Bank, the International Monetary Fund (IMF) had reported that the economic prospects for Guyana remain positive at the close of the first quarter of 2022.

This remains the case for Guyana although growth in even the emerging market and developing economies (EMDEs) has been downgraded to 3.4 per, according to the World Bank.

The World Bank reported that the war in Ukraine is leading to high commodity prices, adding to supply disruptions, increasing food insecurity and poverty, exacerbating inflation, contributing to tighter financial conditions, magnifying financial vulnerability, and heightening policy uncertainty.

Despite the negative shock to global activity in 2022, there is essentially no rebound projected next year: global growth is forecast to edge up only slightly to a still-subdued three per cent in 2023, as many headwinds—in particular high commodity prices and continued monetary tightening—are expected to persist.

“Moreover, the outlook is subject to various downside risks, including intensifying geopolitical tensions, growing stagflationary headwinds, rising financial instability, continuing supply strains, and worsening food insecurity.

“These risks underscore the importance of a forceful policy response. The global community needs to ramp up efforts to mitigate humanitarian crises caused by the war in Ukraine and conflict elsewhere and alleviate food insecurity, as well as expand vaccine access to ensure a durable end of the pandemic,” the World Bank reported.

Guyana has proven in recent times that it is capable of remaining resilient amidst global economic challenges.

The World Bank, after assessing the economic performance of countries during the period 2019-2021, had announced that Guyana recorded the highest cumulative economic growth in the Caribbean and Latin American region.

The international financial institution determined that the country recorded cumulative economic growth of 72.03 per cent, and the closest nation behind Guyana was Nicaragua, which recorded cumulative economic growth of 7.53 per cent. With this rate of overall growth, Guyana ranks among the fastest growing economies worldwide.

“Our economy is becoming stronger; it is rebounding from the two-year-long effects of the coronavirus pandemic. Businesses, both local and foreign, are capitalising on the unfolding opportunities and, in the process, generating jobs and providing incomes for our citizens,” President, Dr. Irfaan Ali, had said in a recent address to the nation.

Based on Budget 2022– the country’s largest to date — the government intends to enhance its approach to stimulating growth in various economic sectors.