Latest update April 19th, 2024 12:59 AM
May 29, 2019 Letters
DEAR EDITOR,
In recent decades, we have witnessed a global trend of increasing experiments with green sources of energy in response to cries of impending doom due to global warming.
Guyana has been at the forefront championing green energy within the Caribbean and Latin America. Notwithstanding its role as a leading green activist, Guyana is on the verge of extracting oil and gas from under its Atlantic waters. Many commentators have considered the move as defeatist double standard, especially since ‘green economy’ has been receiving less attention, or as we say, ‘put on the back burner’ under the current government. Further, concerns have arisen about to proper use of the anticipated windfall revenues in the hands of a failed government.
In a world experiencing unprecedented changes, there is no doubt that from a local perspective, Guyana, and Guyanese stand to derive great financial benefits from the extraction operations. In fact, the economy is likely to benefit from about US$15 billion annually for several years.
This sum represents about four times the current annual earnings. However, the trickle down broad based benefits rest on the presumption that the windfall gains would be properly managed, invested and distributed. A good example of such failure is the gold and diamond windfall revenues. We have had record high production, with an average annual 19 percent declaration moving up to 33 percent at a time when we also enjoyed the highest prices paid for gold.
The price of US$370 per ounce moved up to US$1,700 per ounce due mostly to high demand during the recession; as world commodity prices for goods fell, investors sought stable/solid-value commodity – gold – to invest, which in turn, lead to the high demand. Yet little of the windfall gains trickled down to the populace, to this day.
Furthermore, we should be cautious and not lose sight of the possible downside of oil and gas extractions. Besides economic/business cycle boom and bust (or boom and doom), multiple negative impacts can potentially surface/occur in the coming years. Many commentators have voiced their concerns on the potential dangers of fracking operations, among which are spills, freshwater contamination, flora and fauna destruction and health issues. These concerns are potent.
Notwithstanding the glued attention to Exxon’s operations, Guyanese must pressure the government to refocus on green initiatives in both the short and long term. It would be wise to invest some of the windfall in this sector. Manufacturing, whether on small or large scale, requires reliable and cheap energy which can be sourced from renewable sources, especially hydro-power, solar and wind. In essence, our sustainable future rests on renewable sources of energy, which is also beneficial to our health and the reduction of global warming.
In a nutshell, while it may be okay to focus attention on the potential gains from oil and gas extractions, we should not forego/slacken our green economy initiatives. We stand to derive huge financial benefits, but are at risk of being in the new red zone should a mishap occur. At the same time, unless we stand guard and oversee the proper management and investment of the windfall cash, we, the populace, may remain poor amidst plenty, while the political circle expands by wolfing our wealth.
While welcoming oil and gas revenues, we must also forge ahead with our green initiatives.
Yours sincerely,
Ronald Singh
Where is the BETTER MANAGEMENT/RENEGOTIATION OF THE OIL CONTRACTS you promised Jagdeo?
Apr 19, 2024
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