Guyana: The World’s Fastest-Growing Economy
A small and humble coastal South American country has shot to the top of the fastest-growing world economies. It has left the other 194 countries in its wake. Guyana is a forward-thinking country and is one of the many South American countries that allow its citizens to buy and sell cryptocurrency, use them to play crypto slots online, etc. Many economists predict that Guyana will experience this spectacular economic growth for at least the next half a decade, possibly longer.
What is driving this phenomenal surge in GDP? Well, recently, oil companies have discovered huge undiscovered oil fields in the country, and it has caused colossal investment and publicity for a country with a population of fewer than one million people.
Why Is Guyana the Fastest Growing World Economy?
This is a fair question. For most of the 21st Century, emerging economies have found themselves at the top of this list. However, due to its size and location, Guyana is often overlooked as a port destination for larger countries along the coast.
Likewise, other more affluent South American nations are considered a better alternative for products and services. Therefore, the economy in Guyana is not regarded as robust or diverse enough to hold its weight against the likes of the Brazilian or Argentinian economies.
In 2022, Guyana’s GDP grew at a rate of 47%. This number is set to continue or plateau, but it is still astonishing. As the country starts from a small and less diverse economy, this discovery has propelled them right up the charts. If the discovery had been made in another more significant and well-rounded country, the increase in GDP might not have been as vast.
However, this colossal discovery has now economically opened many doors for the country. Its capital Georgetown is currently experiencing investment and attention like it hasn’t had before. With over half a trillion dollars of investment into the global oil industry, it looks like affluent times are ahead for Guyana.
Will This Continue?
The future looks promising, with the Guyanese government lining up oil auctions to sell these vast assets to the highest bidder. Despite the global economic downturn, this recent turn of events has unearthed so much of this scarce resource that the Guyanese economy will not have to worry about going into recession for quite some time.
The Guyanese government has stated over the last six months that they plan to reinvest the enormous oil profits they will likely enjoy back into the country. It may take the form of significant investments in healthcare and education. Still, the government is committed to helping the people prosper after so many have lived under the poverty line for so long.
One key point that many residents have noted is that the discovery of oil doesn’t always mean there will be a way out of poverty for many of its residents. On the contrary, many are approaching with caution. For example, Venezuela is the most oil-rich nation on Earth, and there’s more oil in Venezuela than in any country in the Middle East.
However, Venezuela is experiencing immense economic and societal turmoil. Therefore, all this oil certainly hasn’t helped its economy prosper. Quite the opposite. You only need to look at the Exxon Valdez oil spill or the Deepwater Horizon spill to see why some Guyanese are rightly concerned. Approaching this with caution is a wise move. However, seeing this as anything other than an immense positive for Guyana and its people is a challenge.
The Future of Guyana’s Economy
With a staunch commitment to reinvesting the profits back into the nation, the current Guyanese administration is set to use this vast discovery to pull their country into the realms of a prosperous nation.
Guyana has operated on a small budget and has managed well, comparatively speaking, compared to nations of similar stature. Suppose this money can be appropriately reinvested back into the country and used to fuel the growth for future generations. In that case, the possibilities could be fantastic for this small South American nation. It can look to diversify with these rich proceeds and set a foundation to set them on a prosperous path for many decades.
It hinges a lot on how the money is used. Unfortunately, there’s no guarantee that the profits will be used to generate more profits. Although it is now in a much better position than a decade ago, with the world looking to move toward greener alternatives, will the oil that Guyana has discovered continue to hold the same weight?
Any potential for economic growth hinges on this outcome. But unfortunately, even though many of the world’s top economies have promised to cut emissions and oil consumption, they have failed miserably. Oil is so embedded into the entire supply chain of so many of the goods and services we use that it’s doubtful Guyana will not profit handsomely from the recent developments in their country.