Guyana has experienced unprecedented economic growth following the discovery of massive offshore oil reserves, with real GDP expanding by an extraordinary 62% in 2022 and 33% in 2023. However, this growth is highly concentrated in the capital-intensive petroleum sector, which employs less than 1.5% of the national workforce. Traditional sectors, such as sugar, bauxite, and rice, face severe supply-side constraints and a lack of modernisation, while the non-oil sector grew by a much more modest 9.1%.
The rapid influx of foreign capital has put upward pressure on the Guyanese Dollar (GYD) and driven domestic inflation to around 7.5%, raising the cost of living and domestic production. The country's infrastructure remains underdeveloped, with high electricity costs and transport bottlenecks limiting competitiveness.
Youth unemployment is a structural challenge, particularly in rural and hinterland communities, where job opportunities are scarce. Meanwhile, trade liberalisation policies have reduced import tariffs on agricultural equipment and manufactured goods, but local farmers and nascent agro-processing firms struggle to compete with cheaper, large-scale imports from Brazil and North America. Over 25% of the population still lives below the national poverty line, and many rely on public subsidies, which are increasingly under pressure as the government attempts to balance its fiscal priorities.
Evaluate the advantages of international trade to an emerging country, such as Guyana, if it were to fully liberalise its trade.
