Latest update April 24th, 2026 12:40 AM
Govt. will not borrow above 4% interest rate
Kaieteur News – Guyana’s President Irfaan Ali, during his visit to Washington DC, reiterated his government’s commitment to responsible borrowing practices.
President of Guyana, Irfaan Ali
President Ali made it clear that the country will not borrow loans at a high interest rate, noting that all borrowing of loans by Guyana should be based around a 4% interest margin.
In a discussion on Wednesday with the Inter-American Dialogue think tank, he outlined his vision for the future of the US-Guyana relationship and shed light on his administration’s internal policies for securing loans.
During the discussion, President Ali emphasized that the country would not entertain loans with high-interest rates.
President Ali stated that his administration has set internal policies to guide the borrowing of loans.
He said, “We are not prepared to borrow invariable rates. Many people would say that you’re crazy because in this existing market everything is invariable rates but we have made it a point that any borrowing must be a fixed rate, of less than a very low percent. Less than 4% in most cases and we have been able to achieve this in this existing market.”
This statement comes as the country’s debt recently saw a notable increase. On Monday, Kaieteur News reported, that within six months, the country’s debt has surged to US$3.9 billion, marking a 7.2% increase compared to the end of 2022.
The Ministry of Finance’s Mid-Year Report highlighted that, as of June 2023, Guyana’s total public and publicly guaranteed debt stood at US$3,916.9 million, with total public debt accounting for US$3,914.5 million, and total publicly guaranteed debt for the remaining US$2.4 million.
Notably, when compared to the end of 2022, when debt stood at US$3,654.9 million, a 7.2% increase was recorded. To this end, Government said this was mainly attributed to a positive net flow from both the external and domestic debt portfolios.
In the recently published report it was stated, “As a result of Government’s continued effort to ensure that financing needs are met at the lowest possible cost with a prudent degree of risk, Guyana’s public debt remains sustainable with a moderate risk of debt distress.”
On August 3, the National Assembly approved an increase to the country’s domestic public and external debt ceilings by some US$3 Billion, which allows the country to borrow more loans.
The country’s domestic public debt ceiling was increased to $750 billion, up from $500 billion, and a new external borrowing ceiling of $900 billion, after its last increase to $650 billion. The country’s previous debt ceilings were last increased by the Government back in January 2021.
According to the Ministry of Finance, given Guyana’s economic outlook, these revisions to the external and domestic public debt ceilings are consistent with the country’s long-term debt sustainability.
Notably, fuelled by a ramping up of oil production and the resurgence of the non-oil economy, the country registered real GDP growth of 62.3 percent in 2022, making it the fastest-growing economy in the world.
As such, it was noted that this appreciable growth performance and the country’s robust economic outlook underpin Guyana’s sustainable absorption of the new debt. In sum, the Government said it is committed to harnessing Guyana’s debt-carrying capacity to accelerate its development agenda.
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