As our politicians debate Government’s $1.382 trillion 2025 Budget, presented under the theme, “A Secure, Prosperous, and Sustainable Guyana”, we may paraphrase Marx’s aphorism: Countries make their histories, but not conditions of their making”.
One of these conditions is “globalisation”, which started its present literal iteration after Columbus stumbled across the Americas, and Europe realized the world was not flat, but was in fact a globe. We were there when the plantations of the Dutch, and then the English, were created through slave labour to supply agricultural products for Europe. As our lands in the “new world” became populated, “free trade” replaced the mercantilist policies of the imperial powers, and became driven by comparative advantages in production of goods and services.
There was an ebb-and-flow between protectionism and free trade over the years, but, in the late 20th century, free trade accelerated to unbelievable levels during the communication and transportation revolutions. The world truly became a village, as each country attempted to move up the value chain in its productive capacity so as to deliver improved standards of living to its citizens. In Guyana, however, the PNC regime, after independence, embarked on what turned out to be a detour and frolic as far as following that path of development. Rather than diversifying outside the plantation economy in a strategic fashion, by identifying products it could export at an advantage and earn foreign exchange to purchase those items it did not produce, it chose an autarkic strategy that was bound to fail because of our extremely small and underdeveloped markets. Burnham’s policies, compared to Lee Kwan Yew’s for Singapore, which became independent around the same time as we did, is an object lesson in the importance of strategic decisions in the development of former colonies.
In the latter part of the 20th century, the Far Eastern Tigers replicated Singapore’s success, and demonstrated that the export-driven strategy was transferable. Presently, we have also taken the lead within the region for food security, and made a commitment to reduce Caricom’s US$6 billion food bill by 25% by 2025 this year. Now, while this is a good strategic choice in one area where we do have a comparative advantage – land/agriculture – by coupling it with new crops like soya and corn, and by rearing cattle, this, although necessary, is not sufficient to take full advantage of globalisation and move up the development scale. For that to occur, we must, at each stage, use the technology that we have mastered and move to a higher level. By focusing only on agriculture, we would inevitably reach a point of diminishing returns and stagnated horizons. As such, our burgeoning oil industry offers us a platform for moving us strategically into a higher quantum level of development.
Take, for instance, the gas-to-shore project, on which the Government has embarked and which has been severely criticized by some elements putatively on “environmental” grounds. This initiative offers Guyanese the opportunity to develop manufacturing skills and expertise to an intermediate level – such as manufacturing urea from Natural Gas, which has been tried and trusted for a hundred years, so there is not much risk involved. Within a few years – before our oil has run out — we should be controlling a bulging Natural Resource Fund (NRF) that could facilitate us moving to a higher level of production and continue onwards and upwards on a virtuous cycle.
That globalisation stumbled because of supply-chain issues precipitated by the COVID-19 pandemic, and then the Ukraine War exposed its downside, is evident. However, the World Economic Forum, which has just been concluded at Davos, is resolved to continue its inexorable march; and not even President Trump, who is trumping a “Make America Great Again” mantra, would be able to buck globalisation and cause it to retreat into a new isolationism. We have no choice but to exploit the opportunities presented in the evolving dispensation by making strategic decisions on what we would produce going forward.
