–largely driven by oil and gas, agriculture sectors, ECLAC reports
AS 2024 draws to a close, Guyana has emerged as the standout performer in Latin America and the Caribbean, with exports set to increase by an astounding 77 per-cent, largely driven by the country’s oil and gas, and agriculture sectors.
This was according to the Economic Commission for Latin America and the Caribbean (ECLAC)’s ‘International Trade Outlook for Latin America and the Caribbean, 2024’ which was released this month.
The report highlighted that following a contraction of 1.2 per cent in global goods trade in 2023, the world economy is tentatively rebounding in 2024, with global goods trade growing by one per cent.
In contrast, Latin America’s trade outlook is more optimistic, with regional goods exports projected to increase by four per cent in value for the year.
However, Guyana’s growth stands out in the region, fuelled by a significant rise in the volume of its oil exports and agricultural products like soybeans.
This exceptional performance positions Guyana ahead of other nations. Suriname, for example, is expected to see a more modest 12 per cent export growth.
Caribbean projected variation in goods trade, by price, volume and value, 2024 (Percentages)
Larger economies like Brazil and Mexico are forecast to experience more restrained growth, with export increases of just three per cent and two per cent, respectively.
In fact, the report found that some nations are grappling with export declines, with Panama’s exports set to plummet by 71 per cent due to the closure of the Cobre Panamá mine.
Across the broader region, agricultural exports have experienced significant volume increases, including a rise of up to 100 per cent in certain products like maize and soybeans.
However, the Caribbean continues to face challenges, particularly in food security. The region remains a net food importer, and the cost of accessing a healthy diet is the highest in Latin America and the Caribbean, surpassing the global average by 30 per cent.
This food insecurity is compounded by high import tariffs and logistical challenges. Services trade is also contributing to the region’s recovery.
In 2024, regional services exports are projected to grow by 12 per cent, with travel and modern services being the primary drivers.
This marks the fourth consecutive year of double-digit growth in services exports, signalling that while goods exports are important, services—particularly tourism and digitally delivered services—are becoming an increasingly significant contributor to the region’s economic activity.
Despite these positive export trends, the region’s economic growth remains weak.
With a projected 1.8 per-cent GDP growth for 2024, Latin America continues to face sluggish demand for imports, with regional imports expected to rise by only two per cent.
Nevertheless, the region’s trade balance is improving. Latin America and the Caribbean are set to move from a US$26 billion trade deficit in 2023 to a US$36 billion surplus in 2024, driven by strong export performance in countries like Guyana and Argentina.
Guyana’s exceptional export growth is helping to boost the overall Caribbean trade performance, with export volumes in the subregion set to expand by 24 per cent.
This surge is largely attributed to oil exports, which have been the backbone of Guyana’s export growth. However, the Caribbean’s food trade deficit and high import costs remain persistent challenges, with food security continuing to be a critical issue, particularly in countries like Haiti.
While Latin America and the Caribbean are recovering from the global trade slump of 2023, this year’s trade figures emphasise the region’s continued reliance on commodities for export growth.
As of December 2024, Guyana’s remarkable 77 per cent export growth reflects its resource-rich economy and highlights the region’s uneven recovery, with some countries seeing strong growth while others face contraction.
The country had recorded export earnings of US$10.221 billion in the first half of 2024, according to the Mid-Year Report released recently by the Ministry of Finance.
According to the report, the merchandise trade balance registered a surplus of US$6.976 billion in the first half of the year, compared with the surplus of US$2.340 billion recorded in the corresponding period of last year.
This improvement was largely supported by a significant ramp up in crude oil production offshore, following the start-up of Guyana’s third FPSO – Prosperity
Importantly, outside of the oil and gas sector, growth was also seen in non-oil export earnings in the first half of 2024 by some 23.4 per cent.
The earnings from rice and gold expanded by US$24.7 million and US$12.2 million, respectively, with the increase for gold reflecting favourable price developments.
At the start of 2024, Senior Minister in the Office of the President with responsibility for Finance and the Public Service, Dr. Ashni Singh had projected that Guyana’s total export receipts could grow by 41.9 per cent for 2024.
This growth, he added, was expected to be driven by a robust expansion in both oil and non-oil earnings.
At that time, Dr Singh said that the government would continue its focus on developing a conducive environment to boost the country’s trade in both the import and export of goods and services.
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Publish date : 2024-12-09 19:55:00
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