Guyana’s multiple major oil discoveries beginning in May 2015 may have set the country on the path to realising a level of wealth not before seen in the Caribbean, but a recent World Bank Review still regards the country as being “one of the poorest in South America.”
The Bank’s Guyana Country Review, last updated on September 3 this year also states that “the country has “the highest emigration rate in the world” with 80% of nationals with tertiary education leaving and more than 55% of its citizens residing abroad. These considerations, among others, the Bank says, places Guyana “among the largest recipients of remittances relative to GDP in Latin America and the Caribbean.”
According to the review, recent rises in active cases of COVID-19 and deaths are cause for concern in a country which, it says, faces “many challenges from the closure of borders and drops in commodity prices during the pandemic,” along with its continued heavy dependence “on exports of gold, bauxite, and agricultural products.”
And according to the World Bank Review, having become “one of the top 20 largest oil and gas reserve holders in the world,” if the country is to properly manage the expected resource windfall, it will need to “improve the quality and capacity of public and private institutions; make revenue collection and management more efficient and transparent; and adopt sound macroeconomic and fiscal management policies.”
The World Bank states in its recently updated Country Review that it is important that, as the government begins to develop the oil and gas sector, it ensures the creation of “governance mechanisms that adhere to international environmental and social standards,” an accomplishment which, it says, “is critical to avoiding many of the issues resource-rich countries have faced.”
According to the updated Review, the current World Bank project portfolio in Guyana amounts to US$61 million across five projects in the areas of education, energy and extractives, flood risk management, and the financial sector. These projects, it says, “contribute to Guyana’s efforts to enhance resilience to natural disasters, improve the quality of education and skills, and support private sector development initiatives, particularly by focusing on improving the business environment and financial sector development, all identified as priorities through broad-based consultations.”
The Review says that human development has been a long-term focus in the Bank’s support to Guyana. It draws attention to a previous project executed here that focussed on “early childhood services” which it says “helped raise literacy and numeracy rates among young learners, as well as a school feeding project that helped increase enrolment.”
The Country Review, meanwhile, alludes to “two ongoing projects in the education sector” which it says targets the building of the country’s future skilled workforce. According to the Bank, The Education Sector Improvement Project targets the improvement of mathematics education and the University of Guyana’s Faculty of Health Sciences while the Secondary Education Improvement Project is also aimed at strengthening mathematics teaching skills and increasing enrolment in secondary schools.
The Report also alludes to the role of the World Bank, through the Guyana Petroleum Resources Governance and Management Project in seeking to support the development of “better legal and institutional frameworks” and “boost the capacity of key institutions to manage the oil and gas sector to maximize economic and social benefits for Guyana.” The Governance and Management Project, it says, “provides a range of technical, advisory, and capacity measures to improve governance and transparency as well as prudent management of the oil and gas sector and its revenues.” The components of the Project include “strengthening institutions, laws, and regulations – including on health, safety, and environmental protection – and promoting strong checks and balances in the process. It will also support the country’s Environmental Protection Agency in overseeing petroleum sector activities to minimise environmental, social, and climate-related risks”, the Review says.
Simultaneously, the Governance and Management Project also supports Guyana’s efforts to mitigate climate change by “advising on the drafting and enforcement of legislation and regulations that forbid routine flaring of associated gas during petroleum production, and the adoption of the Zero Routine Flaring Initiative.” The project, the Bank adds, will also support government efforts to “enhance social accountability through information campaigns and citizen engagement.”
“Through the Flood Risk Management Project, civil works are underway to improve drainage, update critical sections of the East Demerara Water Conservancy dams and channels, and improve hydro-meteorological monitoring.”
The World Bank is also involved, through The Guyana Payments System Project, in seeking to make the national payments system “safer, more modern, and more efficient,” the Bank says, adding that the Bank of Guyana will benefit from increased capacity to operate the country’s core payments infrastructure.
