Guyana’s growth surges amid regional slowdown

Guyana is set to outpace Latin America and the Caribbean with an impressive 10.3 per cent economic expansion in 2025, following a 43.6 per cent surge in 2024. This robust growth contrasts sharply with the broader region’s modest forecast of 2.2 per cent growth in 2025, as many countries face weak external demand, tight financial conditions and domestic challenges, according to the latest United Nations Economic Commission for Latin America and the Caribbean (ECLAC) report.

Growth in Guyana is expected to moderate to 23.0 per cent in 2026, driven by the country’s booming oil sector and sustained investment in infrastructure and related industries.

The wider region is projected to expand 2.3 per cent in 2026 amid ongoing global uncertainty and structural constraints. South America is forecast to grow 2.7 per cent in 2025 and 2.4 per cent in 2026, while Central America and Mexico face slower growth of 1.0 per cent and 1.7 per cent respectively, affected by a slowdown in the United States. The Caribbean, excluding Guyana, is expected to grow 1.8 per cent in 2025 and 1.7 per cent in 2026, influenced by fluctuations in tourism, high logistics costs and climate vulnerabilities.

ECLAC warned that global risks persist, including slower growth in major economies, rising protectionism, geopolitical tensions and commodity price volatility, which may increase inflationary pressures and restrict macroeconomic policy responses.

The region is expected to record a current account deficit of 1.1 per cent of GDP in 2025, with persistent dependence on foreign investment and external debt limiting adjustment options. Domestic demand is forecast to remain sluggish, with private consumption slowing due to weaker labour income and falling confidence, while investment remains subdued at approximately 18.5 per cent of GDP.

Employment growth is projected to slow, with rates of 1.5 per cent in 2025 and 1.2 per cent in 2026. Unemployment is expected to remain steady at 5.6 per cent, and labour informality should continue to decline as formal sector jobs grow. Labour market participation, particularly among women, is anticipated to improve gradually, boosting equity despite ongoing gender gaps.

Inflation is forecast to stabilise near 3 per cent in 2025 and 2026, close to target levels, although risks remain from potential spikes in international food and energy prices and renewed geopolitical tensions.