IMF says Guyana's low-carbon strategy is strengthening climate resilience and cleaner energy transition

The International Monetary Fund (IMF) has praised Guyana’s Low Carbon Development Strategy (LCDS) 2030, saying the country is leading the way in market-based forest conservation. The statement comes as Guyana is successfully using its vast forests to generate hundreds of millions of U.S. dollars for national development. In its 2026 Article IV Mission concluding statement, the IMF said Guyana “remains at the forefront of market-based forest conservation” while advancing its transition to a cleaner and more cost-effective energy mix. The Fund also welcomed the government’s commitment to strengthening resilience to climate-related risks and protecting biodiversity. “Efforts to bolster resilience to natural disasters are advancing through investments in sea defences and drainage infrastructure alongside investments in more climate-resilient agriculture,” the IMF said. The comments reinforce the goals of the LCDS 2030, Guyana’s flagship environmental strategy that seeks to protect the country’s 18.5 million hectares of forests while using their global climate value to finance sustainable development. The strategy has become a significant new source of foreign exchange for Guyana through the sale of internationally certified forest carbon credits. The largest agreement came in 2022 when Guyana signed a landmark deal with Hess Corporation to sell 37.5 million jurisdictional forest carbon credits over a 10-year period for at least US$750 million. The agreement was the first of its kind under the ART-TREES global carbon standard and allows Guyana to retain about 70% of its eligible carbon credits for future sales as international demand grows. Since then, Guyana has diversified its carbon markets. Government figures show the country has earned approximately US$353 million from carbon credit sales since 2022. One of the newest revenue streams comes from the international aviation industry. In 2024, Guyana became the first country in the world to issue forest carbon credits approved for use under the United Nations’ Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), enabling airlines to purchase Guyana’s credits to meet international emissions obligations. Government officials have since disclosed that Guyana sold CORSIA-approved carbon credits to 19 international airlines over an 18-month period. Those transactions were reportedly completed at prices above the minimum price guaranteed under the Hess agreement, reflecting strong international demand for Guyana’s high-integrity forest credits. Guyana’s current success in carbon markets builds on an earlier forest conservation partnership with Norway, which provided about US$230 million in results-based payments between 2009 and 2015 for maintaining one of the world’s lowest deforestation rates. That agreement helped lay the foundation for the LCDS and Guyana’s emergence as a global leader in forest-based climate finance. Revenue generated through the LCDS is being invested in projects aimed at improving both environmental sustainability and the quality of life of Guyanese. These include renewable energy, sea and river defence works, drainage and irrigation systems, climate-resilient agriculture, biodiversity conservation and Indigenous land titling. The strategy also directs at least 15% of all carbon credit revenues to Indigenous and hinterland communities, allowing villages to finance projects identified in their own Village Sustainability Plans. Hundreds of communities have already benefited through investments in infrastructure, agriculture, transport, eco-tourism, small businesses and other local development initiatives. The IMF said Guyana’s broader climate agenda is also supporting the country’s transition to a cleaner and more affordable energy system while strengthening its resilience to increasingly frequent climate-related disasters. The Article IV Mission noted that investments in sea defences, drainage infrastructure and climate-resilient agriculture are helping the country adapt to rising climate risks while protecting biodiversity. The IMF’s endorsement comes as Guyana continues to experience one of the world’s fastest-growing economies, with the government seeking to ensure that rapid economic expansion is matched by investments that protect the country’s natural environment and support long-term sustainable development. The staff statement forms part of the IMF’s annual Article IV consultation, during which the institution assesses the country’s economic performance and policy direction. The IMF’s Executive Board is expected to consider the mission’s findings at a later date.