By Antonio Dey | HGP Nightly News

Former Auditor General Warns Guyana at Risk of Serious Financial Trouble Amid Rising National Debt

Georgetown, Guyana – Former Auditor General Anand Goolsarran is sounding the alarm over Guyana’s increasing national debt, warning that the government’s borrowing habits could have devastating long-term consequences, particularly if oil revenues fall unexpectedly.

In a recent interview with HGP Nightly News, Goolsarran expressed deep concern that Guyana’s burgeoning debt — fueled by multiple international loan agreements, including major arrangements with the United States and China — could cripple the economy if oil production is disrupted.

“I am kind of worried that we are going overboard in terms of incurring debt, borrowing money through borrowing,” Goolsarran stated, cautioning that over US$5 billion in debt could become unmanageable if oil revenues dip or a natural disaster interrupts production.

Transparency Issues in Oil and Gas Sector

Adding to the concern is the lack of transparency in the oil and gas industry, which Goolsarran directly attributed to the current administration. He criticized the government’s handling of the new Production Sharing Agreement (PSA) signed with ExxonMobil Guyana Limited.

Under the new PSA:

• The royalty rate has increased to 10%, up from 2% under the earlier Stabroek Block PSA.
• The cost recovery limit dropped from 75% to 65%, meaning contractors now recover a smaller portion of their investments before profits are split.
• A new corporate tax of 10% was introduced where previously no corporate tax applied.

Despite these adjustments, Goolsarran argued that from a financial standpoint, Guyana gains very little once tax offsets and other incentives are factored in.

“When you convert that into dollar value against the taxes we are paying for Exxon, we are left with very little,” he explained.

The Ministry of Finance has repeatedly defended its borrowing strategies, insisting that the loans are necessary for national development. However, financial experts like Christopher Ram have also criticized the government for significantly increasing domestic and external debt ceilings and ramping up withdrawals from the Natural Resource Fund (NRF).

Goolsarran was blunt in his assessment of the administration’s fiscal stewardship:

“I would give the government a failing grade on management of the economy.”

As Guyana positions itself as a major player in the global oil and gas industry, concerns about debt sustainability, economic transparency, and fiscal responsibility are increasingly taking center stage.