Guyana has long been an anomaly. South America’s only English-speaking republic, it’s also the continent’s emptiest country—with only 800,000 people inhabiting an area the size of England.
But now, as recent massive discoveries of offshore oil come onstream, long-impoverished Guyana has a new claim to fame. This year its GDP will expand by an astounding 57%, making it the world’s fastest-growing economy. Crude oil exports alone will generate $1 billion, according to Gobind Ganga, governor of Guyana’s Central Bank.
“This is historically the largest amount of revenue we will earn from any single sector this year. This is very obvious with the price of oil today,” Ganga told AP last month.
Representing Guyana here is Ambassador Sam Hinds. At 78, he’s one of the oldest envoys on Embassy Row. Yet in a recent interview with the Washington Diplomat, Hinds said he never expected to end up as ambassador—especially after serving as both president and prime minister of his little-known country.
“My father was a cooper who made barrels for the rum distilleries,” said Hinds, who was born in the village of Alexander, just outside Georgetown, Guyana’s capital. “In 1955, I won a scholarship to Queen’s College, and then went to study chemical engineering in New Brunswick [Canada]. I graduated, returned to Guyana and worked in the bauxite industry from 1967 to 1992, when I lost my way and ended up in politics.”
That was the year Hinds became prime minister, which also gave him direct responsibility for electricity and energy as well as mining and telecommunications. He also served briefly as president after the March 1997 death of longtime President Cheddi Jagan of the once-Marxist People’s Progressive Party (PPP), and until the election nine months later of Jagan’s widow, Janet Rosenberg Jagan, as Guyana’s president.
“My retirement had been announced before the elections of mid-2015, which unfortunately we lost,” he said. “But after the PPP was declared the winner of the 2020 elections, the president [Irfaan Ali] indicated to me that I was under consideration for a posting to Washington.”
Avoiding the curse of easy oil money
Guyana, formerly British Guiana, achieved independence in 1966. Often confused with nearby French Guiana and the African nations of Ghana, French-speaking Guinea, Spanish-speaking Equatorial Guinea and Portuguese-speaking Guinea-Bissau, it has long been a backwater known mainly for Jonestown—the site where in 1978 more than 900 people died in a mass suicide orchestrated by cult leader Jim Jones.
More than four decades later, Guyana has now become synonymous with sudden oil wealth. It’s estimated that over 11 billion barrels of recoverable oil resources have been discovered in the 6.6 million-acre offshore Stabroek block. The big winner here is operator ExxonMobil, which owns 45% of the block, as well as Hess Oil, which owns 30% and China National Offshore Oil Co., which owns 25%.
Guyana also hosts the secretariat of the 15-member Caribbean Community (Caricom), a regional grouping of mostly smaller English-speaking island states and territories that also includes Belize in Central America, French- and Creole-speaking Haiti, and Dutch-speaking Suriname.
For about six years, exploration was held up due to Guyana’s border disputes with both Venezuela to the west, and with Suriname to the east. With regard to the latter, eventually the International Court of Justice (ICJ) awarded 70% of the disputed offshore blocks to Guyana and 30% to Suriname.
“That at least gave the basis for exploration to go forward, and now both Guyana and Suriname are benefitting,” he said. “There’s been no production yet on the Surinamese side, but I presume that will follow soon enough.”
Current production is about 350,000 barrels a day, but this will more than double once two other oil fields come on stream in the next three years, according to Exxon.
With Russia’s war on Ukraine pushing up the price of crude, and its recent agreement with OPEC to slash petroleum output by 2 million barrels a day, analysts predict oil will remain above $100 a barrel through next year. While that’s not as high as previous predictions of $125 a barrel for 2023, it still represents a potential bonanza for Guyana as production ramps up.
Border dispute with Venezuela drags on
Yet will this newfound oil wealth filter down to average Guyanese? The examples of Nigeria, Libya, Angola, Equatorial Guinea and even neighboring Venezuela don’t exactly inspire hope.
“The track record for poor countries is not very good, and Guyana is a poor country,” Hinds conceded. “But we in the PPP have always put the focus on our development programs, which is expressed in our budget. We are putting large portions of our budget into health and education.”
Hinds, who replaced Riyad Insanally as Guyana’s man in Washington in July 2021, said the entire country is hopeful that its oil bonanza will finally lift the Guyanese people out of poverty.
“At present trends, production in Guyana will get up to 1 million barrels a day by 2027. Right now, we’re probably hitting 340,000 barrels a day, and our current consumption is relatively small,” he said.
“Per-capita GDP could be doubled in five years, from $6,000 to $12,000,” Hinds added. “Many hotels are already going up, lots of investors coming in, tourism could grow. My hope is that we will avoid the extremes of income inequality which contribute to frustration and bitterness, and rising crime.”
Meanwhile, Guyana’s border dispute with Venezuela—which dates back to an 1899 arbitration ruling—continues to drag on. Venezuela’s late populist president Hugo Chávez often cited his country’s claim to 80% of Guyanese territory, a demand repeated by his handpicked successor, Nicolás Maduro.
Regional support for Venezuela’s Guaidó tumbles
Either of those men are preferable to Juan Guaidó, the opposition politician officially recognized as Venezuela’s president by the US government since 2019, when Guaidó—then head of Venezuela’s National Assembly—challenged Maduro’s claim to the presidency following his victory in an election widely dismissed by international observers as fraudulent.
Since then, regional support for Guaidó has dwindled substantially. Last week, 19 members of the Organization of American States backed a proposal to strip recognition of Gustavo Tarre, Guaidó’s permanent representative to the OAS, on the grounds that Guaidó is not a head of state.
Hinds says he isn’t happy at all with the US-backed Guaidó, whose envoy won support at the OAS only from four countries: Canada, Guatemala, Paraguay and the United States. The remaining OAS member states abstained.
“Juan Guaidó used to make a point about going onto a disputed island in the Kuyuni River. He made a few trips there and said we [Venezuela] should take over the Essequibo the same way Putin took over Ukraine,” Hinds said. “For us, Guaidó is no better than Maduro. In fact, he’s probably worse than Maduro.”
The ambassador added: “This is a complicated situation. The Americans have been assuring us that Guyana’s interests will not be sacrificed in their evolving relationship with Venezuela.”
On Oct. 5, the Guyanese government marked the 123rd anniversary of the Anglo-Venezuelan Arbitral Tribunal, saying it hopes justice will prevail.
“Guyana is optimistic that the ICJ will decide the case in its favor and that the validity of the arbitral award, and the border, will be upheld,” Guyana’s Ministry of Foreign Affairs and International Cooperation said in a statement. “In the meantime, it is dedicating all of its efforts to the achievement of this outcome.”