4 weeks ago
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Guyana President Irfaan Ali is warning that the ongoing war in the Middle East, particularly escalating tensions affecting the Strait of Hormuz, could have far-reaching consequences for the global economy, including Guyana.
Addressing the 136th General Meeting of the Georgetown Chamber of Commerce and Industry (GCCI), Ali said disruptions to the critical energy corridor are already impacting global markets and could worsen in the months ahead. He added that he supports international calls for dialogue and peaceful engagement to stabilise the situation.
“I also want to join with President Trump in the United States in calling on all parties in the Gulf to move towards dialogue and to have constructive conversations in normalising the situation in the Gulf that is affecting all of us,” Ali said.
The United States and Israel launched an attack against Iran on February 28, targeting missile infrastructure, military sites and leadership in the capital, Tehran, and across the country. Iran’s Supreme Leader, Ali Khamenei, who had led the country since 1989, was killed during the first wave of strikes.
In response, Iran has directly targeted locations linked to U.S. forces and has increasingly struck energy and maritime infrastructure across the Gulf. Iranian actions near the Strait of Hormuz, including threats to shipping and reported attacks, have reduced tanker traffic and heightened concerns about global energy supply disruptions.
Ali noted that the Strait of Hormuz is among the most strategically important shipping routes globally, carrying roughly 20 to 25 per cent of seaborne oil trade, along with significant volumes of natural gas.
He said disruptions in the region are already affecting global markets, pointing out that 17 per cent of Qatar’s liquefied natural gas (LNG) capacity has been impacted in recent days.
The situation has also driven up costs across several sectors, including a 25 per cent increase in fertiliser prices, which could have direct implications for agriculture and global food production.
“These are the important ingredients for manufacturing, industrial development and most economies around the world,” Ali told the business community, warning that even if hostilities were to cease immediately, the damage to energy infrastructure could take years to repair.
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“So already this is not a short-term situation. Even if the war stops tomorrow, you already have on our hands five years of challenge,” he said, citing rising freight and transport costs, along with increased shipping and insurance rates due to heightened regional risks.
Ali stressed that maintaining open trade routes through the Strait of Hormuz is critical to global economic stability.
“That is why we support every effort to have the Strait of Hormuz open and functional and every effort in bringing the war to an end,” he said, adding that the government is closely monitoring developments and stands ready to make policy adjustments to safeguard the economy.
The president also used the forum to renew calls for the establishment of an oil refinery in Guyana, describing it as a national security priority amid growing global energy uncertainty.
“Now, I believe we should return to the conversation of a refinery for national security,” Ali said, noting that despite Guyana’s emergence as an oil-producing nation, it remains heavily dependent on imported fuel, particularly for electricity generation.
He said the fuel bill for Guyana Power and Light Inc. remains significant and could increase further with global price shocks. Investing in refining capacity, he argued, would give the country greater control over fuel supply, pricing and long-term energy security.
Ali also pointed to broader efforts to expand national energy infrastructure, including the gas-to-energy project, which is expected to reduce reliance on imports and lower electricity costs over time.
He emphasised that closer collaboration between government and the private sector will be key to navigating global uncertainty while sustaining Guyana’s economic growth.
“We are closely monitoring the situation. We are vigilant, we are responsible, and we stand ready to make the necessary adjustments,” he said.
English (US) ·