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Guyana: why did it become one of the countries with the greatest economic progress in Latin America?

Guyana: why did it become one of the countries with the greatest economic progress in Latin America?

Guyana is a small country of 80,000 inhabitants located on the American continent and emerging as an important economic force. Until October 2023, the International Monetary Fund (IMF) reported that the Gross Domestic Product (GDP) of this nation would continue to experience solid growth, up to 38.4%.

Although other Latin American countries are facing a slowdown in their production sectors, Guyana went from being one of the poorest countries in South America to one of those with rapid economic progression. What are the reasons? We will tell you about it in the following article from La República.

Why is Guyana one of the fastest growing countries in Latin America?

Guyana’s rapid economic growth is largely due to the benefits from its oil production and export sector, according to a report from the International Monetary Fund. In that sense, the offshore deposits of this hydrocarbon, drilled by Exxon Mobil Corp in 2015, influenced the size of the economy to quadruple in recent years.

Similarly, the World Bank projects that the oil production of said South American country will increase from 390,000 barrels per day to more than one million in 2027, as new offshore fields are opened in the Stabroek block, which covers 26,800 km² and is located approximately 193 km off the coast of Guyana.

It is worth mentioning that the GDP per capita in Guyana reached almost US$19,000, which has tripled its value since 2019. In addition, the growth of the non-oil sector in said country was driven by infrastructure projects, as well as investment in transportation, housing and increasing human capital.

What is happening with economic growth and inflation in Latin America?

According to World Bank projections, the Economic growth in Latin America this year could be 2.3%, while the Economic Commission for Latin America and the Caribbean (ECLAC) projects an evolution for the region of 1.9% for 2024 (compared to the 2.2% estimated for 2023). If these figures are confirmed, Latin America and the Caribbean would end this year with a GDP that would be 7.7% higher than that of 2019, before the pandemic.

In this way, a scenario is configured characterized by low rates of economic growth, little fiscal space, still high inflation rates, high levels of debt and international financial markets with less liquids, according to the report. ‘Labor Outlook’ of the Regional Office of the International Labor Organization for Latin America and the Caribbean.

ECLAC projects that inflation in Latin America this year will be 3.8% and next year 3.2%. For its part, the Central Reserve Bank registers that inflation in our country reaches 0.5% until December after decreases had been reported in the previous two months.

Source: Larepublica

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