A Pivotal Moment for Guyana : Realizing the Opportunities
Guyana stands at the threshold of a new era. The recent discovery of vast offshore oil and gas (O&G) reserves and the start of production, is poised to fundamentally transform the structure of the Guyanese economy while generating an influx of...
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| Format: | Report |
| Language: | English |
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World Bank, Washington, DC
2021
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| Online Access: | http://documents.worldbank.org/curated/en/691761607528494981/A-Pivotal-Moment-for-Guyana-Realizing-the-Opportunities-Systematic-Country-Diagnostic http://hdl.handle.net/10986/34969 |
| Summary: | Guyana stands at the threshold of a new
era. The recent discovery of vast offshore oil and gas
(O&G) reserves and the start of production, is poised to
fundamentally transform the structure of the Guyanese
economy while generating an influx of fiscal revenue. Prior
to the discovery, extractive industries and commodity
exports already played a major role in Guyana’s economy and
public finances. However, the mining sector created few jobs
and had a limited impact on poverty reduction. The rise of
the O&G sector poses unprecedented macro-fiscal
management challenges while offering new opportunities to
address longstanding development constraints. The
development of oil-producing countries often comes at high
cost of environment and climate change, which needs to be
balanced. In addition, the country is now facing the
challenges from the COVID-19 pandemic that will stretch the
public health systems and highlight inadequacies of testing
and treatment facilities. The SCD is organized into six
chapters. Chapter 1 situates the development of the oil
sector within Guyana’s broader economic, social, and
political context. Chapter 2 estimates the magnitude of
fiscal revenues from the oil sector, along with alternative
cost scenarios, and the implications of alternative
strategies for allocating these revenues and considers how
policies can mitigate the macro-fiscal and environmental
risks posed by the sector. Chapter 3 focuses on
institutional quality and good governance, especially in
terms of strengthening the public sector, and it details
challenges related to the design and implementation of a
sovereign wealth fund, which the international experience
has shown to be vital to the success of resource-rich
developing countries. Chapter 4 explores how the government
can leverage natural resource revenues to accelerate
Guyana’s economic transformation and spur job creation.
Chapter 5 evaluates strategies for transforming Guyana’s
natural capital into human capital and reaching full
coverage of basic services and infrastructure through
investment in health, education, and social protection. The
chapter highlights the constraints in human capital
development and health facilities; even more critical that
these are addressed in context of the current COVID-19
pandemic. Chapter 6 prioritizes interventions necessary to
generate enduring gains in poverty reduction and shared
prosperity. A key offering of the chapter is a spatial
development package to address deficiencies in basic service
delivery and infrastructure necessary to protect well-being
and health of Guyanese citizens. To ground the analysis in
the real-world experience of Guyanese communities, each
chapter begins with a brief discussion of how the newfound
wealth will affect the most vulnerable and marginalized households. |
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