Guyana is carrying an increasing share of its public debt in foreign currencies, increasing the Government’s exposure to exchange-rate movements and potentially raising the cost of servicing its obligations.
In its 2026 Mid-Year Report, the Ministry of Finance reported that foreign-currency debt accounted for 38.6 per cent of total public and publicly guaranteed (PPG) debt at the end of June 2026, up from 35.1 per cent a year earlier. Over the same period, the share of debt denominated in Guyanese dollars fell to 61.4 per cent.
The ministry identified foreign exchange and interest-rate movements as key risks to manage in the country’s debt portfolio.
President Dr Mohamed Irfaan Ali also highlighted foreign-currency demand at a recent news conference. The President said that commercial banks purchased US$2.279 billion in foreign currency between January and June 2026, compared with US$1.798 billion in the corresponding period of 2025, an increase of about 26.8 per cent.
Over the same period, foreign-currency injections from the Bank of Guyana rose from US$642 million to US$836 million.
President Ali said demand for foreign currency is expected to remain substantial in the final quarter of the year, with projected requirements of approximately US$385 million in October, US$400 million in November and US$436 million in December.
He said the Government intends to engage with commercial banks to understand better the sources of this demand, including foreign exchange requirements for major companies and profit repatriation by regional and multinational businesses.
US dollar accounts for the largest share of external debt
The Mid-Year Report indicates that Guyana’s external PPG debt stood at US$3.306 billion as at the end of June 2026.
The US dollar accounted for the largest share of that debt, at 69.8 per cent, compared with 58.5 per cent at the end of June 2025.
The euro accounted for 10.9 per cent of external debt, while the Chinese Renminbi accounted for 9.8 per cent. Special Drawing Rights made up 6.9 per cent, while the Canadian dollar, British pound, UAE dirham, and other currencies collectively accounted for the remaining 2.5 per cent.
The Ministry of Finance said that the high concentration of external obligations in US dollars creates an additional layer of currency risk. Guyana uses US dollars to obtain other currencies needed to meet its external debt commitments, meaning exchange-rate fluctuations can affect both debt-servicing expenses and the value of outstanding obligations when converted into Guyanese dollars.
The report also noted that fluctuations in the US dollar’s value against other currencies in Guyana’s external debt portfolio could affect the overall cost of servicing those obligations.
Measures to manage currency risk
According to the ministry, the Guyanese dollar has remained broadly stable against the US dollar, helping to limit the immediate impact of exchange-rate movements on debt servicing.
The government is nevertheless monitoring developments in international trade and movements in major global currencies as part of its debt-risk management strategy.
The report said authorities are also working to reduce foreign-exchange exposure by strengthening the domestic financial market and expanding the availability of local-currency debt instruments.
The Bank of Guyana is supporting these efforts through monetary and administrative measures intended to maintain exchange-rate stability and ensure that adequate foreign currency is available for external debt payments.
Interest-rate exposure remains a concern.
While Guyana’s foreign-currency exposure has increased, the Ministry of Finance said the country’s exposure to variable interest rates has declined slightly.
At the end of June 2026, 77.9 per cent of public debt carried fixed interest rates, while 22.1 per cent was subject to variable rates. The variable-rate component fell by 1.4 percentage points compared with the previous year.
The ministry attributed much of this improvement to issuing additional fixed-rate debt.
However, it cautioned that the fixed-rate figure does not fully reflect the Government’s exposure to fluctuations in borrowing costs.
More than half of the debt classified as fixed rate is scheduled to be repriced within the next year. This is largely due to maturing Treasury bills and other instruments whose rates are linked to Treasury-bill yields.
The entire domestic debt portfolio is subject to refixing within one year, compared with 37.6 per cent of the external debt portfolio.
The Ministry described this concentration in short-term instruments as the “T-bill effect”, which makes domestic borrowing costs more sensitive to interest-rate movements.
Guyana’s Average Time to Refixing (ATR) was three years at the end of June 2026. The domestic debt portfolio had an ATR of less than one year, whereas the external portfolio stood at approximately seven years.
The shorter maturity of domestic debt reflects the significant role of Treasury bills in Government borrowing.
Despite this vulnerability, Treasury-bill yields remained relatively stable over the preceding year, averaging around 1 per cent per annum across maturities.
The government said it will continue to manage external interest-rate risk by prioritising fixed-rate borrowing and, where economically appropriate, converting variable-rate obligations to fixed-rate instruments.
For domestic borrowing, the authorities are likewise placing greater emphasis on fixed-rate financing, while using fiscal measures to curb upward pressure on borrowing costs.