With just over 750,000 people, Guyana – South America’s newest petroleum hotspot – will begin producing oil within months and with over 6 billion barrels already discovered, revenue from production could profoundly transform the small nation. But the country has a challenge; unifying its population around one cause, and that is how the coming billions in oil revenue will be managed.
The multi-racial country is largely made up of persons of Indian and African heritage, each representing the two largest blocks of the population. Traditionally, the two main political parties have been mainly comprised of Africans and Indians with each perceived by the other as primarily representing their respective group. With these divisions come suspicion and this has played a major role in Guyana’s politics for more than half a century.
Now, with what Rystad Energy has said amounts to more than 117 billion US dollars coming its way over the next decades from just 13 of the total 16 discoveries made offshore to date, consensus on how the revenue is managed is the only way the country would be able to fully benefit from oil.
“There needs to be a shared vision for how the monies will be used to develop the country and I called on the political opposition to rethink its position on non-engagement with the Government,” Guyana’s natural resources minister, Raphael Trotman, said just this week at an oil and gas forum in Georgetown.
Political tensions in the country has been exacerbated by a no-confidence vote which was passed against the government in December. This should have triggered early elections three months later. A number of factors, including a court challenge to the validity of the vote, delayed the elections, which is now set for March 2020.
But even with decades of mistrust between the major political parties, there seems to be agreement on all sides about what is required for Guyana to truly benefit from oil revenue.
Leader of the Opposition, Bharrat Jagdeo, told reporters at a press conference in May that full inclusivity in the management of oil revenue will ensure benefits reach a wide-cross section of people across the country. He said regardless of the outcome of the next election, his party believes the country will only see meaningful benefits from the oil and gas sector if stakeholders representing Guyanese across the political divide have a say in how the billions of dollars expected in the coming years, is managed.
“We would like to see the sector… managed in a bi-partisan way where it rises above politics and that the resources are used to benefit all Guyanese,” he said.
With at least the appearance of political will on both sides to establish a bipartisan mechanism for how oil revenues will be spent, both government and opposition, together with civil society, must now take decisive steps in ensuring its people can truly benefit from the country’s new-found wealth.
