PPP Government Will Advance Policy Agenda In Guyana Despite Lingering Tensions With APNU

• President Irfaan Ali will implement expansionary fiscal policies in Guyana over the coming quarters to finance development projects and raise household incomes. Ali, who took office in August 2020, has pledged to raise spending as his centre-left People’s Progressive Party/Civic (PPP) government holds a one-seat majority in the National Assembly. 
• It is anticipated that the Ali government will sustain higher spending in the coming years, capitalizing on the country’s offshore oil boom and its transformational impact on public revenues. The 2021 budget raises total expenditures by 16.1% and concentrates much of the spending increases on transfer payments to low-income Guyanese households and those adversely impacted by the pandemic. 
• Due to efforts to sustain social stability, Fitch Solutions maintained Guyana’s score of 54.4 in its Short-Term Political Risk Index (STPRI), putting the country in 24th position among 26 Caribbean economies in the STPRI. 
• However, the political environment between the PPP and opposition A Partnership for National Unity (APNU) will remain tense, particularly as the PPP pushes to remove electoral officials linked to allegations of fraud during the March 2020 election. 

(Source: Fitch Solutions)