The last rolling press release on the existence of billions of barrels of oil beneath Guyana’s waters was around January 27 2020 in Forbes.
That joins the string of recent releases foretelling wealth beyond imagination that is the nation’s patrimony.
Exxon alone predicts 750K barrels of oil daily. Rough estimates at $50 per barrel yields $15bn per year. ‘
Bets that there will be gross mismanagement and that Guyana will suffer the ‘resource curse’ Capitalists predict when “natives” are suddenly awash in oil revenue are yielding high odds amongst international bodies familiar with the malady.
So, the Coalition’s pledge not to excessively borrow ahead of the anticipated revenue is prudent, as is its establishment of a Sovereign Wealth Fund, SWF, the quiet command of international bodies to countries with booming natural resources as protection against corruption which Governments obey to retain their seats at the international table.
Mal Administration and corruption during the Jagdeo / PPP tenure forced the country into international remedial fraud programs. But it remains on the Corruption Perception Index undoing 23 years of systemic corruption and mayhem in 36 months of sabotaged government is simply impossible.
Christopher Ram , hero of accounting propriety, details the pervasiveness and resulting crippling effect of the PPP criminal enterprise, in one of his more honest analyses .
And this explains why, as recently as 2017, the Inter American Development Bank, IADB, annual report 1:2 and 1:3 still pointed to Guyana’s low Human Development Index score (poverty .64); ascribed a paltry ‘clean’ index score- 34 out of 100 only; asserting that its low infra structure investment 3.6 vs 5.2 of GDP was a result of years of endemic corruption.
Uprooting corruption is more than a 36 month assignment.
We will say, however, that a Coalition Green Paper on a Sovereign Wealth Fund that seems to lump oil with other natural resources because Fund administration is deemed “complex” and lumping is perceived as “most efficient”(pg 19: 43-44) creates the propensity for a lack of transparency.
Not being able to account for the individual natural resources accurately substantiates the image of corruption such a Fund seeks to shed.
It would be comforting to see more proactive built in controls to prevent funds going the way of contracts with Bai Shan Lin and Vaitarna and Rusal; the ones Ram slammed the Peoples Progressive Party PPP on.
So pledge, Granger Government, to renegotiate the Production Sharing Oil Agreement, as is the opinion of so many international business professionals.
The Minister of Finance’s infamous “matters not if it’s a good deal or bad deal”conclusion should not be the defining position of the Coalition when the annals of history are examined to determine the degree of efficiency with which the Coalition oversaw national Patrimony. The difference here is the potential loss of billions to the Nation.
And the proximity of Government to access of the Sovereign Wealth Fund should not be an easy talking point for those whose mission is to cast doubt.
The Coalition’s hired expert Erric Parrado Herrra explained that the SWF is an extra budgetary fund that should not be conflated with the national budget which is calculated on other revenues like property tax and sales tax travel tax etc. Calling it a rainy day shelter not to be dipped into to cover current national expenses, he stressed separation of the SWF from easy Government access to prevent that temptation.
With no Constitution Reform to address Protection of Patrimony through referendum only and the possibility of another Party ascending to office without this guard rail in place, Campaign messaging should include reassurance that the Protection of Oil Wealth for the citizens is Government’s mission, as is its commitment to drawing a clear and hard line between the Sovereign Wealth Fund, Bank of Guyana and Ministry of Finance in a role (pages 23 thru 27) that Parrado warned against.
And when we say referendum, it is usually imperative to couple that with the fact that the PPP is the only Party in the nation’s history to be deemed guilty by the Courts of Law of electoral fraud… a necessary punctuation for those who associate referendum with conjecture.
Managing the public trust should be a key thread through this Campaign messaging season.
Why hire Merrill Lynch the Financial Predator of SWF unscrupulousness to invest for a Fund of this magnitude when local investor talent can be vetted and used?
And, given the history of government and public trust, wouldn’t it be better to message while campaigning that a report evaluating the performance of the Sovereign Wealth Fund will be issued every quarter, so that corrections could be made on a timely basis if needed?
How about relaying, to the Public, plans to utilize a specified percentage of Funds on an annual basis to rebuild and re-tool school houses, hospitals, roads, drainage, irrigation, power and water distribution, mosquito and fly control, install controlled public transportation, restoration of historic buildings, improve the connection of the Interior and other areas to the rest of the country, simultaneously, so that there will be overall improvements without regions feeling left out?
And while you’re at it, you may want to clarify why at viii on page 51 of the Green Paper, the National Bank of Kazakhstan will serve as Operational Manager of the Fund.
Kazakhstan, from all reports, is consistently embroiled in corruption, is condemned as a kleptocracy, is cited as high risk in most sectors, breeds bribery and is a Petri dish for testing new methods to steal from government.
Its removal from the list of most corrupt in 2017 still lands it on the list of corrupt so why, if Public Trust is the goal, would Kazakhstan be a choice for Guyana’s first ever Sovereign Wealth Fund?
We understand that errors may be made so we look forward to hearing changes in Campaign messaging that address these vital issues.
Kazakhstan will be removed as Fund overseer, irrespective of Guyana’s Foreign Relations Chairmanship ties with them. Promise that.
It is a sign of good governance when a nation, rich in natural resources, has a high Human Development Index- Low Poverty– because that comports with citizens rightly receiving the benefits of their patrimony. Pledge that.
Guyana’s low ranking on the Human Development (Poverty) Index was because of previously corrupt governance. Say that.
The image of endemic corruption and wholesale banditry that follows the country was earned under the Jagdeo and PPP Administration. A Coalition Government will fix that.
The count down to the most critical election in national history is less than 30 days away. The importance of informative messaging cannot be overstated. Discourse calibrated to reach beyond the perimeters of partisan expectation cannot be over valued.
Of the 50 years that the country was declared a Cooperative Republic, 23 consecutive years saw it governed purely for access to its treasury through a series of Accounting and Auditing frauds. Just ask Chris Ram.
50th anniversary, greater natural resources in oil, even greater incentive for those who have plundered the treasury for 23 years to continue to do so in the face of this massive wealth.
Elections are less than 30 days away.
Granger remains the best bet to take the country beyond the Politics of the past.
