Home Letters Contrary to uninformed views, Ali has put Guyana on path to prosperity
I wish to respond to the Kaieteur News front-page article of August 10, “President Ali puts Guyana in reverse gear”.
Everyone is trapped in the euphoria of Guyana’s new-found oil. Understandably so. Oil brings wealth and prosperity. But history, and current events, also prove that oil brings wars, corruption, and hunger. Global history has many lessons we should pay heed to, lest we fall prey to the maxim, “Those who cannot remember the past are condemned to repeat it.” (Santayana, George, 1905).
Take the example of Nigeria. In 2019 Nigeria ranked 10th (The USA, 11th) in the world for proven oil reserves (37.1 billion barrels). Oil was first discovered in 1956 in Nigeria, and by the late 60s and early 70s, the country was producing over two million barrels of oil per day. Like a mythical two-headed Greek God, the other side of oil boon is the “resource curse.” (Resource curse is the term used to describe the failure of resource-rich countries to benefit from their natural wealth, such as oil.)
Alleged corruption skyrocketed, with Nigeria ranking as one of the most corrupt African countries, holding the 146th position (of 180 in the world). Nigeria is Africa’s wealthiest and most populous nation. Despite its wealth, half of Nigeria’s population is living below the international poverty line (US$2 per day) and northern Nigeria has the world’s third most chronic malnutrition amongst children (World Bank Report, 2018). Nigeria holds the unenviable title of the Poverty Capital of the World. Petroleum production and export dominate the Nigerian economy, accounting for over 95 per cent of export earnings and 70 per cent of all Government revenues in 2019. Agriculture, the once-dominant and buoyant industry has been pushed in the background…whilst citizens are starving.
Forget Nigeria. Look at our neighbour. Venezuela holds the highest proven oil reserves – 302.8 billion barrels – in the world (US EIA, 2020). Guyanese can see firsthand for themselves the corruption, violence, and hardship in that country.
According to George Soros, “The resource curse is a major scourge, but it can be cured. It is now been recognised that transparency and accountability are the remedies.” “Transparency” and “accountability” are two tenets President Ali has been expounding repeatedly before and since he came into office.
On the other side of the spectrum are those countries that have cautiously and wisely used their oil wealth for jaw-dropping diversifications, such as infrastructural development, farming, manufacturing, and services. Look at Dubai, Norway, UK, USA, and Canada. Same oil. What is the difference? Transparency and accountability; competent and visionary leadership and management.
Look at neighbouring Brazil. Brazil has the second-largest oil reserves (12.9 billion barrels – 2019) in Latin America, second only to Venezuela. Does Brazil focus only on this source of natural wealth as our author in the article wants President Ali to do?
Let us look briefly at a few undeniable facts. Brazil is the world’s largest producer of sugar (ceding only to India last year), coffee, soya beans, and the tenth-largest producer of rice; Brazil is the second-largest producer of beef, second to the USA. These are all agricultural produces. Despite its vast oil resources, Brazil generates 75 per cent of electricity from hydropower. The country also has an impressive manufacturing sector, for example, it is the 4th largest manufacturer of aeroplanes. More astounding is that jobs (2019) in the service sector dwarf all others at 71 per cent, compared to industry (including oil) (20 per cent) and farming (9 per cent).
Brazil, like all other countries that have avoided the scourge of the resource curse, has seen the wisdom in diversifying its finite oil resources. Our author wants President Ali to focus solely on one natural resource and become like Nigeria (at least before 2015). Which sector will employ our people? What happens to future generations when this finite resource is exhausted? What happens if a better alternative to oil is discovered?
President Ali has propounded time-tested economic, institutional, and democratic principles – diversification, rejuvenating the agricultural sector, job creation, unity amongst our people, public-private partnerships, use of hydropower and less reliance on fossils, whilst taking the forefront on transparency and accountability (and demanding it from his subordinates). I am confident His Excellency will unleash our energy sector, drive economic and job growth, and simultaneously protect the environment. Contrary to the uninformed views presented, President Ali has put Guyana on the path to prosperity. God bless President Ali. God bless Guyana.