…say oil revenues, investment, prudent policies support growth, economic stability
Guyana’s economy is projected to grow by 22.3 per cent in 2026, supported by expanding oil production and continued growth in non-oil sectors, as the International Monetary Fund (IMF) has called for stronger fiscal planning, improved Public Sector oversight and policies to ensure the country’s oil wealth supports long-term, inclusive development.
The projections are contained in the IMF’s October 8, 2026, report following the conclusion of its Article IV Consultation with Guyana. The report assessed the country’s recent economic performance, medium-term outlook and policy priorities for maintaining macroeconomic and financial stability.
The IMF said Guyana continued to expand at one of the highest rates in the world, with real Gross Domestic Product (GDP) growing by 19.3 per cent in 2025, following an average growth of nearly 40 per cent during 2023 and 2024.
The expansion was driven by strong oil production and broad-based activity in the non-oil economy. Oil GDP grew by 21.1 per cent in 2025, while non-oil GDP increased by 14 per cent, supported by construction, agriculture, mining and manufacturing.
Oil production exceeded 900,000 barrels per day during the year, while stronger labour market conditions and private sector credit also supported economic activity. According to the IMF, these trends broadly continued during the first half of 2026.
The Fund projects real GDP growth of 22.3 per cent in 2026, with oil GDP expected to expand by 26.1 per cent and non-oil GDP by 10.2 per cent.
Oil production is expected to continue increasing as new fields come onstream, while non-oil economic activity is projected to remain strong over the medium term. The IMF estimates that non-oil growth will average approximately seven per cent over that period.
The report said the outlook remained favourable, although risks included fluctuations in international oil prices, possible overheating pressures and climate-related shocks. Further oil discoveries, stronger construction activity and higher oil prices were identified as potential sources of additional growth.
Oil savings
The IMF said rising oil revenues had helped strengthen Guyana’s fiscal and external positions while allowing the Government to continue investing in physical and human capital.
The overall fiscal deficit narrowed to 5.5 per cent of GDP in 2025, compared with 7.3 per cent in 2024. The reduction occurred as oil revenues increased, despite continued large-scale public investment.
The non-oil primary deficit as a share of non-oil GDP also declined slightly during 2025.
The Fund noted that the accumulation of oil revenues in the Natural Resource Fund (NRF) had helped build fiscal and external buffers. By the end of 2025, the fund had accumulated approximately US$3.3 billion, equivalent to more than 12 per cent of GDP.
Gross international reserves reached approximately US$1.4 billion in 2025, while the current account surplus widened as oil production increased and oil-related service imports declined.
The IMF assessed Guyana’s external position in 2025 as broadly consistent with the level implied by the country’s economic fundamentals and desirable policies.
The report also noted that Guyana maintained one of the lowest debt-to-GDP ratios in the Western Hemisphere, while investments in infrastructure and human capital continued to support non-oil growth and social outcomes.
However, the IMF projected that the overall fiscal deficit would widen to 6.4 per cent of GDP in 2026, partly reflecting transfers and electricity subsidies, before improving in 2027.
Against this background, the Fund recommended that Guyana continue strengthening its fiscal framework to ensure that oil revenues are managed in a manner that preserves economic stability and supports development over the long term.
It said that if oil prices remained persistently high, a larger share of additional oil revenue should be saved, taking into account the economy’s capacity to absorb increased spending.
The IMF also recommended that public expenditure continue to prioritise productivity-enhancing projects and assistance for vulnerable groups, while improving spending oversight and the performance of key public enterprises.
It called for consideration to be given to improving the targeting of subsidies and gradually replacing broad price-mitigation measures with more targeted support.
Long-term planning
The Fund said a comprehensive medium- and long-term fiscal strategy would help preserve fiscal sustainability and intergenerational equity as Guyana continues to benefit from oil production.
It noted that existing budget frameworks provided a strong foundation for developing clearer fiscal benchmarks to guide the management of oil revenues and public expenditure.
The IMF suggested that the non-oil primary balance could serve as the main operational fiscal target, strengthening gradually over the next decade to a level consistent with a selected long-term objective.
One possible objective identified in the report was preserving the real per capita value of assets held in the Natural Resource Fund.
The Fund said public spending during this transition should remain aligned with Guyana’s development needs and capacity to absorb investment efficiently. It also noted that the high cost of delivering public services in a country with a low population density should be taken into account.
Well capitalised
The report assessed Guyana’s banking system as well capitalised and liquid, with asset quality improving.
Nevertheless, the IMF called for continued vigilance in safeguarding financial stability, particularly in relation to concentration risks. It recommended developing a comprehensive macroprudential framework to strengthen the identification and management of risks within the financial system and improve policy formulation and implementation.
The Fund also identified rapid growth in the housing market as an area requiring close monitoring and recommended developing a real estate price index to improve the assessment of market trends. As financial services become increasingly digital, the IMF said cybersecurity standards should also be enhanced.
Accountability
The IMF welcomed ongoing efforts to improve Public Sector transparency, service delivery and governance but identified several areas requiring further attention as public spending expands.
These include resolving outstanding cost-oil audits, improving the timely publication of accounts by public enterprises and Government agencies, and strengthening audit capacity, particularly in the oil and gas sector. The Fund also stressed the importance of consistent compliance with the public procurement framework.
It recommended continued efforts to strengthen anti-money laundering and counter-terrorism financing arrangements, alongside improvements to the country’s anti-corruption framework. Strengthening the Integrity Commission and the asset declaration regime were identified as additional priorities.
Diversification
Apart from the oil sector, the IMF said Guyana’s development strategy should continue to focus on diversification, resilience and sustainability.
The Fund noted that the country was advancing towards a cleaner and more cost-effective energy mix while maintaining its position in market-based forest conservation. The Gas-to-Energy project is expected to reduce reliance on fuel-based power generation, lower energy costs and support the competitiveness of the economy.
The IMF also identified strengthening human capital, expanding employment opportunities, addressing labour shortages and improving food security as important components of the country’s diversification efforts.
Climate resilience was another priority highlighted in the report, with investments in sea defences, drainage systems and climate-resilient agriculture identified as important to reducing exposure to climate-related risks.
Economic data
The IMF also welcomed efforts to strengthen Guyana’s official statistics, noting that reliable and timely data were important for effective policymaking and assessing the impact of Government policies.
Priorities include updating national accounts and price statistics, further improving external sector statistics, maintaining regular labour force surveys and publishing more complete census results.
The rollout of a new household budget survey was also identified as an important step in strengthening the evidence available to policymakers.
Discover more from INews Guyana
Subscribe to get the latest posts sent to your email.
