The IMF projects strong economic growth for Guyana, estimating 10¼ percent GDP growth in 2025, with a notable contribution from the oil sector. Non-oil GDP is expected to grow by 13 percent, while inflation might rise to around 4 percent. The IMF advises the government on maintaining fiscal stability and suggests social policies to enhance inclusive growth.
The International Monetary Fund (IMF) forecasts strong economic growth for Guyana, attributing this transformation primarily to the burgeoning Oil and Gas sector alongside advancements in non-oil sectors. In a preliminary report from the 2025 Article IV Mission, the IMF noted an unprecedented real GDP growth rate of approximately 47 percent for 2022-2024 due to expanding oil production, strong non-oil performance, and large public infrastructure investments.
The IMF anticipates Guyana’s Gross Domestic Product (GDP) to grow by about 10¼ percent in 2025, with the non-oil economy projected to increase by 13 percent. Inflation is expected to rise gradually to roughly 4 percent by the end of 2025, up from nearly 3 percent at the end of 2024.
Moreover, the budget deficit is predicted to narrow to approximately 5 percent of GDP in 2025, from 7.3 percent in the previous year. The IMF emphasized that an influx of oil revenues will more than compensate for the expected rise in government spending. The current account surplus is also likely to diminish, from 24½ percent of GDP in 2024 to around 9 percent in 2025, mainly due to the import of a new oil Floating Production Storage and Offloading (FPSO) vessel.
Looking ahead, the IMF’s medium-term outlook for Guyana remains bright, with anticipated average annual growth of 14 percent over the next five years. This growth is expected to be underpinned by robust oil output and a strengthened non-oil sector, with non-oil GDP projected to expand by approximately 6¾ percent annually. However, risks such as overheating pressures could jeopardize this prospective growth, potentially leading to inflation increases and exchange rate appreciations.
The IMF further cautioned about external factors, such as commodity price fluctuations and climate-related shocks, which could affect inflation and the broader economic landscape. The report recommended that Guyana’s authorities maintain macroeconomic stability and fiscal sustainability while promoting inclusive growth. Recent social transfer policies have reportedly increased disposable income and lowered poverty levels in the country.
Continued vigilance is advocated in monitoring macroeconomic developments to avoid overheating. The IMF suggested implementing targeted social transfers to foster inclusive growth and facilitate Guyana’s progression towards the sustainable development goal of eradicating poverty. This mission engaged with various officials, including Vice President Bharrat Jagdeo and Finance Minister Dr Ashni Singh, during consultations from February 2024 to March 7, 2025.
In conclusion, the International Monetary Fund’s recent report highlights a strong economic outlook for Guyana, driven by its Oil and Gas sector and a robust non-oil economy. Growth projections remain high, albeit with inflationary risks that warrant careful policy management to sustain macroeconomic stability. Continued social initiatives are essential to ensure growth benefits all citizens and support the country’s ambitious targets for sustainable development.
Original Source: newssourcegy.com
