The International Monetary Fund (IMF) has advised the Government of Guyana to be prudent in any attempt to increase public investment.
This recommendation was made in a November 2017 report that the IMF handed to the government. The report details the findings of an IMF team that perused the PSA Guyana signed with ExxonMobil in 2016. The same team also evaluated government’s preparation for first oil and the government’s intentions for the handling of oil revenues.
The team noted government’s stated policy intention to use part of the oil revenue to scale up investment. IMF said that given this intention, government needs to strengthen public investment management capacity. “This includes project appraisal and selection, implementation, procurement, and monitoring and evaluation.”
IMF said too that there is also a need to identify constraints, whether in the private or public sector, that will limit the ability to effectively implement public investment projects.
Further, the mission noted, “Indeed, concerns about absorption capacity suggest that any scaling-up of public investment should only be done in a gradual manner.”