Guyana, Geostrategic Entrepreneurialism and Energy

Must Read

OilNOW
OilNOW
OilNOW is an online-based Information and Resource Centre

By Scott B. MacDonald – OilNOW

The global political and economic system is in flux, driven by climate change, a transition from fossil fuels to renewables, and a new Cold War between the United States and China. Another factor creeping into this mix is the revitalisation of the Global South, countries that are largely situated in the world’s southern hemisphere.  Key to the recent revival of the Global South is the re-emergence of the BRICS (Brazil, Russia, India, China, and South Africa) as a force in international politics and economics.  While the Global South’s return to the headlines should not be overstated, it adds to the complexity of the international system. It also benefits many countries in the Caribbean, in particular Guyana, the newly minted petroleum state.

In the not-too-distant past, many countries, Guyana included, were not at the top of the list of places where large and important countries sent their top-of-the-line diplomats, let alone heads of state. For Guyana, it was not until 2020 that Mike Pompeo became the first U.S. Secretary of State to visit Guyana. That was then; this is now.

Guyana’s leadership is having a busy 2023, hosting and being hosted by a wide range of countries, usually to discuss energy, trade, and investment opportunities. In January 2023, President Ali Irfaan visited India, which was followed in February by Vice President Bharrat Jagdeo, discussing many of the same matters. In April, India’s foreign minister visited Guyana. In June, Ali visited Qatar, where he inaugurated a new embassy. This was followed by Ali’s attending the Union of South American Nations (UNASUR), where he met with fellow regional heads of state, including President Luiz Inácio Lula da Silva (a BRICS member). In the same month, Ali was visited by the Dominican Republic’s President Luis Abinader. Early July saw the Guyanese head of state traveling to Trinidad and Tobago to take part in CARICOM’s 50th anniversary, while in early August Guyanese representatives attended the meeting of the Amazon Cooperation Treaty Organisation, held in Brazil.

Meanwhile, Guyana is not being ignored by China and the United States. In early July U.S. Secretary of State Anthony Blinken visited Guyana, where he met with President Ali and stressed the shared priorities of strengthening democracy in the Americas, dealing with the global climate crisis, and creating more inclusive economic opportunities. Following Blinken’s visit, the Guyanese leader was off to China to attend the opening ceremony of the 31st FISU World University Games. While there he met with China’s President Xi Jinping. The Chinese leader indicated that his country is willing to deepen the alignment between its Belt and Road Initiative and Guyana’s Low-Carbon Development Strategy 2030.   

Guyana’s newly prominent standing in international circles reflects what some are calling a shift from the post-Cold War age of the U.S. being the only superpower to a more multipolar world with a menu of new alliances now being offered. The Financial Times’ Alec Russell captures the essence of this: “The stand-off between Washington and Beijing, and the West’s effective abandonment of its three-decade dream that the gospel of free markets would lead to a more liberal version of the Chinese Communist Party, are presenting an opportunity for much of the world: not just to be wooed but also to play one off against the other – and many are doing this with alacrity and increasing skill.” Guyana is one of those countries taking advantage of what some are calling “geostrategic entrepreneurialism”. 

Guyana’s geostrategic entrepreneurialism reflects similar drivers of many countries in the Global South. These include making certain that Guyana matters in global and regional affairs (which is helped by Guyana’s prodigious oil and gas reserves); not being forced into picking a side in the new Cold War between the U.S. and China; and striking the best economic deals that it can with the view of improving the living standards of the population, dealing with climate change challenges and more broadly diversifying its economic base and trade partners. 

While the revival of the Global South idea has upsides, there are also downsides, such as the possibility that the BRICS (with expanded membership) will assume an increasingly anti-Western tone. The organisation has already created the New Development Bank, which purports to be more in tune with the needs of developing countries as opposed to the IMF and World Bank. China and Russia, two of the more anti-Western countries, are central to the organisation; and there is interest in doing away with the U.S. dollar as the primary international currency. At the same time, the political faces of the BRICS, except for Brazil and to some degree India are autocratic. Even the new members – with the exception of Argentina – are authoritarian. Not that Guyana is going to sign up as a member of the BRICS, but the tone of the Global South does not favour the democracy brand and is increasingly in opposition to the U.S.—Guyana’s main trade and investment partner and a key diplomatic supporter in fending off Venezuelan claims for two-thirds of the country. At the same time, two of the major external supporters of Venezuela are China and Russia.

Thus far, Guyana has played its hand at geostrategic entrepreneurialism relatively well.  This has been achieved by a combination of active diplomacy that courts both China and the United States, but is giving space to other countries – India, Qatar, Saudi Arabia, Singapore, and UAE – chances at investment and trade opportunities. At the same time, Guyana is gradually becoming a more important partner for other Caribbean states, including the CARICOM countries and the Dominican Republic. Oil plays a large role in this. As President Ali recently stated, “And sometimes, I say that maybe what drives public following is the oil and gas sector, because since oil was discovered, we have seen a very welcome interest from the global community on Guyana.” Geostrategic entrepreneurialism is likely to remain central to Guyana’s economic statecraft, but the backdrop of the revitalised Global South raises some challenging questions. 

About the Author 

Dr. Scott B. MacDonald is the Chief Economist at Smith’s Research & Gradings. He is also a fellow at the Caribbean Policy Consortium and a research fellow at Global Americans. His most recent book is The New Cold War, China and the Caribbean (Palgrave Macmillan 2022). 

- ADVERTISEMENT -
spot_img

Partnered Events

Latest News

Guyana’s Denzel Southwell makes history as nation’s first local offshore driller – El Dorado Offshore 

See release from El Dorado Offshore Inc.: Denzel Southwell's journey is one that defies expectations. Hailing from the small...

More Articles Like This