In many new Third World oil producing countries, the discovery of oil reserves has been a mixed blessing. In some African states for example, it has led to massive corruption with politicians stealing a large proportion of the oil revenue. In other countries, oil has been allowed to replace all other industries, but as oil reserves are a finite resource and oil is subject to market whims when reserves are exhausted or prices fall, economic ruin and great social suffering occur. In other cases, governments and populations are so overwhelmed with the “bonanza syndrome” that they recklessly spend revenue on unproductive use until the day of reckoning arrives when oil reserves are exhausted or prices fall the market collapses and returns to its pre-oil economic state. This kind of experience has touched Trinidad.
Guyana has not escaped unscathed from the “oil curse” and the country’s losses, totaling tens of billions of dollars, occurred in the initial stages of negotiations with the alleged oil and corruption companies of a few politicians. Now, oil industry issues are settling down to equilibrium. This is due to the maturity of the Guyanese people who were never overtaken by the “bonanza syndrome,” except for the first few months after the oil discovery when there were proposals that every citizen should be given $ 5 million. In a few months, however, this offer disappeared.
More rational counsel existed and the Natural Resources Fund (NRF) was set up which would eventually be structured along the Norweigan lines, where oil reserves would be used for national economic and social development and also as insurance for subsequent generations. Measures are taken to have as much political control as possible over such funds and there would be full transparency in the receipt and spending of funds. The population realizes that oil is a finite and temporary resource and that its primary use would be to provide capital investment for economic and social projects such as Agriculture, Industry, Infrastructure, Health and Education among others. Employment would increase and wages would be higher and the standard of living of the population would be continually improved. The population hates pollution and is aware of the danger of Dutch Disease.
Recently in his address at the 2021 Guyana Basin Summit, President Irfaan Ali reiterated that Guyana’s oil revenues would be spent on social and economic development. He pointed out that since the oil and gas discoveries, Guyana’s attraction as an investment destination has grown, and he invited investors to consider the myriad of other investment opportunities in the country.
President Ali said: “I want to say to all potential investors, ‘you need to come, you need to explore and you need to take a holistic view of the diverse opportunities in Guyana, whether in large-scale agricultural production , whether it is in mining; is he in forestry; is it the healthcare system; whether in the education system; you need to understand Guyana’s various potential offers for different types of investors; it is not just about oil and gas. . .
“The local private sector needs to play a greater role in the planned economic transformation and growth and development through synergies and partnerships with overseas businesses. To enable this, the draft Local Content Policy and Law aims to drive a stronger and stronger local business environment. . . The oil and gas sector will complement the traditional sectors, which will be modernized and will maintain their roles as key economic sustainers. ”
President Ali stressed that his government would not ignore the interests of the employees against private investors: “We are uncompromising in respecting our people, especially our employees. We demand that the rights of our employees are respected and that investors comply with our labor laws. ”
There is one important area on which the government has not yet made any public pronouncements, that is, modernizing the country’s citizenship and immigration laws. With increased economic development would be an influx of foreigners who could overwhelm Guyanese identity; there are signs of such an influx with the number of people applying for naturalization and the number of foreigners settling in the border areas of Brazil and Venezuela. In modernizing the citizenship and immigration laws, the U.S. experience and its laws in this regard could be informative. For example, anyone who wants to live here should be familiar with the English Language and know the country’s history, especially in areas such as Guyana-Venezuela border culture and debate. There could also be a quota system as in earlier American Legislation. Such an update of the citizenship and immigration laws is urgently needed.