By Arthur Deakin
Historically, countries that discover large amounts of natural resources, such as oil or gold, tend to create a Sovereign Wealth Fund to manage their newfound wealth. Guyana, which recently discovered nine billion barrels of proven oil reserves, is following that same path. The structure of this new fund, known locally as the Natural Resources Fund (NRF), will fundamentally impact how effectively the country spends and saves its oil monies.
At the end of May, at the 2021 Diaspora Conference, President Irfaan Ali and Vice President Bharrat Jagdeo suggested that Guyana’s NRF would be similar to the Kazakhstan model in the coming years. Due to Guyana’s low development levels, they explained that the famed Norwegian SWF model did not fit the country’s current needs. Oil-rich Kazakhstan ranks 94 out of 190 in Transparency International’s corruption index, tied with countries such as Brazil, Ethiopia and Suriname.
