Corruption and Dutch disease

Oct 08, 2021 Letters

Dear Editor,

There have been incessant cries of doom from a certain media house and other oil and gas ‘experts’ and they have been churning out ill-conceived and outrageous statements about non transparency, unaccountability and corruption in our fledgling oil sector. The manner in which this is peddled would make the gullible believe that we are on par with Nigeria when it comes to corruption. This example is now abused.
Let us look at Nigeria, for instance. The Nigerian government has earned over US$400 billion since 1970. It is worthwhile to note that oil earnings comprised 85 percent of government revenues and 99 percent of export earnings. It is also important to note that according to reports, ‘oil wealth fuels the instability, corruption and patronage-driven politics which characterises governance in the country’. Matthew John wrote, ‘Corruption runs through every level of Nigerian Government. From massive contract fraud at the top, through petty bribery, money laundering schemes, embezzlement and seizing salaries from fake workers, it is estimated that corruption within the state apparatus costs the country billions of dollars every year’.( Campbell, Page, John, Matthew (2018). Nigeria: What Everyone Needs To Know. New York. pp. 89–103.)
The reason why this high level of corruption exists in Nigeria is because, ‘these gas industries are under the control of the state-owned Nigerian National Petroleum Company (NNPC) and many politicians own or have shares in this industry. Tax revenues from the energy sector are diminished and the benefits from Nigeria’s energy wealth are not evenly distributed throughout the country but with Lagos State benefitting disproportionately’. This avenue does not exist here and does not pertain to Guyana. We collect our share of oil profit which is subject to audit and this Government has made it clear that our oil wealth will ensure that the socio-economic development takes precedence. In other words, the other sectors will not be allowed to retrogress and infrastructural development will continue to be a priority.
It must be noted that Guyana receives 50 percent of the profits from EXXON and this revenue is not unaccounted for and available for corrupt practices. The receipt of oil revenues began in February 2020. Moreover, the Local Content Policy ensures that Guyanese receive a fair share of the oil takings. The primary aim and objective of the Policy is ensuring the education, inclusion, and advancement of as many as possible in the value chain of the oil and gas industry. This Government is spending our monies wisely and with great prudence unlike the Coalition, which spent close to 2 trillion dollars with nothing to show.
We should recall that the US$18 million bonus was a mystery, and it was nearly siphoned off by the Coalition after many denials and excuses. This is not the case with this Government. I will agree that if the Coalition was still in Government there would have been a similar scenario as Nigeria. The corruption of the Coalition started since the signing of the PSA and that would have continued to grow and fester with each receipt of oil revenue. The PPP/C Government rescued Guyana from being somersaulted down this corruption abyss. No wonder the Coalition fought relentlessly to stay in power. Guyana is different. There is such a Natural Resources Fund which was set up in 2019 by the Natural Resources Act in accordance with the Santiago Principles. It must be noted that to date not a dollar from the oil revenues has been spent which would have amounted to nearly US$500 million.
The naysayers need to come to reality, that this Government has so far been implementing both short-term and long-term policies which will ensure that Guyana will never suffer from the Dutch Curse or Disease. Oil and gas as well as the other sectors are vitally important, and this Government has been ensuring that that emphasis is fostered. Our real GDP is growing as is evidence by the Mid-Year Report which showed 14.5 percent despite the vicious pandemic and the catastrophic floods. In conclusion, it is time for all Guyanese to support the developmental thrust of this Government and stop making unsubstantiated and misconceived assumptions.
Yours sincerely,
Haseef Yusuf

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