Guyana treads carefully on future planning, balancing oil-fuelled spending – President Ali

President Dr Irfaan Ali has emphasised that Guyana is taking a cautious, data-driven approach to future development planning, carefully balancing current expenditure fuelled by oil revenues with the long-term risks associated with volatility in the global energy market.
Speaking during a live interview last week, President Ali said that the Government’s economic modelling is deliberately designed to account for both upside and downside scenarios in the oil and gas sector, warning that sudden shifts in global supply and demand could significantly impact national revenues.
The President pointed to ongoing geopolitical conflicts and production disruptions – including tensions involving Venezuela, the Russia-Ukraine war, and instability in the Middle East – as key factors currently influencing global oil prices. He noted that a rapid resolution of these conflicts, combined with increased global production, could lead to a sharp decline in prices.
“Economic models show clearly that supply and demand affect price… It’s easy for persons to sit down there and believe that there is no volatility.  We know that the world is undergoing different challenges,” President Ali said, noting that this volatility underscores why the Government has resisted calls for large-scale cash transfers or unsustainable increases in recurrent spending. He warned that basing current expenditure on overly optimistic oil price projections could destabilise the economy, forcing the country to draw down its Natural Resource Fund or resort to borrowing to meet basic obligations.
According to the Head of State, Guyana’s economic framework is not built on speculation but on careful modelling that evaluates median, best-case, and worst-case outcomes in the oil and gas market. He said this approach is critical to ensuring economic resilience and avoiding boom-and-bust cycles that have affected other resource-rich nations.
President Ali also stressed the importance of understanding global energy trends, noting that oil-producing countries are increasingly focusing on using petroleum revenues to fuel innovation, technology, and diversified industries. He referenced developments in the Middle East, where investments are being channelled into hyperscale data centres, artificial intelligence, advanced manufacturing, and petroleum-based products rather than reliance on raw exports.
He said Guyana must adopt a similar strategy to avoid becoming “oil and gas rich but not economically rich” in the long term. As a result, Government incentives and investments are being geared toward expanding multiple pillars of the economy.
These include transforming Guyana into a powerhouse for food production, environmental and climate services, agro-processing for the Caribbean and Latin America, ecotourism, and the orange economy, while also positioning the country as an emerging industrial hub for the wider region.
“This phase of oil and gas development must be used to create generational wealth,” President Ali said, explaining that rapid economic diversification is necessary as global conditions continue to normalise and evolve.
“We have to be part of that model.  Otherwise, we would find ourselves oil- and gas-rich but not rich from an economic standpoint long into the future. That is why sustainable, resilient investments are key in the model that we are building. That is why the incentives are geared towards making Guyana a powerhouse in food production, a powerhouse in environmental services, a powerhouse in climate services, an industrial hub for the Caribbean and Latin America, an agro-processing hub for the Caribbean and Latin America, a powerhouse in ecotourism, and a powerhouse in the orange economy. It is using this phase to power this generational wealth opportunity and to expand the pillars of the economy at a rapid pace,” the Guyanese leader explained.
He concluded by assuring that the Government’s planning takes into account both current global instability and future normalisation efforts, including diplomatic initiatives led by major powers, to ensure that Guyana’s development remains sustainable, resilient, and forward-looking.