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 43.5 percent in 2020, the only country in the Caribbean to register positive GDP growth. Guyana’s gross domestic product (GDP) is projected to grow by 16.4 percent in 2021 with inflation expected to hover around 2 percent. The Government of Guyana (GoG) is taking steps to diversify the economy way from production of commodities such as gold, bauxite, rice and sugar, towards value added industries and services. The United States has been Guyana’s largest trading partner since 2019.
Guyana emerged from a 20-month extra-constitutional and electoral crisis on August 2, 2020 when opposition People’s Progressive Party/Civic (PPP/C) coalition presidential candidate Irfaan Ali was elected as president. This crisis began with a no-confidence vote in the National Assembly in December 2018 that brought down the then-ruling A Partnership for National Unity and Alliance for Change (APNU+AFC) coalition government. Subsequent to the vote, protracted litigation over the no-confidence motion and contested March 2020 national elections ended with certification of the PPP/C coalition victory and Ali’s swearing-in.
Despite global economic headwinds due to COVID-19, Guyana’s nascent oil production made it the fastest growing economy in the world while non-oil and gas GDP contracted by 6 percent. Guyana reopened its borders in October 2020 to all countries so long as travelers present a negative COVID-19 polymerase chain reaction (PCR) test obtained within 72 hours of their travel to Guyana.
Guyana’s medium-term prospects remain positive with the discovery of vast oil reserves in Guyana’s waters that will provide decades of substantial oil revenues. The GoG plans to overhaul the regulatory framework governing its sovereign wealth fund and has yet to tap into the fund, which is held at the New York Federal Reserve Bank. The National Budget of 2021 prioritizes education, health, infrastructure, and agriculture.
The Government of Guyana (GoG) actively encourages foreign direct investment (FDI) and offers tax concessions for priority projects through the Guyana Office for Investment (GO-INVEST). According to the Bank of Guyana’s Half Year Report for 2020, Guyana’s FDI increased from $826.4 million to $834.7 million. The growth in FDI was fueled mainly by developments within the oil and gas sector and its support industries. The GoG plans to table local content legislation before parliament in the first half of 2021. Until the details of this legislation are made publicly available the impact on oil and gas companies investing in Guyana remains unknown.
As of April 2021, the ExxonMobil-led consortium (which includes Hess and the China National Offshore Oil Company) drilling offshore has achieved an 80 percent success rate for its exploratory wells. In March 2021, Exxon announced that it now estimates the Guyana Suriname basin has a basin potential of twice the discovered resources, more than 18 billion barrels of oil.
Guyana offers foreign and domestic investors investment opportunities in agriculture, oil and gas, construction, wholesale and retail, health, transportation, and agro-processing. Opportunities exist within the services sector such as renewable energy, business process outsourcing (BPO), call centers, information technology services, hospitality, and tourism. Guyana is the only English-speaking country in South America, creating unique potential for call centers and other service industries.
The GoG is revising its Low Carbon Development Strategy (LCDS), which serves as its overarching strategy guiding document for government priorities. The GoG’s 2021 priorities include a focus on agriculture, supporting emerging and value-added industries, improving the business climate, investing in sea defenses, and transitioning to renewable energy using gas as a transition fuel. One key concern remains high crime rates. Guyana also ranked 134 out of 190 countries in the World Bank’s 2020 report on Ease of Doing Business. President Ali committed to improving the country’s Ease of Doing Business ranking by establishing a single window business registration system, reducing energy costs and facilitate faster approvals for permits.
|TI Corruption Perceptions Index||2020||83 of 180||http://www.transparency.org/research/cpi/overview|
|World Bank’s Doing Business Report||2020||134 of 190||http://www.doingbusiness.org/en/rankings|
|Global Innovation Index||2020||N/A||https://www.globalinnovationindex.org/analysis-indicator|
|U.S. FDI in partner country||2015||USD 178 million||https://apps.bea.gov/international/factsheet/|
|World Bank GNI per capita||2019||6,630||http://data.worldbank.org/indicator/NY.GNP.PCAP.CD|