WASHINGTON DC – The World Bank’s Chief Economist for Latin America and the Caribbean (LAC), William Maloney, has underscored the need for Guyana to ensure that its Natural Resource Fund (NRF) is well-managed and independent. Monies earned from oil sales and royalties from ExxonMobil Guyana Limited operation in the Stabroek Block is deposited into Guyana’s NRF (oil fund).

During a press conference, Maloney highlighted the country’s promising future due to its petroleum sector, but cautioned that managing these resources will present significant challenges.

Maloney pointed out that the primary concern will be to prevent overvaluation of the local currency and inflation, issues that could arise if oil revenues are not properly utilized. “Guyana clearly have a bright future in terms of revenues coming from petroleum and I think the challenge is going to be to use those revenues correctly in such a way that (they) don’t drive overvaluation of the currency and drive inflation in the country,” Maloney said.

He emphasized the importance of ensuring that these funds are used in ways that promote long-term economic stability. The World Bank official added: “That’s going to mean having a very well-run and independent sovereign wealth fund. I think that’s going to be a big challenge going forward.” Moreover, he also noted that the World Bank is working with Guyana to ensure that the country’s oil investments are environmentally sustainable. Recently, the Government of Guyana withdrew $62.3 billion from the oil fund, bringing its total withdrawal to date for the year to $239.176 billion.

 Kaieteur News had reported that concerns have been raised about the management of the NRF. Recently the Chairman of the National Assembly’s Public Accounts Committee, Jermaine Figueira called for transparency when using Guyana’s oil money. He even cited the need for possible amendments to the Act.  Section 16.2 of the Act states that: “All withdrawals from the Fund shall be deposited into the Consolidated Fund and shall be used only to finance: (a) national development priorities including any initiative aimed at realizing an inclusive green economy, and (b) essential projects that are directly related to ameliorating the effect of a major natural disaster.” (Kaieteur News)

Photo: Chief Economist of Latin America and Caribbean, William Maloney.