It can be no secret that with a population of three-quarters of a million, our market is simply too small for us to seriously consider autarkic economic policies. That is, a goal of achieving self-sufficiency in fulfilling our basic needs, which it would appear Burnham aspired towards when he effectively banned several essential items during his dictatorship. Ironically, he recognised the unreality of that aspiration when he helped to usher in CARIFTA – a free trade zone – among a number of former British West Indian colonies (1968), which then evolved into Caricom in 1973. At a minimum, the leaders were hoping to benefit from the assumed “economies of scale”, but also aspiring to create a “community”, with all that that implies. The leaders were imitating the example of the ex-colonial European rulers, who had formed the European Economic Community in 1958 and which morphed into the European Union in 1992.
But the colonial order had imposed a mindset that violated the first law of Geography: “everything is related to everything else, but near things are more related than distant things.” To wit, that while the entire world is related – and increasingly so in an age of hyper-globalisation – for us in Guyana, our neighbours in South America were logically “more related” physically, and advantage should have been taken to convert that relation into economic ties to create synergies way above economies of scale –especially when we shared a border with Brazil and historically good relations with one of the largest economies in the world. A Common Single Market and Economy goal was adopted by Caricom in 1989, but it never even fructified between us and next-door Suriname, which became a member in 1996. It was put on “pause”, where it remains in suspended animation.
In the meantime, under the leadership of our southern neighbours Brazil and Argentina, South America had embarked on its own ambitious “Southern Union” – Mercosur – in 1991. In 2013, Guyana became an Associate State of that bloc through a special arrangement that qualified states that had special trade arrangements with a Mercosur member – in this case, with Brazil. This was the “Economic Complementation Partial Scope Agreement in 2001, which gave tariff-free entry to an enumerated number of Guyanese products. Unfortunately, after an initial rapid increase in intra-Mercosur trade, the benefits of the union lagged by the time we joined.
Mercosur, like Caricom, has not moved from being a trade agreement to a customs union. China has since become the largest trading partner with all of the Mercosur states, and this remains the status quo today.
However, the just concluded visit of the President of Suriname, along with a large complement of high-level Government officials, to conclude a raft of trade and other economic agreements suggests that Guyana is poised to enter a new era as far as effectively taking economic advantage of the first law of geography is concerned, especially to enter into global and regional value chains. With Guyana and Suriname serendipitously becoming probably the last major oil/petroleum play in South America – if not the world – as we move into a new regime of renewable energy, there is much scope for cooperation, and this was given official recognition. Agreements on the Corentyne Bridge between Suriname and Guyana, and the completion of the paved Linden-Lethem Highway would make trade with Brazil much more feasible, as had been expected with the Tatuku Bridge into the latter country. Earlier this year, President Ali indicated the intention of his administration to strengthen economic linkages with South American neighbours, and this was reiterated by both him and President Santokhi as they evinced an early meeting with the President of Brazil was on the cards.
This year marks the 30th anniversary of Mercosur, and maybe the leaders of this important economic bloc might be inspired by its early promise and accomplishments to once again test the maxim that in unity lies strength. And Guyana and Suriname might at last be able to fulfill their geographic post-colonial continental destiny.
