Are huge foreign investments a nemesis for some people? By Dr. Prem Misir Partisanship has become a staple diet in Guyana’s politics. And the partisanship is more impacting where politicians live off politics than politicians who live for politics. Those who live off politics are those who are inclined to always believe that their point of view is the only correct one and where that point of view invariably has little or no basis in evidence-based data and information. Indeed, not only politicians who live off politics feel that their opinion is sacrosanct even if not backed up by evidence. There are others outside of this political fold who present viewpoints as if they are God’s words. For instance, on the Amaila Falls Hydropower Project (hydro), the critics dictate that electricity charges to consumers will not be reduced when the hydro reaches completion, notwithstanding an abundance of estimates that shows otherwise. I will provide an example that I used in last week’s Perspectives where I presented Herz and Kubeck’s press response in February 2012 to the critics’s concerns. Drawing from Herz and Kubeck, I noted that “…at 2018 when the hydro is online, GPL estimated savings will be US$91 million after GPL would have paid its tariff; these savings are estimated on the basis that GPL would use fuel in 2018 at $115 per barrel crude oil. And given that Guyana does have the hydro, in the first 12 years, GPL will have savings of US$991 million or 40%, between years 13 and 20, savings will be US$1.15 billion or 71%, and beyond year 20, savings will amount to US$ 14.8 billion or 91%. I suspect that the predictable fluctuating and erratic global oil price increases will further increase GPL’s savings to its customers.” Why are Herz and Kubeck’s response not accepted by some critics on this particular concern on reduced electricity charges to consumers? Why the Guyanese people have to be overwhelmed with the hydro critics’ numerous daily media propaganda pointing to zero savings to electricity customers without decisive evidence? Several critics on concerns on the hydro pen letters almost daily to the press as if they are columnists for those newspapers. Opponents of the hydro continue to publicly present their notions on why the hydro is a lost cause for Guyana. For instance, there is a concern on the possibility that Sithe Global would have borrowed from China at 8.5% and that perhaps the project sponsor would have had better financing with the World Bank. These concerns are unfounded. The rate on paper from China was not 8.5% but was more like 7.2%, and that rate could vary until negotiations are fully completed. And the Government of Guyana did approach the World Bank, but it was not favorable to hydro projects at that time. Even the International Finance Corporation (IFC), part of the World Bank grouping, expressed little interest. Another concern raised is that Guyana may not have an energy policy. The policy may be rather dated, but there is an energy policy, and which could be subject to review. The energy policy was formulated in July 1994 and was ratified by the Cabinet. The central part of this policy was the replacement of fossil fuel with local renewable energy (refer to the National Development Strategy, Chapter 39, the energy sector, April 3, 1996). This whole charade with the hydro is almost déjà vu. Remember the Beal Aerospace Technologies’ attempt to install a satellite launching site in Guyana. It was true that the U.S. State Department had concerns about providing the green light to Beal. But at that time, too, just like the current charade with the hydro, there were many local concerns about the Beal deal. Opposition politicians and others felt that the Government was disposing of their natural resources cheaply. This matter also went to the High Court. In the end, there was no Beal deal and no huge foreign investment for Guyana. Are some people uneasy with huge foreign investments for Guyana? Are such foreign investments becoming a nemesis for them?
Posted on: Tue, 20 Aug 2013 15:52:01 +0000
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