Guyana debt burden falls as IDB calls it one of the world’s fastest-growing economies

The Inter-American Development Bank (IDB) has reported that Guyana's debt burden is falling despite the government borrowing more for infrastructure development. According to the IDB's latest Caribbean Economics Quarterly, debt service now accounts for just five cents of every revenue dollar, down from seven cents before oil production began. The decline in debt service is occurring despite the government's increased borrowing to fund projects such as roads, schools, and other infrastructure.

Guyana's economy has been growing rapidly, with GDP expanding by 19.3 percent in 2025, up from 43.8 percent in 2024. Non-oil growth, which reached 15 percent in 2025, is also contributing to the country's impressive economic performance. The unemployment rate has fallen sharply, from 14.5 percent in the third quarter of 2021 to 6.8 percent in the same period of 2024, indicating a healthier labor market.

The IDB's report highlights that Guyana's low debt burden is largely driven by strong resource revenues, which have outpaced borrowing. This makes Guyana an outlier among its regional peers, as the Bahamas, Suriname, and Trinidad and Tobago have all seen their debt burdens rise in 2025 compared to 2019.

The growth in Guyana's economy is further supported by a strong non-oil sector, with commercial oil production beginning only in late 2019. The country's population has grown from about 700,000 a decade ago to roughly 900,000 today. IMF projections suggest that growth could peak at 22.1 percent in 2028, before moderating to 1.1 percent by 2031 as oil production stabilizes.

While the GDP growth and falling debt service are positive developments, the IDB cautions that Guyana's economic trajectory remains highly uncertain due to its heavy dependence on oil. The bank emphasizes the need for diversification to ensure that the economy sustains its growth beyond the oil peak. The Guyana government has acknowledged this concern, announcing a US$1.65 billion budget for 2026 that includes investments in solar power and a gas partnership with Trinidad to promote diversification efforts.

In conclusion, Guyana's debt burden is falling, and the country is experiencing rapid economic growth driven by resource revenues and a strong non-oil sector. However, the IDB warns that the economy's outlook is uncertain due to its reliance on oil, with a potential slowdown to 1.1 percent growth by 2031. To ensure the sustainability of its economic boom, Guyana must focus on diversification and managing its debt-service ratio effectively.