Latest update April 18th, 2024 12:59 AM
Sep 01, 2019 Features / Columnists, Peeping Tom
People have wondered why it is that there has been no public outrage against the oil deals which were signed by the APNU+AFC government. Not a single protest has been launched against these deals.
It is not that the Guyanese people do not understand that these deals constitute the biggest rip-off in history. They know that. This newspaper has been in the forefront of exposing the scandalous deals signed in 2016.
But the political leadership of Guyana is controlled by middle class and oligarchic political interests. And they will ensure that they benefit from these deals, and therefore they are not interested in protesting on behalf of the poor and working classes.
The poor have little to get. By the time oil production commences, cost recovery would have dented what Guyana has earned. And it is this little which the middle class wants to control.
Oil production in the Orinduik Block has not yet started, but already the costs have begun to oil up. This newspaper is reporting that Tullow, a British oil company, has billed Guyana some G$64M in pre-contract costs.
To this latest bill must be added the US$460M pre-contract costs racked up by ExxonMobil for its work, prior to signing the 2016 contract. Since then, there would have been contract costs and Guyana can end up being in debt to the tune of more than US$ 2 billion even before a drop of oil begins to flow.
From its oil share, Guyana has to pay pre-contract costs. It also has to pay the costs of producing the oil, which is known as operational costs. A number of other costs have to be paid also, by virtue of the contract signed by the government.
If the oil companies drill a well and it is empty, then the cost associated with that empty well is apportioned to the costs for the wells that are producing oil. This is because Guyana’s brilliant government did not incorporate ring-fencing arrangements into the contract.
Guyanese therefore had better lower their expectations about oil wealth. There is not going to be that much coming their way, and the monies that will come will be deposited into a natural resource fund which will then ration what can be spent.
But it gets worse for Guyanese. The government is saying that it will restore free university education. But where will the money come from for free education. This is not difficult to answer. It will come from the oil revenues.
University education is elitist. It caters for less than 1% of the population. And 80% of those graduating from university find their way overseas. In other words, Guyana is unable to benefit from its investment in university education, because 80% of its university graduates opt for greener pastures.
In 1996, the National Development Strategy found that one quarter of secondary school expenditure was being spent on a single school and for CXC examinations. That school was the President’s College, which was a residential school. What this shows is that trying to keep this single school going was depriving teachers of decent wages. Instead of scrapping this burden on taxpayers, the government found that it was unable to do so, because there was opposition to closing a school built by the Founder Leader.
Then, it was one school that was haemorrhaging the educational system. Twenty-five years later, it will be one institution that will be creaming off much of our oil revenues – the University of Guyana.
The University of Guyana is a factory, which churns out Guyana’s professional middle class. It is therefore this class, which will benefit more from Guyana’s oil wealth than the poorer classes. And they will do so because the middle class controls the APNU+AFC government.
The middle class will continue to benefit in the future, because they also dominate the leadership of both the PNCR and the AFC. This is why there has been such stern resistance to the WPA’s proposal for cash grants to families. Not that there was much money to finance the grants in any case. But the resistance is because the middle class, which dominates these two parties, decide the policies of the parties and government, and they intend to ensure that their class benefits from it.
Yet the working classes will come out in their numbers next year to vote for political parties, which act against their own interests. There is no working class party in Guyana at the moment. The working people, however, are too blinded to see this. They see another variable: race, and this is what drives them into the respective political camps.
The little which will be thrown Guyana’s way by the oil companies will be swooped upon by middle class interests. And for the poor man, it will only amount to an egg ball every month. The middle class would have creamed off the two other loaves of bread.
(The views expressed in this article are those of the author and do not necessarily reflect the opinions of this newspaper)
JAGDEO ADDING MORE DANGER TO GUYANA AND THE REGION
Apr 18, 2024
SportsMax – West Indies captain Hayley Matthews has been named Wisden’s leading Twenty20 Cricketer for 2023, as she topped all and sundry, including her male counterparts. Alan Gardner looks...Kaieteur News – Compliments of the Ministry of Education, our secondary school children are being treated to a stage... more
By Sir Ronald Sanders Waterfalls Magazine – On April 10, the Permanent Council of the Organization of American States... more
Freedom of speech is our core value at Kaieteur News. If the letter/e-mail you sent was not published, and you believe that its contents were not libellous, let us know, please contact us by phone or email.
Feel free to send us your comments and/or criticisms.
Contact: 624-6456; 225-8452; 225-8458; 225-8463; 225-8465; 225-8473 or 225-8491.
Or by Email: [email protected] / [email protected]