Home Letters Guyana’s foreign policy format can lead to broader opportunities
Guyana’s oil resources have brought us new political and economic capital. Our Ministry of Foreign Affairs is strengthening existing relations with old allies, and building new partnerships with other oil-producing nations as a way of drawing foreign direct investment to both Guyana’s oil and non-oil sectors.
The latest example was Guyana’s announcement that it will open embassies in Qatar and the United Arab Emirates (UAE), joining the extant mission in Kuwait. The announcement of these embassies occurred after high-level visits and discussions were had with officials from the Middle East about Guyana’s oil sector, which also resulted in interest in agriculture and aid to help Guyana fight the COVID-19 pandemic.
Shortly after President Ali was inaugurated, a team from the UAE arrived in Guyana, and discussions were held about oil and gas, as well as the agricultural sector, including Guyana’s sugar industry, which has been the focus of the PPP/C administration.
To get sugar workers back to work, our President’s conversation with the Emir of Qatar mirrored that of the UAE, and it resulted in discussions about Qatari investment opportunities in Guyana’s halaal industry. The latter discussion also included Qatar sending a field hospital to Guyana to aid in the country’s fight against the pandemic.
Guyana, is primed to use its new economic clout to rapidly further its economic development. For perspective, an energy economist at the Inter-American Development Bank recently stated that if Guyana produces around 750,000 barrels of oil per day, by 2025, our country can surpass Venezuela, which holds one of the world’s largest oil reserves.
Even at its current capacity, Guyana is producing enough oil that it is the only Caribbean nation not to suffer an economic contraction as a result of the devasting COVID-19 pandemic.
Our PPP/C Government is capitalising upon this economic wealth by shifting Guyana’s foreign policy focus and objectives to a more business-friendly approach. While Guyana continues to focus on external matters, such as its longstanding border controversy with Venezuela and its relations with the US, China, and India, there is added attention toward new corners of the world, namely with states that offer Guyana new avenues to increase investments for the country.
For instance, in February 2021, Guyana announced that it would establish two new embassies in the Middle East. Guyana’s Mission in Kuwait and Consulates in Jordan, Israel, and Lebanon will be joined by one in the UAE, which is home to Dubai, and the other in Qatar.
Guyana can view opening new embassies as a method of entering new markets for its non-oil sectors in its efforts to diversify its economy by becoming less reliant on natural resources.
The visits and conversations have shown the utility of having them as potential investors in oil and gas, because, often, the results will include investments in the non-oil sector.
The petroleum sector will only serve to increase partnerships in areas of agriculture and the financial sector. If this is possible with old allies, the same can be seen for potentially new ones. As a result, to do this, Guyana would need to continue expanding its diplomatic relations. If an embassy is opened, it would move beyond one-off discussions between Government officials, and instead establish a direct, open line between each country’s representatives. And with the establishment of an embassy, there would consistently be an open line for potential investors.
Further, having an embassy means that Guyanese officials learn and understand the culture of the country that hosts the embassy, so they could market Guyana’s potential within the context of the host country.
Further, opening embassies can also open new markets for Guyana’s sugar industry, rice, the Private Sector, and for the country’s small businesses that might struggle to compete in traditional markets in the Western Hemisphere.
It is for this reason that President Ali recently commented that “the business community must not only think local, but also regional and international”; which means that with the establishment of the Middle East embassies, the Government has opened the pathway for new markets in the international arena
In addition, Guyana’s foreign policy format can lead to broader opportunities, including strengthening the country’s human capital through educational and people-to-people exchanges.
For example, Kuwait, the UAE, and Qatar have proven themselves adept in economic development as it pertains to oil and tourism. These embassies can help facilitate educational exchanges in which Guyanese people can travel to the Middle East and learn the technical skills that can help fill gaps in Guyana’s oil sector.
Further, it can incentivise people in the Middle East to travel to Guyana, thus adding a new source of tourism for the country.
Therefore, if Guyana continues to use its potential oil and gas wealth to leverage new diplomatic relationships in order to promote its development, Guyanese citizens would reap the benefits. However, the Government must not stop at the new UAE and Qatari embassies, but must instead expand quickly over the next decade. More embassies mean greater chances of investment opportunities for Guyana’s non-oil sector and, by extension, its people.
Guyana should continue to open embassies in the Middle East, such as with Saudi Arabia, but at the same time look toward European countries as it looks to increase markets for rice and sugar, as well as Africa and East Asia.
If the Government of Guyana manages to do this during the next 4 years, while the world watches its unprecedented economic growth, the country would quickly amplify its development, as promised by the PPP/C Administration.