Latest update March 22nd, 2023 12:59 AM
Mar 19, 2023 Editorial
Kaieteur News – Panama just went where Guyana refuses to go, and did what the Government of Guyana insists should not be done, is not doable. The Government of Panama and First Quantum of Canada announced earlier this month that a finalized draft concession agreement for the Cobre Panama mine has been reached. It was a long and hard road, but an agreement between the Panamanian Government and the Canadian Company is almost a done deal. What happened in Panama with its copper and a tough confrontation with a stubborn Canadian corporation must stand as a lesson for Guyana with its oil and America’s ExxonMobil refusing to budge.
The Panamanians were unhappy with their original copper deal with First Quantum Minerals, the parent company of Minera Panama. The Panamanian Government wanted more money in royalties and taxes, more environmental safety, and better labor standards. A draft was shared between the two parties in January 2022. First Quantum dug in its heels and rebuffed the demands of the Panamanians leading to a war of wills. In the latter part of December 2022, after almost a year of no movement by either side, the Panamanian Government acted with the power and strength befitting a sovereign nation, and ordered First Quantum to pause operations at the massive Cobre Panamamine. In February, port loading operations from mineral stockpiles were ordered halted.
It is what governments peopled with uncompromised and fearless political leaders are able to do, as they fight for better for their citizens. Not some wishy-washy, cowardly, suspiciously convenient leadership postures and words about ‘investor return’ and ‘investor confidence.’ Or ‘sanctity of contract’ which was also in place in Panama, but which has since been overturned.
All of those elements are important and have their place, but fairness for those who own rich natural resources as part of their national patrimony must always be the first consideration. That must be nonnegotiable, and never a point of debate. This is especially so, and immovably so, when the lopsided is being lived with, like the ExxonMobil’s odious contract that tricks, traps, and cheats Guyana. Any self-respecting government, any set of leaders with minimal honesty and the honorable in them, would move with strength and strategy to change what is highly unfair, totally unacceptable.
When we study the developments in Panama, and the actions taken by that country’s government, we point to all that is being done wrong here, what the PPPC Government and its leaders shrink fearfully from doing. The stoppage by the Panamanian Government was no small matter, as the mine represented 3.5% of Panama’s GDP, and US$10B in investments by Canada’s First Quantum, with more billions planned. Even Canada’s Trade Minister got involved in exchanges with her Panamanian counterpart, with negotiating in good faith and dispute resolution key objectives for both sides.
The demands of the Panamanians were simple: First Quantum was benefiting immensely from its Panamanian operations, and this made matters “more unfair” given the company’s “very low” tax liability, and other lucrative pluses (U.S. News & World Report -December 23, 2022).Thanks to the courage and integrity of Panamanian Government leaders, there is a draft concession agreement. It is subject to a 30-day public consultation process and approvals by the Panamanian Cabinet, Comptroller General of the Republic and the National Assembly. The proposed concession contract will be fora 20-year term, plus a 20-year extension option and additional extensions for the life of mine.
First Quantum CEO, Tristan Pascall commented, “After a lengthy and arduous negotiation process, the finalized Proposed Concession Contract outlines the basis for the future of Cobre Panama for all stakeholders, including the Government, our investors and the country of Panama. “We now await formal approval of the Proposed Concession Contract and look forward to a long and constructive partnership with the Government of Panama for many years to come.”
Leaders in the PPPC Government (President Ali and Vice President Jagdeo), and those of ExxonMobil (CEO Woods and Country Head Routledge) must work on a good faith basis to get to this point of mutual agreement for mutual benefits and mutual satisfaction. Continuing with what heavily benefits one side only (ExxonMobil) risks rupture and the rage of the Guyanese people.
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