Latest update March 29th, 2024 12:59 AM
May 16, 2019 News
By Kiana Wilburg
Local Financial Analysts such as Anand Goolsarran and Christopher Ram have often called for the economy to be sufficiently diversified and become
more export-oriented in order to avoid overdependence on oil revenues.
But Finance Minister Winston Jordan firmly asserts that this is easier said than done. During a recent interview with Kaieteur News, the economist alluded to the fact that overdependence on oil revenues is virtually unavoidable in 2020, and even 10 years after, since the diversification of the economy will not happen overnight.
“Sometimes we behave as if getting more revenues is going to be a curse. But let me say this, you cannot diversify the economy overnight. It is not as simple as that. To even stay in sugar, it requires millions of dollars, and to make it competitive requires billions more. So we can’t be running around hollering that we have to diversify. We know we have to do that. But it will not happen in one or 10 years. We have to fix several things before that can happen.”
In this regard, Minister Jordan reminded that Guyana does not have the infrastructure that is needed to support investment outside of the extractive sector.
“We don’t have proper ports, road networks, bridges or cheap electricity. All these things have to be in place.”
In the absence of this, the Minister emphasised that the government cannot run to diversify the economy, as it would not be able to be competitive. Further to this, Jordan said that even the United Arab Emirates (UAE) was initially heavily dependent on oil revenues and, eventually, it was able to put in the required infrastructure and diversify. Jordan said that the UAE still depends on oil revenues, but not as much as it did to begin with.
“For a long time, petroleum revenues will trump other areas in Guyana, and we will try to put in the infrastructure to attract investment beyond the extractive sector,” the Minister concluded.
BECOMING VENEZUELA
Just a few weeks ago, PPP General Secretary, Bharrat Jagdeo, registered his dissatisfaction with the efforts Government says it is making to ensure the nation is not overly dependent on the oil revenues to come. He also bemoaned the fact that the government is yet to put forward its plans to diversify the economy.
“That is the biggest cause of worry and this is not as Opposition Leader; this is as a Guyanese I am speaking here. They (government) are peddling these rumours that we will do well with oil money, we will get rich and solve all our problems, but that is not so,” Jagdeo said.
He added, “Even if we get a lot of money, which we won’t in initial years, if we don’t focus on diversification, then we are going to become like Venezuela and others who produce oil and the people don’t have food. This is the problem with this government…”
The politician insisted that these matters need to be addressed urgently.
THIS IDIOT TELLING GUYANA WE HAVE NO SAY IN THE 50% PROFIT SHARING AGREEMENT WE HAVE WITH EXXON.
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