Gov’t to add $5.9M in debt to every household by the end of 2025- Shadow Finance Minister

Jan 25, 2025 News

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…highlights 36% growth in non-oil economy between 2020 and 2024 while debt grew by 253%

By: Davina Bagot

Kaieteur News-With the People’s Progressive Party (PPP) administration increasing Guyana’s debt from US$1.698 billion in 2019 to US$7.637 billion, as projected in this year’s Budget, each household will have a debt of $5.9M over their heads, incurred by the government over a five-year period.

This was pointed out by Shadow Finance Minister, Juretha Fernandes on Friday, during her contribution to this year’s Budget Debate in the National Assembly.

Tasked with commencing the five-day debate in Parliament, being convened at the Arthur Chung Conference Centre, Liliendaal, East Coast Demerara, the Alliance For Change (AFC) Member of Parliament (MP) shared comprehensive views on government policies and the performance of the economy between 2020 and 2024. She compared the PPP’s tenure to the Coalition’s five years in office, between the period 2015 to 2020.

Focusing heavily on the government’s debt policy, the Opposition Parliamentarian argued that the increasing debt is being used to further enrich the wealthy while, leaving the poor to help pay the bill.

She said, “Over this term of government mismanagement, the PPP has increased Guyana’s public debt from US$1.698 billion in 2019 to US$7.637 billion projected for 2025, an increase of US$5.939 billion or GYD$1.24 trillion.”

For greater clarity to Guyanese, the shadow Finance Minister reasoned, “From 2020 to 2025 the PPP added a debt burden of GYD$5.9 million to every household in Guyana- $5.9 million is no small amount to the struggling families who are barely surviving paycheck to paycheck; $5.9 million should have been used to take people from below the poverty line and providing them with a decent standard of living. But instead, the increasing debt is being used to further enrich the wealthy while leaving the poor to help pay the bill.”

She told the House that while 57% of Guyana’s population cannot afford anything beyond the most basic essentials of life, government has saddled those very individuals, struggling to survive in poverty, with $5.9 million debt per household. Fernandes told this newspaper, that she used the information in the most recent census, completed in 2012, which states 210,000 households were recorded.

GDP and Debt

Turning her attention to the country’s Gross Domestic Product (GDP) and its climbing debt, the MP noted that Finance Minister, Dr. Ashni Singh presented a comparison of debt-to-GDP, using non-oil GDP during the coalition’s tenure and compared it to oil included GDP under the current administration. Referring to this as “disingenuous” Fernandes requested the House for indulgence on a comparison of Guyana’s debt-to-nonoil GDP.

She explained, “Mr. Speaker, examining non-oil GDP is crucial for prudent economic management because it provides a more accurate picture of a country’s economic diversification and long-term sustainability, especially for oil-rich nations like Guyana, as it excludes the volatile fluctuations in oil prices which can significantly skew overall GDP figures, giving a false impression of economic health when heavily relying on oil related activities.”

According to Fernandes, using the non-oil GDP indicates the strength of the economy beyond the petroleum sector and highlights the development of other industries, signifying a more resilient economic base.

To this end, she pointed out, “From 2020 to 2024 the non-oil economy of Guyana grew 36% in total. In that same period the stock of public debt grew by a staggering 253%.”

The Shadow Finance Minister said this relates to a 7% growth in debt for every 1% growth in the economy.

Fernandes continued, “To put this into context, in the period 2015 to 2019 Guyana’s GDP grew by 19%. In that same period total public debt grew by a tiny 14%. For every 1% growth in GDP the coalition increased debt by just 0.7%. Not even a full percent.”

The Opposition MP explained that government has increased the national debt by a massive 18 times as much as the coalition government; spent $2.1 trillion more than the coalition did but only delivered 17% more growth than the coalition did.

She concluded that when the PPP is audited on their management of debt to GDP, it is clear that it has drastically increased the debt burden while failing to achieve economic growth above the coalition non-oil tenure.

To this end, Fernandes told the National Assembly, “We are living in a country with a budget of $1.382 trillion in 2025, this country is not void of financial resources this country is void of competent leadership. This country is void of a government that prioritises its people over its private business ventures. We are living in a country in which the government operates against its own people, as Economic Gangsters.”

This year, government has indicated that $350B in loans will be used to finance the $1.382 trillion Budget.

(Gov’t to add $5.9M in debt to every household by the end of 2025- Shadow Finance Minister)

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• budget, Debt, Fernandes, GDP, household

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