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Every man, woman and child will be shackled to $1.8 million debt by end of 2024
Kaieteur News – As Guyana continues to develop rapidly, an alarming financial burden looms over its citizens. By the end of 2024, every individual in Guyana is projected to be shackled to approximately GY$1.8 million of the nation’s escalating debt. This staggering figure emerges from an analysis of the country’s financial trajectory and population statistics.
In 2023, Guyana witnessed a 23% deepening in debt, with the country owing US$4.5 billion. Dr. Ashni Singh, the Senior Minister in the Office of the President with Responsibility for Finance and Public Service, disclosed this while presenting the 2024 Budget to the National Assembly. The end of 2023 saw Guyana’s total Public and Publicly Guaranteed (PPG) debt escalate to US$4,508.8 million, a substantial increase from US$3,654.9 million at the end of 2022. The country’s external debt stood at US$1,775.5 million at the end of 2023, marking a 13% rise from the previous year. Simultaneously, domestic debt reached US$2,733.4 million, primarily attributed to the Government’s issuance of new Treasury Bills.
Adding to this, the 2024 national budget, amounting to GY$1.146 trillion, is expected to be supported by debt to the tune of 40% – approximately GY$458 billion (US$2.2 billion). Calculations based on an exchange rate of GY$208.5 to US$1 reveal that this additional debt will substantially inflate the country’s total debt to approximately US$6.7 billion.
With Guyana’s mid-year population in 2023 recorded at approximately 778,400, the per capita share of this debt is a daunting GY$1,794,257.45 (approximately US$8,605.55). This figure represents each citizen’s average share of the national debt by the end of 2024.
Notably, these calculations do not take into account the debt servicing planned by the government for 2024. Debt servicing, a significant factor in national budgets, includes repayments of both principal and interest on existing debts. In 2023, Guyana allocated US$177.3 million for debt service, a considerable increase from US$150.2 million in 2022. This increase was driven by payments for both domestic and external debts. However, such a debt service only amounted to wiping about US$227 of each citizen’s debt.
While Dr. Singh boasts of Guyana’s low Gross Domestic Product (GDP) to debt ratio and prudent debt management, the per capita debt figure presents a stark contrast. Guyana continues to take on more debt annually than the rate at which it is servicing. The Minister said the government is committed to strong debt sustainability, focusing on policies and practices that prioritize development financing at the lowest cost within prudent risk parameters. He also highlighted Guyana’s total PPG debt-to-GDP ratio of 27% at the end of 2023, lauding it as one of the lowest in the Caribbean Region.
However, the burden of debt per individual paints a challenging picture for citizens. Vice President Dr. Bharrat Jagdeo said that Guyana will have so much money coming from oil in the next few years that it would be able to clear its entire debt completely with just one year of revenues.
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