USA, Guyana collaborate to ensure oil wealth does not land in private pockets
US Embassy’s Bryan Hunt
June 1, 2015 | By KNews | By Abena Rockcliffe
With promising indications that Guyana will soon become an oil producing country, the newly inaugurated government has begun talks with the United States of America (USA) with an aim to adopt the most suitable measures to secure the wealth that will be derived.
This was made known by United States Embassy Chargé d´ Affaires, Bryan Hunt during a recent exclusive interview with Kaieteur News.
President David Granger
Hunt explained that the USA wants to ensure that Guyana, “as a matter of priority,” becomes a candidate country for the Extracted Industries Transparency Initiative (EITI). The EITI is intended to ensure that all oil deals are transparent and the public is kept up to date with the wealth generated from such deals.
Hunt told Kaieteur News that his country has had preliminary discussions with the Granger government on how Guyana might transparently manage the financial resources generated, not only from oil and gas but from minerals and timber as well.
The Envoy said that the new government as well as the previous government was spoken to about the “need” for Guyana to become a candidate country for the EITI.
The EITI, as explained by Hunt, is the global goal standard by which governments can ensure that its country’s financial inflows from natural resources extractions are transparent to the public.
“In this way everyone knows what you (government) are receiving, everyone knows the terms of the contract and then civil society can be able to hold the government accountable to make sure that those resources flow into the state coffers and not into private pockets. So getting Guyana into the EITI is something that needs to happen on a priority basis,” said Hunt.
The US Envoy indicated that, in this regard, the Peoples Progressive Party/ Civic (PPP/C) administration had done some preliminary work with the Inter American Development Bank (IDB) “and some (work) with us.”
He said that the USA is prepared to continue to work with Guyana through the current government to put together a submission to the EITI for candidacy.
However, the Chargé d´ Affaires explained that the process for Guyana to become a candidate will be a very involved one as the country will have to demonstrate that it has adopted the right laws and the right stakeholder groups and so forth. “But we are going to work with them on a priority basis to move that ahead,” he said.
Also, the USA is advocating for Guyana to establish a Sovereign Wealth Fund (SWF) which President David Granger has already signaled his intention to do.
With regards to the SWF which President Granger spoke about establishing while he was in election campaign mode, Hunt said that the USA, as well as the broader International community, is supportive of this intention.
The USA representative said that this is the goal standard, not for the transparency of the inflows like the EITI will provide, but for the transparency of the management of the outflows of cash from oil generated wealth.
Hunt explained that with a SWF, all the revenue that is derived from whichever industries selected to be covered—weather oil, timber or gold—flows into this single fund.
He said that instead of spending this money immediately, government can then use that money in a sustained way to ensure that there are enough funds to govern the country not just immediately but for the long term.
Hunt noted that this fund comes in handy as the natural resources, which are always going to be finite, begin to run out.
The Envoy explained that a SWF guarantees a predictable budget stream over a long term period.
He noted as well that it also guards against the Dutch disease which is when the public sector inadvertently crowd out the private sector by dumping huge amounts of capital into the country.
“So I think it is important, and President Granger has the right approach in the principle that Guyana needs a sovereign wealth fund and I think we will all from the international community, agree with that basic premise,” said Hunt.
Hunt explained that all does not end with the agreement that Guyana needs such a fund, as the government now has to decide which structure will be used “because there is not one single model for a sovereign wealth fund, there are different models.”
Hunt explained that the different models will have different rates of expenditure. Different models can hold money onshore or offshore.
“Also sometimes you have multiple SWF; one for long term investment and one for short term growth. So there are a number of models that the government will need to consider.”
Hunt said that he is quite sure that the International community is prepared to work with the Granger administration to help explore the various options “as there is not a so called right answer to this question. It’s a policy choice that the government will need to make in the best interest of the country.”
He said that the US hopes that there will be public forums to ultimately decide on and adopt a model that “people believe will work best to ensure the long term sustainable management of resources here in Guyana.”
Comments
“USA, Guyana collaborate to ensure oil wealth does not land in private pockets.” Isn’t Exxon a private corporation albeit on govt welfare, which means that oil wealth is going to go into private hands. Yes, the fat grubby hands of these gluttonous folks, with a few crumbs, that manage to fall out for their overstuffed mouths, going to their servants tasked with spoon feeding them their ill gotten gains. Sadly the Guyanese people like the Nigerian people like the Iraqi people like the Libyan people like the world’s people, whose resources are being pillaged and plundered every where and every day, will not receive any of the wealth.
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See below for the American reality that Guyana resources have to support. Mind you, these are not the folks on welfare. People on welfare are not generally counted in these configurations. These are most likely the people who work for the likes of Exxon and are paid paltry salaries coupled with regressive taxes that leave them poor, but they feel they ought to be rich because they work for a wealthy corporation and American exceptionalism says they cannot be poor in the richest and greatest country in the world.
“53% of Americans can’t come up with $400 in a pinch. But 65% of Americans think they’re doing well financially. Who exactly are these 12% who don’t think being poor is, you know, being poor?”
http://www.smirkingchimp.com/thread/ted-rall/62464/cartoon-for-june-1-2015-the-dumbest-12
I said this before and I will say it again.
The GREAT WHITE SHARKS have finally invaded Guyana’s waters.
These white sharks are not here to help the Guyanese People; they are here to
exploit our natural resources while at the same time pollute our shoreline and
coastal waters. They have not made a new discovery that we did not already know exist.
The Venezuelan authorities invented a false claim on our territory as a delaying tactic so that they could extract as much oil as possible near our borders.
(Thou shalt not COVET)
Remember what the expatriates did to our other natural resources,
Bauxite, Manganese, Gold, Diamond, Forest and agricultural products etc. How much did Guyana benefit from their presence and exploitation here? Have we forgotten how they enslaved our forefathers? Have we forgotten that while these great white sharks were having huge feasts our forefathers and off-springs were fed crumbs and stale meat and salted fish?
Have we forgotten that they were the ones who pitted the two major races against each other – divide and conquer strategy?
Have we forgotten our history? What did they do to our fore fathers, our
dollar and the exchange rate is so shameful, are we willing to forget these?
Mr. President, before you ever sign any agreement with these
expatriate crooks at Exxon Mobile please take the time to delve into the
history of this and other oil companies. Make sure that such agreement receives public scrutiny. We Guyanese are not dumb asses as they made us out to be. We have come a long way in the field of education.
In the USA they rake in Billions of dollars in profits while
at the same time use loopholes to garnish billions more in Government
subsidies, taxpayers money, besides manipulating prices at the pump to maximize their profits.
To add insult to the intelligence of the populace they damage and destroy the roads and other infrastructure with their heavy vehicles and have the nerve to expect the taxpayers (through additional fuel taxes) to foot the bill for the repairs while their profits explode to the highest degree. Yes, these fat cats in the oil industry are rolling in wealth at the taxpayers expense.
Besides, they do not care about the environment. Exploding trains, fuel tankers, broken pipelines, leaking rigs and fuel tankers; and environmental pollution mean nothing to them. Poisoning waterways with their toxic waste, polluting the air with toxic emissions from the chimneys of their refineries, are of little concern to them (all oil companies) Destroying fertile agricultural lands with synthetic fertilizers (by-products of the oil industry) inclusive. All that they are concerned about is the huge profits they can generate while the poor working class have to figure out where their next meal is coming from. Are these the the people we are enticed to do business with? I think not and there are millions out there who share the same concerns too.
If someone comes up with an invention that can generate much
cheaper electricity without the use of fossil fuel, or if someone invents an
engine that can run on water instead: their inventions are not allowed to see
the light. Besides, they are either murdered or their inventions are destroyed or confiscated or their lobbyists ensure that no progress is made in any invention that will benefit the masses at the demise of oil. There are tons of evidence on these matters now available, thanks to the age of modern technology.
IS THIS WHAT WE WANT FOR OUR COUNTRY AND OUR PEOPLE? Are we so dumb as to forget what our forefathers went through in the hands of these expatriates before we gained our independence and kicked them
out? Are we going to allow history to repeat itself?
Mr. President, you are the new MOSES of our people. You and
your cabinet are tasked with the responsibility of uniting our people, to break
the yoke of Babylon hanging around our necks, find a way to extricate our
people from the claws of the IMF, the World Bank and all those institutions
that sink their teeth into our Nation’s Natural resources and our peoples life
blood.
The united States Government is one of the most corrupt in the world.Oil Money talks. Politicians are bought out left right and center. Beware Mr. President, of the wolves in sheep’s clothing. Beware that you and your cabinet are not victims to these greedy corporations. Examine every clause of any contract presented to your Government and look for the embedded “CLAWS”. Look out also for traitors in your entourage – the sly Judases. Ensure that we get a fair deal – people oriented. Poverty is not our inheritance. Our wealth was stolen from us. This wrong must be put right.
Beware of their “SWEET TALK” and get the people’s input in this bold step forward for the benefit of our people. Our environment, our integrity, our sovereignty, our natural resources, MUST be protected at all cost.
So,must we seek to attract foreign investment only from non-US sources? Or not at all? Any other country following this advice?
Please re-read the last two paragraphs of my input. We must not allow any foreign corporation or government to impose their dictates upon us.They have a way of sheltering under the umbrella of fine prints to safeguard their crookish agenda. They need our resources, hence it is pertinent that we demand a fair share of the returns for the benefit of all our people.
Not all doom and gloom, maybe the government should take a look at the Nordic countries. Have billions, saved, with Norway leading the way. Great promise