Guyana is located on South America’s North Atlantic coast, bordering Venezuela, Suriname, and Brazil, and is the only English-speaking country on the continent. Guyana became an oil producing nation in 2019 and, with a population of 782,766, is poised to dramatically increase its per capita wealth. While it is currently the third poorest country in the western hemisphere, Guyana’s economy grew by 19.9 percent in 2021. Guyana’s economy is projected to grow by 47.9 percent in 2022 according to the Ministry of Finance, making it one of the fastest growing economies in the world.
Guyana’s is poised for strong economic growth over the next decade as its offshore oil and gas production quickly ramps up to over 1 million barrels per day (bpd), an unprecedented development pace for a country that just discovered commercially viable hydrocarbon resources in 2015. ExxonMobil, the majority shareholder in the consortium (which also includes Hess and the China National Offshore Oil Company) developing Guyana’s offshore oil and gas deposits, increased its estimate for commercially viable oil deposits in Guyana to over 10 billion barrels in October 2021. Industry experts expect Guyana’s total recoverable oil deposits to increase as exploration activities expand to other offshore blocks, which remain unexplored. To manage the windfall from oil and gas production, the Government of Guyana (GoG) amended its sovereign wealth fund legislation in December 2021, thereby opening its coffers for the government to spend most of the fund’s initial balance on needed infrastructure and energy developments and invest in the country’s healthcare and education systems.
Guyana is quickly transforming into a regional destination for international investment. Foreign direct investment (FDI) into Guyana increased from $1.8 billion in 2020 to $4.3 billion in 2021, mainly due to investments in its oil and gas sector. In an effort to diversify the economy away from oil and gas, the GoG is offering incentives for investment in the agriculture, business support services, health, information technology manufacturing and energy sectors, especially in outlying regions, through the Guyana Office for Investment (GOINVEST). At the same time, processes including the government tender process are slow and often opaque, with some tenders expiring and being re-issued after a year passes without decision and no pro-active communication to U.S. bidders.
The GoG lifted most of its COVID-19 domestic restrictions on February 14, 2022, thanks to a significant drop in COVID cases. Proof of vaccination and a negative COVID-19 PCR, or approved antigen, test taken with 72 of travel are still required to enter Guyana. The Ministry of Health (MoH) reports that more than 60 percent of Guyana’s adult population is fully vaccinated, as are 44 percent of children ages 12 – 17. While the GoG remains wary of future variants, the government has indicated a strong resistance to resuming containment and mitigation efforts like mask mandates, nationwide curfews, and strict quarantine requirements.
Climate change presents a clear and present danger to Guyana, especially in its low-lying coastal regions where 90 percent of the population lives. According to the United Nation’s Intergovernmental Panel on Climate Change (IPCC) 2021 report, Guyana’s capital, Georgetown, is forecasted to be under water by 2030 due to rising sea levels. To assist the country’s transition to a more climate resilient economy, the GoG is revising its Low Carbon Development Strategy (LCDS), which seeks to create financial incentives for maintaining the country’s intact forests covering 87 percent of the landmass, watersheds, and unique biodiversity. The strategy is expected to be tabled in parliament in mid-2022 for approval and adoption.
The GoG’s 2022 priorities include significant infrastructure investments, energy developments, improving healthcare services, diversifying and expanding agriculture sector, boosting sea and flood defenses, supporting emerging and value-added industries, and improving the business climate. Key challenges to Guyana’s development include high crime rates, some of the highest cost of electricity in the region, lengthy delays for permits, and access to land. Despite commitments from the GoG to ease regulatory hurdles and improve the business climate, Guyana’s Ease of Doing Business ranking continues to hover at 134 out of 190 countries in the World Bank’s 2020 report.
|TI Corruption Perceptions Index||2021||87 of 175||http://www.transparency.org/research/cpi/overview|
|Global Innovation Index||2021||N/A||https://www.globalinnovationindex.org/analysis-indicator|
|U.S. FDI in partner country ($M USD, historical stock positions)||2015||178 million||https://apps.bea.gov/international/factsheet/|
|World Bank GNI per capita||2020||7,130||https://data.worldbank.org/indicator/NY.GNP.PCAP.CD|
1. Openness To, and Restrictions Upon, Foreign Investment
3. Legal Regime
4. Industrial Policies
5. Protection of Property Rights
6. Financial Sector
7. State-Owned Enterprises
Guyana has ten state-owned enterprises (SOEs) including: National Industrial and Commercial Investments Ltd. (NICIL), Guyana Sugar Corporation (GUYSUCO), MARDS Rice Complex Ltd., National Insurance Scheme (NIS), Guyana Power and Light (GPL), Guyana Rice Development Board (GRDB), Guyana National Newspapers Ltd. (GNNL), Guyana National Shipping Corporation (GNSC) and Guyana National Printers Ltd. (GNPL).
The private sector competes with SOEs for market share, credit, and business opportunities. It is common for SOEs in Guyana to experience political interventions, driven by boards of directors filled with political appointees. Procurement on behalf of SOEs may be passed through the National Procurement and Tender Administration or handled directly by the SOE.
The Public Corporation Act requires public corporations to publish an annual report no later than six months after the end of the calendar year. These reports must be audited by an independent auditor.
8. Responsible Business Conduct
Compared to responsible business conduct (RBC) norms in North America and Europe, Guyana-based businesses lag in adopting RBC policies and activities. However, there is increasing awareness of expectations for responsible business conduct. Guyana does not have a policy to encourage RBC. Most companies conform to their business responsibilities outlined by the Organization for Economic Co-operation and Development (OECD), including human rights and labor rights, information disclosure, environment, bribery, consumer interests, science and technology, competition, and taxation. Guyana’s laws align with the guidelines for RBC by the OECD. Despite these improvements, Guyana has human rights concerns, especially involving child labor in outlying regions and in the mining sector. The GoG enforces human rights laws but many report a lack of capacity to adequately enforce human and labor rights law
Local companies have improved RBC as firms react to increased levels of competition, partly to compete or subcontract with companies in the oil and gas sector that emphasize it. Guyanese consumers are increasingly aware of RBC principles as the population becomes more sensitized. The GoG has expressed hope that large multinational companies will lead the way on RBC practices, setting an example for smaller local firms to follow, particularly in the extractive industries sector. Guyana joined the Extractive Industries Transparency Initiative (EITI) as a candidate country in October 2017. Guyana is not a signatory of the Montreux Document.
The law provides criminal penalties for corrupt practices by public officials. The relevant laws enacted include the Integrity Commission Act, State Assets Recovery Act, and the Audit Act. Notably, the Integrity Commission Board expired in February 2021, with no appointments made as of March 2022. Several media outlets reported on government corruption in recent years, and it remains a significant public concern. Guyana has regulations to counter conflict of interests in the award of contracts. Media and civil society organizations continued to criticize the government for being slow to prosecute corruption cases. The government passed legislation in 1997 that requires public officials to disclose their assets to an Integrity Commission prior to assuming office. There are no significant compliance programs to detect bribery of government officials. Guyana’s Integrity Commission was re-constituted in February 2018 after a 12-year hiatus, but only collects reports of asset declarations and lacks any ability to investigate suspected irregularities, complaints, or issues. The Integrity Commission can only flag asst declarations for investigation by other authorities.
Widespread concerns remain about inefficiencies and corruption regarding the awarding of contracts, particularly with respect to concerns of collusion and non-transparency. In his 2020 annual report, the Auditor General noted continuous disregard for the procedures, rules, and the laws that govern public procurement system. There were reports of overpayments of contracts and procurement breaches. Nevertheless, the country has made some improvements. According to Transparency International’s 2021 Corruption Perceptions Index (CPI), Guyana ranked 87 out of 180 countries for perceptions of corruption, falling 4 spots in comparison to 2020.
Companies interested in doing business in Guyana may contact a “watchdog” organization (international, regional, local nongovernmental organization operating in the country/economy that monitors corruption, such as Transparency International) for more information:
10. Political and Security Environment
Guyana has a high crime rate, and violence associated with drug and gold smuggling is on the rise. The country peacefully transitioned to a new government on August 2, 2020, after a 20 month-long extra-constitutional and electoral crisis, which saw few instances of politically incited violence. The GoG has committed to electoral reform in the wake of the 2020 electoral crisis to avoid future electoral impasses.
The security environment in the country continues to be a concern for many businesses. Businesses considering investing in Guyana are strongly encouraged to develop adequate security systems.
11. Labor Policies and Practices
Guyana’s labor market is tightening due to high investments in the oil and gas sector. In 2017, the total population aged 15 and above residing in Guyana was 550,831. In the first quarter of 2021, the labor force participation rate was 51.1 percent. Unemployment stood at 15.1 percent in the first quarter of 2021. A concerning trend is an increase in youth unemployment, jumping from 30.2 percent in the first quarter 2020 to 31.4 percent in first quarter 2021. Guyana has witnessed an influx of Venezuelan migrants which predominantly work in mining areas and in the restaurant industry. The Ali implementation of LCA adds pressure on an already tight labor market by offering legal protections and incentives for Guyanese companies to service the oil and gas sector, further fueling the flight of labor and investment to the industry. Guyana has a national insurance scheme, but social safety net programs do not exist for the general population. Strikes are common in the sugar industry and may vary with the public sector during collective bargaining sessions. Guyana has a significant informal economy, accounting for a range of 30 and 50 percent of the job market, this is in part attributable to many Guyanese pursuing self-employment in unregulated jobs. In April 2022, GoG leadership suggested there was a labor shortage and they planned to draft a new migration policy.
Local legislation governing labor in Guyana includes the National Insurance Act, Guyana Labour Act, Occupation Health and Safety Act, and the Termination of Severance and Pay Act. Guyana’s Human Development Index for 2020 increased to 0.67 from 0.682. Guyana’s literacy rate is estimated at 90%. There is an ongoing push for information and communications technology curriculum in Guyana’s schools to develop a talent pool for the industry.
Guyana has one of the highest emigration rates, 89 percent, in the world for nationals with a university degree. A significant number of businesses report challenges with staff recruitment and retention. These issues are linked to a small pool of semi-skilled and skilled workers. Companies entering Guyana should consider training and capacity building opportunities for their employees.
The 1997 Trade Union Recognition Act requires businesses operating in Guyana to recognize and collectively bargain with the trade union selected by a majority of its workers. The government, on occasion, has unilaterally imposed wage increases. Guyana adheres to the International Labor Organization (ILO) Convention, protecting worker rights. The public sector has a minimum monthly wage of approximately $350 while the private sector minimum wage is slightly lower at $300.
14. Contact for More Information
Political and Economic Counselor
Economic and Commercial Officer
Economic and Commercial Specialist