Driven by an oil & gas industry that is projected to significantly transform the face of the country’s economy, possibly in as little as a decade, Guyana continues to attract encouraging external prognoses for growth in the period ahead.
Just months after its earlier released economic projections for Latin America and the Caribbean (LAC) for the period immediately ahead, the World Bank has returned to the theme of the country’s projected growth which it tags at “over 34 per cent” for 2023.
The Bank’s semi-annual report for LAC countries titled “Consolidating the Recovery; Seizing Green Growth Opportunities”, released this month, projects that the country will register a Gross Domestic Product (GDP) growth rate of 34.3 per cent in 2023, likely to be the highest in the LAC region and the only one that will reach double figures.
The second highest growth rate projected for next year is that of St Vincent and the Grenadines, at 7.3 per cent.
For the current year, the World Bank projects a growth rate of 47.9 per cent for Guyana, placing Barbados, with a projected growth rate of 11.2 per cent for 2022 as the only other country in the region likely to reach double figures.
Back in January this year, Senior Minister in the Office of the President with responsibility for Finance, Dr Ashni Singh, had announced that significant injections of revenue from the country’s oil & gas sector had meant that the country’s economy is projected to grow by 47.5% against the backdrop of a generous 2022 budget.
At the heart of this largesse is the country’s oil-rich 6.6 million-acre Stabroek Block where oil recovery by the American giant is being executed along with its subsidiary Esso Exploration and Production Guyana Ltd. (EEPGL), Hess Guyana Ltd, and the Chinese company, CNOOC.
So far, ExxonMobil’s ongoing offshore exploration in Guyana has discovered a recoverable resource of more than 10 billion oil-equivalent barrels. Some US$600 million in direct revenue has gone to the Guyana Government from ExxonMobil’s offshore operations here. All of this after the Liza Unity Floating Production Storage and Offloading (FPSO) had commenced producing oil in the second phase of the Liza project in only February this year.
Not only has oil completely altered the country’s overall economic outlook and raised hopes of significant short to medium-term transformations, it has also given rise to a slew of social infrastructure undertakings in pursuit of an enhancing of well-being and a commensurate lifting of spirits in a country that had been burdened by economic underperformance and its attendant social ills, for generations.
Setting the country’s immediate oil and gas earnings aside it is anticipated that the Yellowtail production phase that will derive from the One Guyana FPSO vessel will develop an estimated oil resource of more than 900 million barrels of oil. The US$10 billion project has recently received both governmental and regulatory approvals. ExxonMobil has already received approval from the Environmental Protection Agency (EPA) for a further three projects.
The US$9 billion Payara development, the third development and one of the largest single planned investments in the country’s history, will reportedly target an estimated resource base of about 600 million oil-equivalent barrels.
Unsurprisingly, the Government of Guyana, through both President Irfaan Ali and his Cabinet Ministers, have been promoting the 2022 budget as a transformational shift for Guyana which they say will boost living standards across the country and invest in long-term infrastructure benefits. With financial resources no longer the excuse that it has been for decades, it is now left to the political administration to keep the promises that they now make virtually on a daily basis.
The attendant transformational outlook has now come to a country that has been chomping at the bit for a change in the fortunes of ordinary Guyanese ever since the 2015 announcement that oil had been found in commercial quantities. Since then, the emphasis of the national clamour has been aimed at upgraded infrastructure, job creation, and an across-the-board enhancement in the standard of living including job-creation and reduction in the costs of consumer goods and utilities.
The private sector, too, has changed gears, zeroing in on what it sees as the lucrative investment openings that can derive from likely joint venture initiatives in partnership with external investors. Small and micro enterprises continue to seek to get the attention of government, focussed as they are on the long-sought goal of poverty alleviation.
