Guyana: Government Moves to Increase Debt Ceiling as Development Agenda Accelerates

• To finance several development projects as Guyana continues to progress rapidly, the Government of Guyana intends to increase the country’s debt ceiling, a Senior Minister within the Office of the President with responsibility for Finance, Dr. Ashni Singh has said.
• Dr Singh, during an interview with the News Room, said that the government has been making significant investments and managing the country’s finances responsibly.
• “Given all of these heavy investment initiatives and also ramping up of social programmes, we have of course been incurring a fiscal deficit, this is publicly known. It’s reflected in our annual budget every year, so you finance the budget deficit by borrowing, and we have been borrowing very prudently,” the minister said.
• With Guyana’s rapidly growing economy, it is pertinent that the country adjusts its debt ceiling.
• Guyana’s fiscal deficit is expected to widen from 2.2% of GDP in 2022 to 3.0% in 2023 given falling global energy prices and the government’s planned 41.4% increase in headline expenditure over the year. However, the country is anticipated to record a surplus (0.1% of GDP) in 2024 due to stabilising oil prices, persistent increases in hydrocarbon production and a lower debt-to-GDP ratio.
• This forecast is heavily hinged on a low debt load. Guyana’s debt-to-GDP ratio stood at just 25.8% in 2022, having fallen from a multi-year peak of 47.4% in 2020. Persistent fiscal surpluses from 2024 onwards imply that this ratio will stabilise in the years ahead, averaging 25.6% between 2023 and 2027.

(Source: Guyana Chronicle)