38.4% economic growth for Guyana in 2023 – IMF projects

…against regional growth average of 2.3%

The International Monetary Fund (IMF) has released a report showing that Guyana will record 38.4 percent of real Gross Domestic Product (GDP) growth, against a regional growth average of 2.3 percent.
This is contained in their new Regional Economic Outlook report on the Western Hemisphere, to which Guyana belongs. But Guyana’s growth figures make a stark contrast to the 2023 average growth estimates for the Latin America and Caribbean (LAC) Region.
According to the IMF, the LAC Region, with the exception of Guyana, will record just 2.3 percent growth. It is even more glaring when the report zeroes in on the Caribbean alone. According to the report, the Caribbean, with the exception of Guyana, will experience moderate growth of 1.9 percent in 2023.
“Similarly, growth in the Caribbean commodity exporters will slow down in 2023 and further in 2024 as these countries face less favourable external conditions, although Guyana will continue to grow at a robust pace following the discovery of sizable oil reserves,” the report states.
“Economic growth in the Caribbean was strong in 2022 but is moderating this. Real GDP growth in the region (excluding Guyana) firmed to an estimated 4.2 percent in 2022 as countries continued reopening after the COVID-19 lockdowns,” IMF further explained.
A dominant example of the exceptional growth the Region experienced last year is Guyana, which the IMF noted had the world’s highest real GDP growth rate in 2022 (62.3 percent) due to ramping up of oil production. According to the IMF, however, the momentum that carried the Region’s growth throughout last year, appears to have now weakened.
“The tailwinds that supported growth in 2022 appear to be weakening, and growth in the region (excluding Guyana) is expected to moderate to 1.9 percent in 2023,” the IMF explained in their report.
Guyana has already recorded a whopping 59.5 percent real economic growth in the first half of 2023, driven not only by the oil and gas sector, but also the non-oil economy which has been growing for successive years.
This was contained in the Ministry of Finance Half Year Report, which presents stats on Guyana’s economic performance for the first half of the year. The non-oil economy, according to the report, grew by 12.3 percent. According to the report, the growth trend is expected to continue.
The report further disaggregates the growth by sectors. For instance, the gold mining and quarrying sector is estimated to have grown by 89.9 percent in the first half of the year, driven by increased output. The report explains that these increases outweighed the declines observed in the gold mining and bauxite mining subsectors.
Meanwhile, agriculture, forestry and fishing sectors are estimated to have expanded by 7.6 percent in the first half of the year. This was driven by growth in all subsectors – namely other crops, rice growing, livestock, fishing, forestry, and sugar.
When it comes to the oil and gas sector, this has been a major contributor to Guyana’s economic growth. Another oil and gas project – the Payara development – is expected to start up by this year end, in anticipation of targeting an estimated resource base of about 600 million oil-equivalent barrels.
It was only in April 2023 that the Prosperity floating production, storage and offloading (FPSO) vessel, which will service the Payara project, arrived in Guyana to join the other FPSOs – Liza Destiny and Liza Unity – which are currently producing more than 380,000 barrels per day.
Production from the Prosperity vessel is expected to push daily production to some 600,000 barrels a day in 2024. ExxonMobil has said it anticipates at least six projects offshore Guyana will be online by 2027, with possibly 10 FPSOs operational by 2030.
Meanwhile, the Yellowtail development, which will be oil giant ExxonMobil’s fourth development in Guyana’s waters, will turn out to be the single largest development so far in terms of barrels per day of oil, with a mammoth 250,000 bpd targeted. (G3)