Ukraine war affecting local economy but Guyana’s food security not impacted – IMF

The Russian invasion of Ukraine contributed to rising food prices which adversely impacted Guyana’s economy, but even so, the International Monetary Fund (IMF) believes that Guyana’s food security efforts will not be impacted.

Based on a new report published after special consultation with the local authorities, the IMF acknowledged that the rising cost of goods has been affecting consumers globally.

These increased costs stem from supply chain disruptions and the increased demand for goods. And it was previously reported that this crisis was contributing to an increased cost of living locally, with food and fuel prices among the worrisome increases.

But the IMF noted that Guyanese authorities have taken measures to ease cost-of-living pressures for the population. These include cash transfers (such as cash grants) and key tax relief measures.

Aside from the global economic impact, the IMF pointed out that countries’ food security has been challenged. In Guyana, however, that is not necessarily the case.

“The impact of losing the limited trade connections with Ukraine and Russia could be absorbed by higher oil and food exports elsewhere, as agricultural production is recovering well,” the IMF noted.

Imports from Ukraine and Russia contain limited quantities of milk products and as such, the Fund advanced that the war is not expected to affect food security in Guyana.

Guyana’s food security efforts have been bolstered over the past two years, with the country now leading the charge to increase intra-regional trade and remove key trade barriers within the Caribbean Community  (CARICOM).

On the upside, the report noted that the increase in oil production offshore could be attributed to the crisis and the greater global demand for fuel.

“… higher global oil prices and additional gas and oil discoveries could significantly improve Guyana’s long-term economic prospects,” the IMF stated.