Guyana’s economic growth staggered by COVID-19 and elections but expected to grow by over 48%

According to the targets announced for 2020 in the National Budget, Guyana’s Gross Domestic Product (GDP) is expected to grow by between 48.4 per cent and 51.2 per cent.

Minister of Public Works Juan Edghill also projected that the non-oil economy is expected to contract by between 1.4 per cent and 4.3 per cent.

He told the National Assembly while presenting the budget on Wednesday that in the first half of 2020, Guyana’s real economy is estimated to have grown by 45.6 per cent, driven by the petroleum sector.

However, the non-oil economy contracted by 4.9 per cent, with significant declines recorded across many major industries.

“This was, in part, due to the protracted General and Regional Elections, but also a result of the significant reduction in economic activity after the introduction of several emergency measures in the second quarter to curb the spread of COVID-19,” Edghill explained.

These measures saw restrictions being imposed on the movement of persons and operation of non-essential businesses, which, in turn, led to a reduction in household income.

“While there was a phased relaxation of measures in the third quarter, a surge in COVID-19 cases in August has necessitated the reintroduction of more stringent measures. The need to constantly monitor and readjust emergency measures in response to the spread of COVID-19 amplifies uncertainty surrounding the economic performance of various industries for the remainder of this year,” he added.

As such, a few different scenarios are considered in forecasting growth and other macroeconomic indicators for 2020.