Blog Post

25 Jun
By: MOF Communications Unit 0

World Bank approves US$35m for oil sector preparations

The World Bank Group today announced approval of a US$35 million Development Policy Credit to support Guyana’s efforts to bolster financial sector development and fiscal management to better prepare the country to tap its newly discovered oil and gas reserves and transform its oil wealth into human capital.

The assistance of the World Bank in this area had been previously announced by the government here. The terms of the credit arrangement were not disclosed in today’s press release from the World Bank Group.

The released quoted Guyana’s Finance Minister Winston Jordan as saying “This financing provides critical support to our reform agenda and efforts to strengthen institutions and build a resilient economy that is capable of withstanding both external and domestic shocks. These reforms will be key to guide the management of oil revenues for the benefit of present and future generations”.

The release said that while currently nearly one in four people in Guyana live in poverty, experts project that the GDP will surge when commercial production of newly-discovered oil and gas begins.

“ Guyana is making important strides to promote financial resilience and improve fiscal management, and has embarked on a broad-based reform programme,” said Tahseen Sayed, World Bank’s Country Director for the Caribbean.

“These reforms will be key to build a strong economy that is underpinned by a strategic management of public resources for the benefit of the Guyanese people.”

The release said that the financing focuses on strengthening financial stability and enabling sound financial development to nurture macroeconomic stability and long-term growth. “In particular, it will support banking reforms and depositor protection, the establishment of a deposit insurance scheme, implementation of a new insurance law, and the country’s anti-money laundering efforts”, the release said.

It added that the Development Policy Credit is the first of two programmatic financial and fiscal development policy credits and is financed from the International Development Association.