This is the second of my posts about oil in three countries where I worked previously and what is happening now after oil was discovered. The first country covered was Timor Leste, the next post will be on Ghana.
My last assignment in Guyana was as a distance education consultant on a Canadian funded teacher training project. That enjoyable work was spread over four years ending in 2002 and is a chapter in my book “Overseas Adventures – from Afghanistan to Zambia and Points in Between.” Back then Guyana’s oil had not yet been discovered. That changed in 2015.
Exxon Mobil found oil off the country’s coast in what is called the Stabroek Block named after Georgetown’s iconic market and bell tower. Other discoveries followed and Guyana has estimated oil reserves of 11-billion barrels making it comparable to countries such as Norway. Guyana currently boasts the fastest-growing economy in the world.
Spending its new oil wealth wisely
The Government of Guyana established a Natural Resource Fund in 2019 much as Norway did decades earlier from its oil and gas revenue windfall. The Government started spending from the fund in 2022 and initially focused on capital projects including roads, bridges, schools, hospitals and energy connectivity and expansion. According to an article in the E-journal, OilNOW,
“The Guyana government is on course to withdraw US$2.3 billion in oil revenue from its Natural Resource Fund (NRF) in 2025 to support that year’s budget. This would represent a 46% increase from the almost US$1.6 billion amount approved for use this year [2024].
Vice President Bharrat Jagdeo frequently stresses a preference for spending ‘for the future’, rather than on steep salary hikes. However, the government has promised that compound increases to salaries over a few more years will place key public servants like teachers and nurses on par with their counterparts in the developed world.”
Guyana on course to boost oil money spending by almost half in 2025 | OilNOW
This is encouraging news since migration of professionals from Guyana for many years previous was a serious problem. Indeed, I personally know of at least one lecturer at the Cyril Potter College of Education who retired early and took up a manufacturing job in Canada due to the relatively poor salaries in his home country. There were similar staff loss issues at the University of Guyana too.
Spreading the wealth around
An October 2024 article in the Jamaica Observer noted that the Government of Guyana is going to give USD 100,000 to everyone of its citizens 18 years and older.
$100,000 cash to every citizen above 18: Guyana spreading its oil wealth – Jamaica Observer
“In October 2024, the Mohamed Irfaan Ali Government in Guyana ramped up its already spectacular programme of spreading its new-found oil wealth by announcing it would provide a one-off cash grant of $100,000 to every citizen 18 years and over. That replaces the previous $200,000 to each household.
That is only the latest in a series of mouth-watering measures aimed at boosting disposable income for Guyanese. The Administration has already removed more than 200 taxes and fees, including value added tax (VAT) on water, electricity, and essential food items.
Additionally, there has been the removal of excise tax on fuel, saving consumers more than $90 billion annually, raising the low-income mortgage loan ceiling, and eliminating taxes on Internet services for residential and individual use.
Previously, the Government allocated $5 billion towards cost-of-living relief, providing public servants, teachers, members of the disciplined services, and staff of semi-autonomous agencies and public enterprises with a one-off $25,000 cash grant.
This month also, the Administration moved to adopt free education policies, starting with the abolishing of fees to all technical, vocational government institutions, as well as the University of Guyana (UG) in 2025. As a companion measure, $8 billion will be written off under the Government’s student loan write-off programme.”
As an education and training consultant who worked in Guyana on distance education and later helped develop a joint UGUY and UWI Certificate in Adult Education, my heart is warmed by the idea of no fees for students at TVET institutions and the University.
A few questions and a suggestion
As the giant oil producers in the Middle East have discovered, having oil can be a boon but countries must also plan for when the resource is used up. This idea is in keeping with the Guyanese VP’s premise to spend for the future. In my view, skills planning and development should play a key role and answers to the following questions are needed: What are the jobs of the future? What 21st century skills are needed? How can entrepreneurship be promoted? What is the best way for indigenous communities in the hinterland to improve their social and economic positions while sustaining their culture and the environment around them?
One suggestion on jobs is to make sure there are opportunities made available in the oil industry for local graduates, technicians and trades people.
