Country Report Guyana
- ID: 2138721
- July 2015
- Region: Guyana
- 28 Pages
- The Economist Intelligence Unit
The UN Economic Commission for Latin America and the Caribbean (ECLAC) has laid out a debt relief plan for small Caribbean countries that are members of the Caribbean Community (Caricom, a regional trade bloc), many of which have among the world's highest ratios of debt to GDP. The plan's main elements include a gradual write-off of total multilateral external debt and the establishment of a new Caribbean Resilience Fund (CRF) to help the countries to combat natural disasters better and to boost social development.
Across 15 countries and territories in the Caribbean, the total debt burden in 2013 was US$46bn, equivalent to 71% of regional GDP. In terms of their public debt/GDP ratios, Antigua and Barbuda, Barbados, Grenada, Jamaica and St Kitts and Nevis are among the world's 20 most heavily indebted countries. In the case of Antigua and Barbuda, Grenada, Jamaica, and St Kitts and Nevis, debt exceeds 100% of GDP, while it reaches very high levels (between 70% and 90% of GDP) in countries such as Barbados, Belize, Dominica, and Saint Lucia. However, on the other end of the spectrum, countries such as Trinidad and Tobago, Suriname, Anguilla and Montserrat display more sustainable levels of debt to GDP (all roughly below 40%).
ECLAC emphasises that debt in the Caribbean has risen mainly because of external shocks, combined with the inherent weaknesses of small island developing states (SIDS), and not because of bad policies or fiscal indiscipline. As most Caribbean countries are classified officially as middle-income countries, they have limited access to concessional external finance. Given the rise in sovereign risk premiums since the global financial crisis, this is a significant disadvantage.