Dear Editor,
IN recent public discourse, confusion has arisen around the concept of wealth—particularly in distinguishing between accounting, economic, and social definitions. I, therefore, wish to clarify these distinctions and contextualise a recent statement made by President Irfaan Ali of Guyana.
President Irfaan Ali stated:

“We have seen around us countries that made the mistake of treating oil, of treating natural resources, revenue as wealth… revenue generated from natural resources must be invested to create wealth.”

Accounting Perspective: In accounting terms, wealth is typically defined as net assets. This is calculated using the formula:
Assets – Liabilities = Net Assets.
Assets are considered resources that can be used to generate future economic benefits. Financial ratios such as the asset turnover ratio are used to measure how efficiently firms utilise their assets to generate revenue.

Economic Perspective: From an economic standpoint, wealth is defined by value creation. This refers to the process of using resources to produce goods, services, and innovations that contribute to economic growth.

Wealth creation in this context is dynamic and focuses on how effectively assets are deployed to generate new value over time.
Social Perspective: Socially, wealth is associated with quality of life and collective well-being. It encompasses access to education, healthcare, social equity, and community resilience. In this

view, wealth is not merely about ownership or production, but about how resources improve lives and foster sustainable development.
President Ali’s remarks highlight the importance of understanding wealth beyond its accounting definition.

His emphasis on investing resource revenues to create wealth aligns with both economic and social interpretations—focusing on long-term value creation and societal advancement. Clarifying these distinctions is essential for informed public debate and effective policy-making.
Sincerely,
Joel Bhagwandin