‘Guyana doesn’t even need an oil industry’

By Neil Marks

If Guyana were to satisfy a portion of the Caribbean’s food import market, it would generate sufficient revenues to run the country, Senior Counsel Ralph Ramkarran, former Speaker of the National Assembly has suggested, as he warned against dependence on the developing oil and gas sector.

According to the Food and Agricultural Organisation (FAO), CARICOM’s food import bill skyrocketed from just over US$2 billion in 2000 to US$4.2 billion in 2011.

The FAO projects that food imports would increase to US $8-10 billion by 2020 if current efforts towards reducing the food import bill are not successful.

“Guyana doesn’t even need an oil industry…we just need 1/6 of that market –  and we are capable of that market,” Ramkarran said Tuesday at an event organised by the Georgetown Chamber of Commerce.

Guyana’s national budget in 2016 was US$1.1 billion.

Ramkarran said that Guyana should maintain and even further grow the traditional sectors, which are often referred to as the Six Sisters, namely rice, sugar, bauxite, gold, diamonds and timber.

Further, he said that the development of other sectors should be pursued.

“There is the tourism Sister, there is the IT Sister – there is all kind of sisters that are capable of being generated in Guyana,” he stated.

He said that dependence on an oil industry and a service industry could put pressure, for example, on the availability of foreign exchange. Ramkarran cited Trinidad as an example, noting that when Trinidad was earning its highest income from oil, foreign exchange was hard to get.

“So my recommendation to a business organisation (addressing the GCCI) we need to add value to these Six Sisters.

“We need to expand our agricultural base; we need to go into agro-industries and we need to make our exports of agriculture as valuable as our export of oil – and it is possible,” he stated.

Almost all CARICOM countries import more than 60 percent of the food they consume, with half of them importing more than 80 percent of the food they consume.

Only three countries (Belize, Guyana, and Haiti) produce more than 50 percent of their consumption.

In September last, President David Granger said that “…Guyana has depended on sugar and rice, bauxite, gold diamonds, timber –  they have been faithful to us over the years but some of them are tired now.”

He added: “We need to diversity, we need to get away from the spell these sisters and ensure that our children have a future other than being cane cutters, our children have a future than felling timber.”

While noting how transformative the oil sector will make Guyana, he emphasised that Guyana must go into new industries.

The FAO has stated that Caribbean’s high food import bill impacts foreign exchange levels, budgets for social protection programmes, levels of chronic non-communicable diseases and displacement of local production.

“The region needs a comprehensive strategy which invests in more efficient food production systems, import substitution and consumer education and brings together the private and public sector,” the FAO stated in a brief in October 2013.

Processed foods, grains (wheat and corn), and livestock products (meat and dairy) are among the top five food import categories in the Caribbean, accounting for over US$ 1 billion or approximately 25 percent of annual food imports regionally, the FAO noted in a 2015 report on the state of food insecurity in the Caribbean.