Guyana reports substantial GDP growth in the first half of 2024

Guyana’s gross domestic product (GDP) grew by an estimated 49.7 percent in the first half of 2024, driven largely by revenues from the oil and gas sector. The non-oil economy also performed well, recording a growth of 12.6 percent, an increase from 11.7 percent in the previous year.

President Mohamed Irfaan Ali shared these figures during the inauguration of Citizens Bank’s new Mandela Branch in Guyana on Friday.

He highlighted that the construction sector experienced significant growth, expanding by an estimated 43.7 percent. Despite challenges faced by some sectors earlier in the year, the government demonstrated its commitment to improving economic performance.

The president pointed out the banking and financial sector’s transformation since 1992, noting substantial increases in deposits, assets, and private sector credit.

A series of financial sector reforms have been implemented, resulting in a 44 percent increase in credit to the private sector from 2020 to 2023, which has had positive effects on various economic sectors.

“The first wave of reforms included policies aimed at enhancing efficiency and competition within the financial services sector, strengthening the prudential framework and bank supervision, developing and deepening financial markets, and modernizing the payment system,” Ali stated.

The president also mentioned that non-performing loans, which were at an all-time high in 2019, have significantly reduced, showing a 145 percent decline by 2023, reflecting an improved ability of borrowers to repay their debts. He highlighted several initiatives, including low-interest rates for poultry farmers and higher mortgage ceilings, showcasing the government’s commitment to increasing access to financing.

Additionally, last year saw the signing of a US$100 million loan agreement with Small Business Development Finance Trust Incorporated (SBDF) to support the growth of small and medium enterprises and enhance access to financing.

The government plans to update the Financial Institutions Act (FIA) to modernize Guyana’s banking sector and align it with international standards.

These amendments will allow international banks to establish representative offices in Guyana to showcase their financial products, which is expected to stimulate foreign direct investment and increase credit access for local corporate borrowers.

President Ali praised the crucial role played by the country’s two indigenous banks, Citizens Bank and Demerara Bank, in the economic development, transformation, and integration of Guyana.

“We have witnessed the establishment of a stock exchange, the expansion of bank branches nationwide, and significant improvements in the payment system. We have also seen improved access to credit for ordinary citizens, which is evident in the number of new homes being built, the growth of small businesses, and increased commercial activity,” he said.

He emphasized the importance of continued innovation to position Guyana’s financial sector as a key player in international markets. -(CMC)