Govt on right path in preparation for oil and gas sector- world renowned expert Sir Paul Collier
DPI, GUYANA, Wednesday, March 21, 2018
World-renowned expert and Professor of Economics, Sir Paul Collier speaking at a high-level ministerial caucus today commended President David Granger for having the right vision as it relates to the impending oil and gas sector, specifically the plan for the establishment of the Sovereign Wealth Fund.
Sir Paul Collier, Professor of Economics, Oxford University.
Trusteeship and prudent management, Sir Paul noted are indicators that this Government has begun on the ‘right foot’ in relation to its preparatory measures. He also advised the Government that oil and gas sector revenues be transformed into assets for future economic development.
According to Collier, transforming oil, gas and mineral wealth into sustainable development requires a complete chain of economic decisions and strong foundations of good governance. In the local context, the expert said, these decisions span a number of ministries, each having a role to play in the process.
Guyana, he noted has a unique opportunity of ‘getting it right’ by employing a simple strategy of how the monies accrued will be utilised for creating jobs and other opportunities for its people.
He cited the example of Norway and Britain, where Norway invested in assets and had a successful industry, while Britain did not and failed. Guyana can learn from the experiences of these countries, Sir Paul emphasised. He explained that good decision-making rests on a foundation of rules, institutions, a critical mass of informed citizens and an authorising environment.
Hence, education is a priority area for building the sector, he added. Skilled people, electricity and good connectivity were listed by the professor, as practical suggestions to ensure the sector’s viability.
From Right- H.E. David Granger, President of the Cooperative Republic of Guyana, Hon. Carl Greenidge, Acting Prime Minister and Minister of Foreign Affairs, Sir Shridath Ramphal, Caribbean Statesman and Advisor and Hon. Raphael Trotman, Minister of Natural Resources.
Volatility, obsolescence and depletion are key areas for consideration, Collier said. Due to price volatility, he is advising that the country invests in liquid assets that are not correlated with the commodity or the economy since their value will depreciate over time.
Communicating with citizens is a key component in the process, therefore Collier urged that the Government builds consensus and harness a common sense of purpose to ensure the success of the new industry. Explaining the national strategy, he opined that fostering an atmosphere of transparency is also critical.
Sir Paul Collier is a professor of Economics and Public Policy in the Blavatnik School of Government at the University of Oxford. He is also a director of the International Growth Centre, the director of the Centre for the Study of African Economies, and a fellow of St. Antony’s College, Oxford.
This caucus is expected to lead to further similar engagements in a scheduled and programmatic way in the months ahead.
The Government’s objective is to move preparations to a deeper level of engagement on issues such as prioritising spending on infrastructure, agriculture and social programmes, inter-generational savings, geo-political considerations, legal and institutional strengthening, benefit sharing and engagement and involvement of the people of Guyana, to name a few.
The event was facilitated by Chatham House and the Royal Institute of International Affairs through its New Producers Group.
By: Stacy Carmichael