Country Risk Rating

A very uncertain political and economic outlook and a business environment with many troublesome weaknesses can have a significant impact on corporate payment behavior. Corporate default probability is high. - Source: Coface

Business Climate Rating

The business environment is difficult. Corporate financial information is often unavailable and when available often unreliable. Debt collection is unpredictable. The institutional framework has many troublesome weaknesses. Intercompany transactions run major risks in the difficult environments rated C.


  • Attractive prospects for investors in mining, hydroelectric power and agriculture
  • Abundant offshore oil and gas reserves, being developed since 2020
  • Member of the Caribbean Community and Common Market (CARICOM)


  • Reliance on natural resources (gold, bauxite, sugar, rice, wood and, above all, oil from 2020 onwards)
  • Shortcomings in transport, electricity, education and health infrastructure
  • Low-skilled local labor force and large-scale emigration of educated workers
  • Sensitive to climatic events (region severely affected by hurricanes)
  • Reliance on international creditors
  • High crime rate linked to drug trafficking amid a background of poverty and corruption (ranked 83/180 by Transparency International's Corruption Perceptions Index in 2020)

Current Trends

The oil sector development will drive dizzying growth

In 2022, activity will continue to post a brilliant performance, tremendously outpacing other neighboring economies’ growth. This is majorly underpinned by the recent strong development of the local energy sector and the supportive international oil prices, which have also boosted related services, construction, private investment, and exports. Oil output will increase from 120,000 b/d in 2021 to 320,000 in 2022, thanks to a new facility in the Liza field. Since the American company Exxon-Mobil discovered an offshore oil field off the coast of Guyana in 2015, explorations have revealed higher quantities of oil. Indeed, in October 2021, the company increased its estimate of the discovered recoverable resource to approximately 10 billion oil-equivalent barrels. Moreover, rising oil tax revenues will allow the government to increase social spending while raising public investment. Still, the oil sector windfall and the economic reopening (amid the progress in COVID-19 vaccination) should also contribute to the increase in household consumption (69 % of GDP). Downside risks are related to possible new COVID-19 strains, the behavior of oil prices, and potential threats to social stability. The latter risk concerns the historical frictions between the Indo and the Afro-Guyanese.


Oil will allow the current account to switch to a surplus and the fiscal deficit to shrink

The current account deficit should turn into a surplus in 2022, driven mainly by the positive trade balance, as high oil prices and rising production will support exports. This should offset the rise in capital goods imports, such as the higher purchase of machinery and equipment for oil development and more robust public investments. Likewise, the services deficit should continue to rise, driven by oil-related services. Foreign direct investment (33% of GDP) should increase thanks to investments directed towards the energy sector. Besides, foreign exchange reserves amounted to USD 819 million as of September 2021 (equivalent to only 1.9 months of imports). Looking ahead, the expected shift of the current account to a surplus in 2022 and the strong inflow of FDI could improve the country´s international reserves position. In addition, Guyana’s Natural Resource Fund stood at USD 267.7 million at the end of March 2021 (USD 246.4 million in oil earnings and USD 21.3 million in royalties). Finally, in Q3 2021, external public debt was at USD 1.3 billion (or 25% of 2020 GDP), of which 64% is owed to multilateral.


Regarding the fiscal account, the government maintained a high deficit in 2021. This was underpinned by increased public investment and the still high COVID-19 expenses. In 2022, the fiscal deficit will dramatically narrow. The solid expected GDP growth and favorable oil prices will support tax intakes and more than compensate for the rise in public expenditure. While COVID-19-related spending is set to decline, the government will continue to take advantage of the oil sector windfall to support expanding other activities (including public works).


The government has focused on seeking more favorable conditions for future oil contracts and improving the local power system

President Irfaan Ali from the center-left People’s Progressive Party/Civic (PPP) took office in August 2020. He succeeded David Granger, who had headed a multi-ethnic coalition, the People´s National Congress or PNC, led by the APNU and its junior partner, the AFC. Historical frictions exist between the two major parties (the PPP and the APNU). While the Indo-Guyanese community broadly supports the PPP, the Afro-Guyanese population favors APNU or AFC. Mr. Ali’s party has 33 parliamentary seats, which gives him a majority in the 65-seat National Assembly (the APNU+AFC coalition has 31 seats). Since taking office, Mr. Ali´s administration has eased its critics on the APNU 2016 production sharing agreement with ExxonMobil (considered disproportionally favorable for the company, with the government getting 2% royalties and 50% of profits). In August 2021, it stated its intention to increase oil royalties as part of a new profit-sharing agreement for future crude and gas projects while strengthening environmental regulations. The ruling government also aims to improve the expensive and inefficient power system while reducing its dependence on imported refined oil (the country does not have a local refinery) and constant outages. A cleaner energy strategy announced in October 2021 entails upgrading the transmission and distribution lines, building a gas-fuelled power plant fed by a 220-kilometer pipeline with offshore fields, and expanding hydropower capacity. It has sought private investment to start the plant construction in 2022. In the second stage (2027–2032), demand would also be met by solar and wind projects, replacing fuel oil power plants. This will be key since the country´s power demand is expected to triple over the next five years. The protracted border dispute with Venezuela is unlikely to be resolved in the short term. In September 2021, Venezuela´s president Nicolás Maduro and opposition leader Juan Guaidó agreed that the oil-rich Essequibo region, which Guyana claims as its own, belongs to Venezuela and rejected the International Court of Justice’s role in settling the dispute. 


Coface (02/2022)