diff --git a/releasenotes/notes/fix-postgress-create-database-75fbe03e3b4e296d.yaml b/releasenotes/notes/fix-postgress-create-database-75fbe03e3b4e296d.yaml
new file mode 100644
index 0000000000..96a227cbe7
--- /dev/null
+++ b/releasenotes/notes/fix-postgress-create-database-75fbe03e3b4e296d.yaml
@@ -0,0 +1,8 @@
+---
+fixes:
+  - |
+    Fix guest-agent failed to start postgres container due to execution
+    of the "CREATE DATABASE" statement within the context manager of
+    psycopg library. See the following for details
+    `Stroy 2010761 <https://storyboard.openstack.org/#!/story/2010761>`__
+
diff --git a/trove/guestagent/datastore/postgres/service.py b/trove/guestagent/datastore/postgres/service.py
index 0712081c7a..4b000b8602 100644
--- a/trove/guestagent/datastore/postgres/service.py
+++ b/trove/guestagent/datastore/postgres/service.py
@@ -770,12 +770,15 @@ class PostgresConnection(object):
     def _execute_stmt(self, statement, identifiers, data_values, fetch,
                       autocommit=False):
         cmd = self._bind(statement, identifiers)
-        with psycopg2.connect(self.connect_str) as connection:
-            connection.autocommit = autocommit
+        connection = psycopg2.connect(self.connect_str)
+        connection.autocommit = autocommit
+        try:
             with connection.cursor() as cursor:
                 cursor.execute(cmd, data_values)
                 if fetch:
                     return cursor.fetchall()
+        finally:
+            connection.close()
 
     def _bind(self, statement, identifiers):
         if identifiers: