Guyana outperforms all LAC economies throughout pandemic

Guyana’s economy grew by 72.03 per cent between 2019 and 2021, outperforming all others in the Latin America and Caribbean, or LAC, region.

In its semi-annual report on LAC released this month, the World Bank noted that many countries in the region, particularly the tourism-dependent nations, recorded economic declines, but 12 countries recorded positive economic growth.

Guyana was the only country with a double-digit, cumulative growth rate. Nicaragua, the country with the second-highest cumulative growth rate, grew at about 7.53 per cent.

The other 10 expanding economies were Guatemala, Chile, the Dominican Republic, Paraguay, Costa Rica, Colombia, El Salvador, Honduras, Peru and Brazil.

Guyana’s economic growth is underpinned by the development of a nascent oil and gas sector, and spin-off developments.

The World Bank noted that although the country’s non-oil economy has been affected by the COVID-19 pandemic and climate-related challenges, including flooding, the development of the oil economy resulted in Guyana’s economic expansion.

Based on new growth projections, Guyana’s real GDP is expected to expand by 47.9 per cent this year. The trend of economic growth is expected to continue in 2023, with growth projected at 34.3 per cent, and in 2024 at 3.8 per cent.

In an earlier report, Global Economic Prospects, released in January, the World Bank had expected the Guyanese economy to expand this year by 49.7 per cent. The current forecast reduces that estimate by nearly two percentage points.

In the LAC semi-annual report, the World Bank briefly mentioned Guyana’s vulnerability to flooding, while noting that it and other countries face significant risks to their economies from climate change.

“Coastal cities are also threatened by sea level rise; 60 of the 77 most densely populated cities in the region are located on the coast,” the World Bank said.

It also noted that without climate adaptation measures, agricultural production in the region may be hard hit, and warned that climate change could drive millions of people in the LAC region back into extreme poverty.

CMC