While Guyana’s GDP growth rate is expected to reach unprecedented levels this year because of the commencement of crude oil production, three events will almost certainly have an adverse effect on such growth. These are the yet-to-be-determined elections outcome, falling oil prices and the coronavirus pandemic. The situation is made worse because of weak public service delivery and monitoring systems that ‘constrain the development of policies to reduce poverty and protect the vulnerable’. These observations are contained in the World Bank’s 12 April 2020 semi-annual report on Latin America and the Caribbean to be found at https://openknowledge.worldbank.org/handle/10986/33555.
The report projects a GDP growth of 51.7% this year (considerably less than the 86 percent reported earlier), 8.7% for 2021 and 2.6% for 2022. We must, however, caution that, while GDP growth is generally considered a reasonable measure of economic health of the country, it does not necessarily translate to a corresponding improvement in the standard of living of citizens. GDP growth, by definition, is the increase in the production of all goods and services in a country during a given period of time, regardless of who owns the means of production. This is unlike GNP growth which excludes goods and services produced in a country by non-residents.
GNP uses GDP as a convenient starting point to which is added investment income from residents from their overseas investments, after which a deduction is made for investment income earned within a country by non-residents. It has been argued that the GNP growth is a more realistic measure in situations where there is a significant mismatch between foreign investment in a country and that country’s investment abroad. Where the gap is narrow, the GDP and GNP approximate each other. In the case of Guyana, however, this gap is considerably wide, since overseas investment is significantly less, compared with foreign investment in the country.
As of last Friday, the WTI price of crude oil was US$18.12 per barrel despite an agreement between Russia and Saudi Arabia to cut production in response to falling demand. This price is significantly below ExxonMobil’s break-even point of around US$35 per barrel in respect of its operations in Guyana, raising questions as to whether it is economically feasible for it to continue production. Although we have received US$55 million for the sale of our first shipment of oil, all indications are that we are more likely to earn considerably less for future shipments. Account also needs to be taken of the significant amounts of liabilities to discharge, such as pre-contract costs of about US$900 million. We had argued several times over about the need to have a sufficiently diversified economy and not to be over-dependent on oil revenues. This is where non-oil GDP growth becomes more relevant as a measure of health of the economy. Incidentally, last year around this time, the Ministry of Finance had released its 2018 end-of-year report on the performance of the economy. We hope this it is in the process of doing so in respect of 2019.
We ended last week’s article by posing the question: Are we going to allow the country to go back to the pre-1992 days? This was in reference to the period of authoritarian rule from 1968 to 1992 when five successive elections – 1968, 1973, 1978, 1980 and 1985 – were severely tampered with to perpetuate a government that did not represent the will of the people. In the 1973 elections, this columnist had travelled from Georgetown to Corentyne to cast his ballot for the first time. One out of every three persons in the line was told that he/she had either voted already or the person had died!
Democracy and accountability
The Constitution specifically states that Guyana is a sovereign democratic State and that sovereignty belongs to the people. Periodically, through a free, fair, transparent and credible electoral process, citizens choose their leaders to manage on their behalf the affairs of the State. A government that has been elected through this process must be accountable to the people for its stewardship responsibilities. If it fails to do so, the latter are likely to exercise their power by choosing new leaders in the next round of elections. This is the essence of democracy. When that process – accountability to the people – is tampered with to subvert the will of the people, all other forms of accountability collapse around it. This was what happened in the 24 years of authoritarian rule in Guyana. Public accountability had been brought to a halt in 1981, only to be resumed with effect from 1992. That gap covering the period 1982 to 1991 remains a significant blemish in the history of public accountability in Guyana.
By the mid-1980s, Guyana was unable to meet its debt obligation to the international and bilateral agencies, resulting in the IMF declaring the country ineligible for the grant of further credit. Guyana became the first member country to be so declared. It was therefore technically bankrupt. Foreign currency shortages had a crippling effect as the economy was brought to a standstill. Through the efforts of the late President Hoyte, the IMF approved of a rescue package in 1988 in the form of the Economic Recovery Programme (ERP). Though painful during the initial years, the ERP saw a change in the fortunes of the country.
Reaction to threat of sanctions
Concerned about the threat of sanctions if the Government is sworn in on the basis of the fiddled electoral results, the APNU+AFC Administration reportedly engaged the services of a consulting firm to lobby Washington in an attempt to change the narrative of what transpired during the last six weeks. A document entitled “Dossier: The Guyana Elections 2020” was prepared setting out the Administration’s version of events and was filed with the U.S. Department of Justice on 31 March 2020. The Director-General of the Ministry of the Presidency confirmed that this was an initiative taken by the Government. However, on Friday, the Ministry of the Presidency issued a statement denying the Government’s involvement.
It defies logical thinking that a party winning the polls for nine of the ten regions by 51,439 votes ahead of its nearest rival, would seek to disrupt the vote count, as contended by the dossier. For a vivid account of what transpired on 5-6 March 2020, readers are directed to the comments of Attorney-at-law Selwyn Pieters, an election observer, as reported by the Stabroek News on 12 March 2020. One can also refer to the Commonwealth Observer Group’s assessment, including its attestation that ‘[t]he robust exchanges between political party agents in the room only occurred when the GECOM repeatedly halted the tabulation process’.
Another key contention contained in the dossier is that the Opposition, through its communist leanings, will jeopardise the interest of the Western powers, particularly the United States, if allowed to manage the affairs of the State. That contention should have been taken to the electorate during the election campaign in the hope of winning their support, and not to the U.S. capital. That apart, although all indications suggest that the main opposition party won the elections, the APNU+AFC Administration is insisting on remaining in office. It is therefore invoking the communist bogeyman, hoping to influence the Western nations to reconsider imposing sanctions on any illegitimate government formed as a result of bogus election results. It would, however, be extremely surprising if Washington and other Western capitals were to decide to soften their positions. After all, their representatives in Guyana as well as the international observers to the elections have all witnessed first-hand how the results were manipulated in the crudest way to favour APNU+AFC.
In every election, there are winners and losers. The issue at hand is not about good guys and bad guys; the lesser of two evils; friend or foe of the Western powers; or geo-political considerations. Rather, the central and fundamental issue is about thwarting the will of the people to elect a government of their choice. All other considerations are peripheral or subordinate to this indispensable element of democracy. Once the results are out, the losers are expected to accept defeat and proceed to work immediately in an effort to win the elections in the next round. This is the practice of the civilized world. In 1992, Mr. Hoyte accepted defeat gracefully amid attempts to derail the electoral process, and attended the inauguration of the new President. This was even before the results of the poll were officially declared. President Jimmy Carter used the exit poll results to explain to Hoyte that his party had lost the elections.
Mr. Hoyte reportedly told his Ministers that they deserved to be in the Opposition for the next five years during which period they must upgrade themselves intellectually and professionally to better serve the nation. He led by example, took up his seat as Leader of the Opposition in the National Assembly, and discharged his responsibilities faithfully. It is unfortunate that many people took literally his statement and misinterpreted what he meant when he said, ‘Slow fire, more fire’. Mr. Granger needs to take a leaf from Mr. Hoyte’s book, and do likewise by immediately conceding defeat rather than waiting for the results of the recount to do so, if he is to leave a cherished and lasting legacy. The overwhelming evidence suggests that his party lost the elections.
Status of GECOM’s decision on recount of the votes
The Elections Commission met last Tuesday but was unable to make further progress as regards the recount of the votes cast at the 2 March 2020 elections. The Chief Election Officer (CEO) did not submit a reworked plan, based on the counter-proposal of the opposition-nominated commissioners. The CEO had proposed a plan that would have resulted in the recount taking 156 days. Immediately, there were widespread criticisms of the plan, with the OAS Observer Mission asserting that five months to count less than 500,000 votes is ‘is unheard of in any democracy and would be unacceptable under any circumstances’. The Common-wealth Observer Mission added its voice by stating:
The people of Guyana have now waited an unconscionable 45 days to bring this electoral process to finality…This [the right to vote for a government of their choice] is a sacred constitutional and universal human right. The rights of the Guya-nese people will be respected when a general final count is credibly administered in accordance with the law and given full effect.
At the meeting, GECOM Secretariat sought further clarifications from the Commission on the details of the proposed recount. Meanwhile, the Commission wrote to the CARICOM Secretariat requesting the return of the high-level team to participate in the validation of the recount, and a response was being awaited.
On Wednesday, the Commission visited the Arthur Chung Convention Centre where the recount is expected to take place. The opposition-nominated commissioners’ counter-proposal was for 20 workstations to be used while a government-nominated commissioner argued for eight workstations. On Friday, GECOM Chair announced that there would be no more than ten workstations, subject to the availability of the requisite equipment and technology to display the results. She, however, did not say when the exercise would commence, the expected duration, number of hours to be worked each day, and who will be involved in the count. This prompted five of the political parties contesting the elections to issue a joint statement indicating their dissatisfaction with the announcement. There have also been calls for the CEO, the Deputy CEO, the Returning Officer for Region 4 and certain staff members of GECOM Secretariat who were complicit in the tampering of the results, to be excluded from the recount.
Constitutional provisions for convening Parliament
Article 69(1) of the Constitution requires each session of Parliament to be held within four months of its dissolution. The President dissolved Parliament on 30 December 2019 and therefore the deadline for the commencement of new session is next Monday. Since the recount is yet to commence, it is extremely unlikely that the results will be known by then. Article 61 also requires the election of members of the National Assembly to be held within three months after dissolution. That deadline of 30 March 2020 has since passed.
Next week, we will examine the implications of not having a budget in place for 2020.
