Guyana: “Oil don’t spoil” but … By: Ivelaw Lloyd Griffith – Opinion

By: Ivelaw Lloyd Griffith – October 8, 2020

Dr. Eric Williams, the late Prime Minister of oil-rich Trinidad and Tobago, once famously declared: “oil don’t spoil.” That statement is, undoubtedly, true. However, for new kid on the oil block Guyana, there is copious evidence, from neighboring Venezuela and far away Nigeria, that although oil doesn’t spoil, it can spoil lives and livelihoods of individuals and entire societies. A key question, then, is how might the political and corporate leaders in Guyana avoid trailing the path of societies where oil did spoil things?

The success stories of countries as different as Norway and Kuwait, where oil hasn’t spoiled things (much), suggest that success revolves around several interconnected variables, which can be placed in several baskets—or, perhaps, barrels, given the product we’re dealing with. The Technical Skills and Competencies Barrel is one such. There are three others, some of which often get short shrift when new kids on the block rush to reap the rewards of their black gold.             

The Value of Values

The Values Barrel is one of them. Oil booms generate considerable wealth and foster greed and graft, making corruption a corrosive spoiler of individuals and institutions and sometimes of whole societies. Thus, honesty is a value that must be both preached and practiced. Not just by government leaders, but also by the corporate and civic bosses, and in religious and educational institutions and the media.

Going hand in hand with honesty is transparency, not merely to share with citizens the what, when, and how of government and business dealings, but also to build and sustain trust—in leaders and institutions. Plus, in Guyana’s case its needed to serve as a key element in the racial and political healing that’s now needed, coming in the aftermath of the political-electoral roller coaster. Allied with honesty and transparency is respect, for the country’s racial, religious, and political diversity, its laws, and its institutions. Corruption and the disrespect for laws and human life that the country’s high road carnage reflect are two examples of the considerable respect deficit in the society. Respect also is vital for the healing needed given the dynamics of the recent contestation for political power.

Institutions

Key, too, is the Institutions Barrel. Regulatory institutions are essential. However, not only should they exit, they must be functional and efficient, all the more so when the industry landscape is dotted  with multiple oil companies, some of which have long histories and presence in various parts of the world where their practices have been pregnant with shady dealings. Some of these companies also can bring their multinational technical and legal skills and competencies to upend things in small jurisdictions with weak institutions or political or civil discord.

Keep in mind that while ExxonMobil dominates the headlines in relation to the Liza field with its oil reserves totaling eight billion barrels, the Liza operations involve a consortium that involves Hess, another United States oil giant, and China’s National Offshore Oil Corporation. Still, those corporate giants are not the only players in Guyana. Anadarko, which is headquartered in Texas and was acquired by Occidental Petroleum in 2019, CGX Energy of Canada, Israel’s Ratio Oil, Spain’s Repsol, and Britain’s Tullow are also there. And other firms are likely to turn their spotlights on the new El Dorado.

Yet, while strengthening regulatory institutions is necessary, it is not sufficient. Crucial, too, are the country’s educational and judicial institutions. As regards the first, the strengthening is needed holistically—at the primary and secondary levels, among the technical and vocational institutes, and at the University of Guyana. In relation to the judicial institutions, attention must not only be paid to deepening and widening the competencies of the current magistrates and judges, but a revamping of the entire judicial architecture and some of the anachronistic modes of operation might become necessary. The Bar Associations also will need to broaden the educational and practice horizons of their members.

In all this, for the regulatory, educational, and judicial institutions, professionalism must be made to trump patronage. The temptation to make appointments or replacements based on political or racial partisanship to ensure loyalty or to reward electoral allegiance must be resisted.

Infrastructure

The final barrel is the Infrastructure one. Both the previous government and the current one must be commended for recognizing the importance of transportation and telecommunications infrastructure and touted plans to build new roads, bridges, airports, and seaports, and refurbish existing ones, among other things. Quite appropriately, the Ali government plans to use some of the oil funds to underwrite the infrastructure investments. Nonetheless, beyond these they would be wise to begin considering infrastructure investments that are tied to the country’s existence in what I call a Wet Neighborhood.

In comparative Caribbean terms, Guyana is a relatively large nation. It is 20 times the size of Jamaica and it could accommodate all the member countries of CARICOM in its 83,000 square mile territory. Guyana faces some stark realities, though. It has a 285-mile Atlantic coast that is below sea level as much as six feet in some places; the capital, Georgetown, lies along that coast; and some 80 percent of the country’s population lives there. Moreover, its coastline is subsiding due to groundwater extraction, soil compaction, and drainage of the wetlands.

To make things worse, because of climate change, the sea level has risen at a rate some six times the global average. All of this makes the country vulnerable to coastal flooding, which is a perennial problem. The most devastating flood occurred a decade and a half ago. It affected more than 80 percent of the population, killed 34 people, and left an estimated US$500 million in damages. Still, given the vicissitudes of climate change, flood mitigation alone will not suffice. The relocation of the capital is necessary.

Guyana has two major assets that it can leverage for the existential infrastructure investment involved in moving its capital. One is the funds from the oil boom, and the other is a president with a doctorate in urban and regional planning. One hopes the government uses these assets, and sooner rather than later. Surely, oil doesn’t spoil. Still, a massive torrent of water from the Atlantic Ocean definitely will spoil things in unimaginable ways and shatter the hopes and dreams of local Guyanese and the executives and investors of the oil giants.

___________________________-

Ivelaw Lloyd Griffith, a former Vice Chancellor of the University of Guyana, is a Senior Associate with the Center for Strategic and International Studies in Washington, DC. His next book, Challenged Sovereignty, will be published by the University of Illinois Press.

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Comments

  • kamtanblog  On October 14, 2020 at 1:43 am

    Interesting take !
    Hope the powers that be in Guyana follow
    GOL and not pay too much attention to MSM
    or Social media ….political jackasses mantra
    “Political correctness”
    How to win votes and influence people/public

    For decades have suggested city Georgetown
    Be moved further upriver to higher ground
    nearer CJA airport.
    Let’s hope the tsunami never hits GT.
    Also oil funds used to develop infrastructure
    (schools hospitals new city et al)
    Not rocket science 🚀 🧪

    Off my soap box Hyde Park Corner london

    Kamtan-uk-ex-EU

  • Joan Seymour  On October 14, 2020 at 3:48 pm

    I strongly support the views of the author above. In particular I think steps should be taken as soon as possible to relocate the capital inland. The next storm and flood may not be too far away.

  • detow  On October 14, 2020 at 6:12 pm

    It does not take a rocket scientist to realize that sooner or later, maybe sooner than we think, a major catastrophe will occur in the Atlantic Ocean that will have devastating effect on the coastline of Guyana and due to its position below sea level, the entire area below Atkinson will be reclaimed by nature.

    Brazil recognized the potential for the then capital city of Rio de Janeiro to suffer eradication by the ocean and took the opportunity to begin moving their capital to an area in the interior of that nation that may remain above sea level in the case of uncontrolled over topping. Their capital is now BRASILIA.

    Guyanese are too damned stupid to recognize the same threat to Georgetown and all areas east and west of that capital city that are known to be below the level of the Atlantic Ocean. Guyanese focus continues to be who “de pon top” and all of the other petty issues that no sensible person would allow a second thought, while the nation continues to be at the perils of the Atlantic Ocean.

    Way to go Guyana, continue on your current path which may be the solution to all of your problems…teach everyone to swim long distances.

  • Dennis Albert  On October 15, 2020 at 5:45 am

    Way too much money involved in the fancy high rises to reconsider moving the capital. There are plans to build double digit story high buildings across Region 4. I wouldn’t be surprised if places like Parika and Bartica start getting ten storey buildings.

  • detow  On October 15, 2020 at 5:42 pm

    Build them as high as you like, when the Atlantic Ocean decides to retake the land you will have many, many high rises with flooded first to possibly fourth floors and the undermining of foundations with the inevitable collapse of total high rises. Like I said, go for it Guyana, stay the course but teach the people to swim long disitances.

    • Dennis Albert  On October 15, 2020 at 7:20 pm

      The Indo-Caribbean elite building as high as they can get:

      • kamtanblog  On October 16, 2020 at 2:27 am

        What surprises me most is Guyana has so
        much land 83.000M2 and they still wish to
        go “skywards”….
        Cities in the developed world are becoming
        less popular places to live/work. Most office blocks are empty as more people are
        working from home (the technology is
        facilitating IT)
        Wouldn’t wish to spend my holidays in
        a “towering” inferno in GT.
        Thanks but no thanks

        Kamtan uk-ex-EU

      • Dennis Albert  On October 16, 2020 at 4:02 pm

        The catch-22 is that many Guyanese who voted for Jagdeo wanted to emulate the skyscrapers of the oil-producing countries in the Arabian desert, yet do not want the population growth that is needed to sustain that growth in housing.

        Building 100 ten story buildings across the Marriott hotel require people to book, stay and pay money to make it viable, or am I thinking it wrong?
        Why build hundreds of ten story buildings but loathe that warm bodies are needed to pay money into the business?

        One can argue that foreign money is still required to buy up the overpriced ten story buildings.

  • Lil Pump Fanclub  On October 16, 2020 at 4:01 am

    Flood done flush out squatters:
    https://www.kaieteurnewsonline.com/2020/10/16/guysuco-floods-success-lands-to-flush-out-squatters/

    Mo land for the Badalesque Hotel Pegasuses!

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