One of the pitfalls of us trying to guess where this oil-laden republic might be headed both economically and sociologically, is to compare it to other countries which have experienced similar booms.
For example one of the more simplistic warnings is that we should not become another Venezuela – resource rich but with a large poor population. This does not take into account our neighbour’s much larger population – 28m – and its century-long relationship with the oil industry followed by the socialist revolution under Hugo Chavez that drove out the oil majors and eventually led to crippling US sanctions in the name of restoring democracy.
Nigeria too is another example that really serves no purpose also given its massive population and post colonial ethnic complexities. Indeed, were one to look at the superior infrastructure of Lagos, it’s a bit rich for us to be critical, what with our ramshackle two lane road to the airport.
Then there is Dubai, which many here aspire to us becoming, with its banal bling-bling consumerism. We may be closer in relation to population size as this emirate was back in the 1970s but there are other factors worth consi-dering. This glittering city state was built by an autocratic leader upon a blank canvas of sand. Nothing and no one impeded his vision. No vendors or squatters on the sides of the roads, no environmentalists filing court cases.
So because of our minute population and the fact that the oil industry is clustered mainly around our capital it might therefore be more instructive to look at two cities that have experienced and dealt with oil booms.
We can also look at them through the prisms of what one would consider important measures of success for resource rich countries: how diver-sified their economies are; income equality and the eradication of poverty; and accountability and good governance.
Let’s start with Luanda, capital of Angola which has proven reserves of over 9 Billion barrels and currently exports some 1M per day. A 2015 New Yorker article “Extreme City- the severe inequality of the Angolan oil boom” vividly portrays life in Luanda which at the time was listed
as the world’s most expensive for expatriates.
Author Michael Specter notes that “President José Eduardo dos Santos, who has presided over Angola for more than thirty-five years, long ago realized that foreign oil companies were the key to power, and he has worked diligently to accommo-date them.” Despite the fancy restaurants and a per-capita income in Angola that “nearly tripled in the past dozen years…Nonetheless, by nearly every accepted measure, Angola remains one of the world’s least-developed nations.” At the time of the article, half of Angolans still lived on less than US$2.00 per day and it has barely budged up to now. In Luanda, zinc huts sit cheek by jowl next to apartments renting for $20k per month while the city has exploded from under 500,000 in the 1970s to over 6m. Meanwhile roads and other infrastructure were so poor that attempts to revive and develop a once thriving agriculture sector instead meant crops rotting in the fields.
By 2022, Transparency International ranked Angola 116 out of 180 in its Corruption Perception Index. (Guyana was 87th).
Aberdeen is a quite unusual case. Situated on the north east coast of Scotland it was a small fishing port city up to the early 1970s and the discovery of North Sea oil. Over the decades it has been transformed into the “Oil Capital of Europe”. By 2014 it had the highest percentage of millionaires in Britain. But as a Guardian article “Aberdeen, the oil city where boom and bust happen at the same time” reported in 2014, “With average rent more than £1,000 a month, Aberdeen is by some way the most expensive city in Scotland” contributing to homelessness. Food banks abound while income inequality is among the most extreme for the United Kingdom.
So where is Georgetown heading as we embark on this “adventure”? It is probably too early to say but anyone paying attention can see similarities with the other two cities.
The attempts of the President to encourage diversification of the economy are well documented such as shrimp farming, black belly sheep and other new agricultural projects. However the irony is that because the local content legislation is exclusive to the oil sector, it is funnelling capital and entrepreneurial energies into that industry. Secondly the sector is siphoning off workers from the non-oil economy. Rice farmers complain they can’t match the pay offered to machine operators and truck drivers. So too with the restaurant sector as Executive Director of the Tourism & Hospitality Association of Guyana, Oslyn Kirton told Stabroek Business recently.
It is hard to see how in a market economy Guyana can resist becoming a predominantly oil/construction/ hospitality city-based economy.
As for inequality and poverty this administration has made mostly feeble efforts to address the rising cost of living. Sending out a DPI press release that eggs and chicken are “still affordable” when they have increased by 45% and 25% over the past two years is reminiscent of Orwell’s “1984” and how Big Brother was praised for increasing rations on the chocolate bar to 20 grams when only a week earlier it had been reduced to the same amount. Protagonist Winston Smith wondered, “Was it possible that they could swallow that, after only twenty-four hours? Yes, they swallowed it.”
Perhaps only a holistic and nationally agreed cash transfer system can eliminate extreme poverty. Even with that, citizens in the capital still have to deal with rising costs of living and rent as land changes hands and demand for office and expat residential space grows. Minister Edghill in addressing residents of what he called the Albouystown “shantytown” was explicit that investors are looking for their real estate.
But probably the most concerning development is the growing lack of accountability. With oil revenues pouring down on them, this administration is detaching itself from the compact between the taxpayer citizen and the government that is the bedrock of modern democracies. Contrast for example how they sought (in vain) parliamentary approval of the Amaila Hydropower project in 2014, with how VP Jagdeo has forced the gas to power project upon us. We hear also of his party’s plans for the city even though his party remains a minority on the council. And what can only be seen as a deliberate tactic, the PPP/C members continue to be absent from the Public Accounts Committee meetings, while the Speaker of the House seems intent on subduing all attempts by the opposition to debate matters of national importance including the cost of living.
Democracy is suffocating beneath its “guardians”.
Meanwhile, President Ali spoke about his “Vision 2030” back in July 2022. It is astonishing that we, the citizens, have no clue of what he speaks nor have we been consulted on a matter of such national importance.
