Dear Editor,
The recent budget presentations offered a valuable opportunity to assess Guyana’s fiscal trajectory and economic management.
An examination of the Central Government Financial Operations, as referenced in the National Budgets from 2020-2026, reveals several data points and trends that warrant careful, non-partisan analysis because they reflect a state of strategic financial decay.
The central concern, widely acknowledged in economic literature, is to reflect on how dependent is the recurrent expenditure (the fixed cost) on these finite petroleum revenues (which are variable). The data indicates a growing negative net funding gap for recurring expenditures prior to the inclusion of oil revenues (see table below).
Over the past five years, the deficit associated with financing fixed current expenditures has expanded markedly, deteriorating approximately sixfold between 2020 and 2025, from about NEGATIVE $19 billion to NEGATIVE $145 billion. This Ashni Singh 2026 Budget plans to push the country further under the water. In cumulative terms, the evidence suggests that the non-oil tradable and productive sectors generated an estimated $268 billion less in revenue than required to meet the state’s fixed operational obligations since President Ali assumed office in 2020.
This persistent gap points to a structural fiscal imbalance rather than a temporary cyclical shortfall. Despite its clear implications for fiscal sustainability, this imbalance has not been explicitly articulated or interrogated within the national budget framework by the Leader of the Opposition and his Team and they must do better next year in the debates.
The scale and duration of the shortfall should have triggered heightened fiscal scrutiny from the opposition rather than statements on victimhood, forward-looking risk assessment to expose how the PPP is destroying the future of Guyana, and corrective policy recommendations so that the people can build confidence in them as the government in waiting.
From a fiscal sustainability perspective, continued reliance on borrowing to finance fixed recurrent expenditures is inherently problematic. While short-term borrowing can smooth temporary shocks, persistent borrowing to cover fixed operating costs erodes the fiscal credibility of the PPP government and constrains future policy space for the next government in 2030. This is the time for the WIN Party to push to tell the Guyanese people why they will be the better force tomorrow. What the PPP has done over the last five years has increased vulnerability in this nation to financing shocks and they have undermined the country’s medium-term macroeconomic stability. RED FLAG moment!
On the capital expenditure side, even this is being mismanaged by the PPP. The use of oil revenues to finance capital expenditure—particularly asset-creating infrastructure projects—can be justified within a sound development framework when those investments enhance productivity and long-term growth. But when we are spending G$1.1 trillion more than the oil money drawdown to spend on capital projects like the Heroes Highway and Schoonord Highway which have to be rebuilt after three years, then we are wasting money. When Burnham built the Linden Highway, it lasted 50 years and it cost far less than the Heroes highway to build. There is more than enough evidence to show many senior government functionaries cannot justify the growth in their personal wealth, which is occurring geometrically. There is a lot of corruption under this Irfaan Ali Presidency but he seems incapable to arresting it.
Over the past five years, the state has borrowed approximately G$1.3 trillion through foreign and domestic debt markets, on top of the withdrawals of roughly G$1.1 trillion from the Natural Resource Fund (NRF), largely to support operational expenditures. This financing pattern provides strong evidence of a significant structural imbalance in the fiscal accounts and highlights a growing vulnerability in Guyana’s public finances. I am shocked at how poorly Dr. Ashni Singh is managing this economy with all his experience and qualifications.
This structural gap creates inherent exposure to external shocks. Global oil prices are subject to considerable volatility arising from the current geopolitical developments, technological change, and shifting global demand. A prudent fiscal strategy therefore requires the accumulation of buffers, disciplined expenditure management, and accelerated diversification of the revenue base to insulate essential public services and the living standards of our people from these external risks. Not walk around with the mentality of “wait until you have to go to the toilet to build the pit latrine”?
The substantial drawdowns from the NRF to bridge recurrent financing gaps underscore the need for a clearly defined, legislated medium-term fiscal framework. Such a framework should command broad political and societal consensus, more transparent fiscal rules, and alignment in the use of resource in conformity with clearly established long-term development objectives. Without this sort of institutional discipline, the effectiveness of fiscal policies and public confidence in the management of the economic will continue to erode. The young people of Guyana are not stupid; they are still lining up in droves at the US Embassy for their exit ticket. In their minds, it is better to battle in Trump-land than sink with Irfaan Ali.
A nationally adopted development strategy—anchored in strong institutions, fiscal transparency, and accountability—would enhance credibility, encourage greater private investment, and support the creation of intergenerational wealth for a greater cross section of our people. The fiscal data presented in the most recent budget suggest that these objectives remain insufficiently addressed.
In parallel, the widening financing gap for capital projects, while reflecting an ambitious public investment agenda, necessitates rigorous project appraisals, reasoned cost-benefit analysis studies, and a properly prioritization of the capital project pipeline. This nation misses dearly a man called Clyde Roopchand and the State Planning Secretariat, because this is what he did in the hard days and did it very good. Every nation needs such a national planning body and Guyana does not have one.
Over the past five years, the deficit associated with expenditures on capital projects has expanded markedly, deteriorating approximately sevenfold—from about –$82 billion to –$706 billion and it is not even fully covered by oil money. The outcome is – more borrowing. It is only a matter of time before this “impending financial crisis “ arrives at every Guyanese’s doorstep.
The macroeconomic consequences of financing these large and persistent deficits are well established in the economic literature. These include inflationary pressures, foreign exchange constraints, and rising public debt levels (all three of which are present in current day Guyana). Transparent monitoring and disclosure of key indicators—such as inflation dynamics, real effective exchange rate movements, domestic liquidity conditions, and debt-to-GDP ratios—are therefore essential but the PPP continue to not fully disclose these information. What do they have to hide with the people’s money?
Absent timely adjustment, the eventual correction—when oil revenues weaken or fiscal buffers are exhausted—would likely require difficult structural and fiscal measures that can return us to the bad old days of Empty Rice Pots and the ERP. International experience shows that such adjustments disproportionately affect lower-income households, thus reinforcing the urgency of addressing these vulnerabilities now rather than in 2030, while policy options still remain available.
In conclusion, Guyana stands at a unique juncture of unprecedented opportunity. The core economic challenge is one of strategic transformation: converting finite petroleum wealth into sustainable and high value human capital, resilient infrastructure that can last decades, and a competitive, diversified non-oil economy (which is not growing fast enough).