Guyana’s Gov Aims for Economic Diversification and 42% GDP Growth in 2024

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Guyana’s economy is still booming.

The gross domestic product (GDP) of Guyana saw a 49.7% jump during the first half of 2024, according to the country’s president, Irfaan Ali.

“In the first half of this year, our overall real GDP grew by an estimated 49.7% in 2024 […] What is impressive is that the non-oil economy continues to grow, and the non-economy grew an estimated 12.6%,” President Irfaan Ali stated during a public ceremony.

Guyanese authorities now expect the economy to grow 42.3% by the end of the year, an increase of 10 percentge points from their previous projection.

Their high optimism contrasts with the more conservative (though still very high) projections made by global organizations. The International Monetary Fund (IMF), for example, forecasts that Guyana’s economy will grow 33.9% this year. The Economic Comission for Latin America and the Caribbean (ECLAC) sees 28.9% growth in 2024.

Guyana has been on a roll, economically speaking. Its GDP grew by 59.5% in the first half of 2023 and has been expanding at a 20%+ rate over the past five years. If the projections of Guyanese authorities for 2024 come to be, the country will be achieving an annual average GDP growth of 38.8% in a period of five years.

Guyana’s economic miracle is largely fueled by the country’s burgeoning oil and gas sector. Crude oil production is on course to increase by 60% in 2024, reaching 228 million barrels, according to a report by the Ministry of Finance and the Bank of Guyana.

During the first half of 2024, oil output reached 113.5 million barrels, up from 68.7 million barrels in the same period last year.

Diversify to win Although Guyana’s recent economic fortunes are fueled by its skyrocketing oil revenues, the rest of the Guyanese economy has also been growing at a healthy pace.

The non-oil economy posted a 12.6% growth in the first half of 2024, up from 11.7% last year, President Irfaan Ali pointed out. The construction industry expanded 43.7%, fed by a US$950 million infrastructure plan.

Guayanese authorities plan to use the momentum from the energy sector to push the rest of the country’s economy. Back in 2022, Guyana’s Finance Ministry outlined a plan to use oil revenues to “lay the foundation” for the future of sectors such as agriculture and infrastructure (for transport and oil), as well as to build schools, hospitals and investing in upskilling programs.

“Notwithstanding the commencement of oil production in Guyana and this illusion that there is windfall revenue, we still feel strongly about utilizing as much development support as we can,” said Ashni Singh, Guyana’s Senior Finance Minister, to UK officials during a meeting in November of 2022.

Guyana also has big plans for its BPO game. The country invested US$2.8 million to build two massive campuses for BPO operators. The facilities will house about a dozen call center companies and are expected to generate 15,000 jobs.

Once a small Caribbean economy, Guyana has grown into one of the more vibrant and interesting locations in the eyes of international investors. Its sudden oil fortunes have brought flock after flock of foreign companies to its shores, allowing its economy to expand at almost breakneck speed.

Questions remain, however, on whether Guyana will be able to navigate its extraordinary economic situation. There are a few examples of oil-rich countries succesfuly turning oil revenues into wide-spread prosperity, but instances of the contrary seem to be more common.

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