Western hemisphereGuyana: Ethnic Politics and a Coming Oil Bonanza
Guyana’s president David Granger on Wednesday announced that the earliest day for the delayed parliamentary elections will be 2 March 2020, around the time that ExxonMobil plans to launch offshore oil production which will transform the country’s economy. The ruling People’s National Congress (PNC) party faces a tough challenge from the main opposition People’s Progressive Party (PPP), which runs on a platform that promises to toughen the terms of the large oil production contract.
In a recent interview on the Investing News Network, Remi Piet, senior director at Americas Market Intelligence, noted that despite being lumped together geographically and by name, the three Guianas of South America are noticeably different than one another.
Guyana (formerly British Guiana), Suriname (formerly Dutch Guiana), and French Guiana have each followed different paths in economic and political development since gaining independence, with each presenting investors with unique opportunities and challenges.
Investing News reports that Piet talked about the current situation on the ground, and the potential future of the three territories.
In Guyana, major oil company Exxon Mobil has major interests in offshore drilling, which Piet said have the potential to make the country “the new Qatar.”
“(ExxonMobil) is planning to produce 120,000 barrels of oil per day, starting in 2020. That means that (Guyana) is going to go from underdevelopment, to an extreme level of economic growth which it has probably not foreseen, and its domestic institutions are not ready for such a change in terms of its economic development path.”
Piet noted the political ramifications of the discovery and what lies ahead of Guyana when it comes to future development. In anticipation of the new oil riches, Georgetown, the country’s capital, has been gripped by political scheming and dealings.
“That example shows you the kind of politics and corruption that exists in Guyana — a country which is probably one of the least developed in the western hemisphere,” said Piet.
In Suriname, mining has made the news following the death of an illegal miner on an operational site owned by Canadian mid-tier producer IAMGOLD. The company has seen flow-on effects in revised guidances and dismissed contractors.
Piet noted that Suriname is set apart from its neighbors to the east and west by the presence of large operators, and a leader — Desi Bouterse — with close ties to the “informal” mining industry.
In French Guiana, Piet says, the industry is guided by the regulations of the European Union, and French politics loom large.
Listen to the interview above for more insights on the diverse range of scenarios seen in the Guianas.
