In this column, I will continue to explore the rationale of the PNCR’s economic policy since March, 2015. I noted in the previous column that a book on land settlements in Guyana, written by Minister Carl Greenidge, provides important insights into the thinking of the PNCR. We need to account for the economic-policy decisions of this party because it is the dominant partner in APNU. During the period 1970 to 1985, the PNC was largely antagonistic to private enterprise. This was the period of nationalisation of foreign entities, the promotion of cooperatives and general antagonism towards the local private sector. President Hoyte made a complete turnaround from 1985 until 1992, when the PPP returned to government with the appendage C to its name. The period 1985 to 1992 witnessed an open approach to the domestic private sector and an overly generous outreach to foreign businesses. With respect to the latter, two examples will suffice: Omai Gold Mines Limited would pay no corporation tax and Barama Company Limited was offered forest concessions of 1.6 million hectares or 6,177 square miles (Jamaica is 4,244 mi2, T&T is 1, 980 mi2 and Barbados is just over 166 mi2).
The Hoyte era policies were essentially derived from the standardised Washington Consensus measures of the time. These were basically free-market ideologies which promoted devaluation, privatisation, depletion of government capacity in undertaking industrial policies (no wonder we are all caught with pants down today vexing over local content), and trade and capital-account liberalisation. An astute observer at the time would have also seen several tendencies towards the kickback tax as much as the outward tendencies during the Jagdeo years. Hoyte was able to obtain the outward support of many, including notable East Indians, in the private business community. Many of these people would eventually switch sides to earn rents from the PPP/C after 1992.
The PNCR policy agenda from 2015 is completely different from that of the Hoyte years. On the surface, it appears very different from the 1970 to 1985 period of cooperative socialism and party paramountcy. However, a close examination of economic history – hence the importance of Greenidge’s well-researched book – would reveal that the policy set from 2015 is motivated by the same explanation. The outward appearance of dictatorship, media suppression and coercion are not yet there. These will most likely return if there is an election next year under the same problematic and loophole-ridden constitution.
Several researchers have described the period of party paramountcy and its economic consequences. But I am not so sure these have been fully explained. Describing and explaining are different endeavours. If we can explain the motivation behind party paramountcy, we can also explain the PNCR’s behaviour towards the private sector since 2015. If we are going to find a system to mitigate the harmful effects of the ethnic insecurities, we need to explain things, not just describe them.
In an academic paper published in 1975, the researcher Leo Despres cited an associate from the PNC who notes: “Burnham is ASCRIA as much as Eusi Kwayana is ASCRIA. ASCRIA is the cultural and economic arm of the government: the PNC is its political arm.” ASCRIA means African Society for Cultural Relations with Independent Africa. The core belief of ASCRIA at that time was that all Guyanese have been exploited by British colonialism and American imperialism. In addition, Afro-Guyanese have been further exploited and discriminated against by East Indians and Portuguese. Therefore, according to Despres, Africans have to be re-established on the land, regardless of whether the land is currently occupied by the sugar industry, interests in the interior or by East Indians. Members of ASCRIA were placed in most of the important positions controlled by the PNC in the 1970s and 1980s. Even though ASCRIA does not exist today, it would be naïve to believe it does not have lasting footprints in the PNCR.
It should be noted that immediately after the APNU+AFC came to power, Barama exited the forest concession. Bai Shan Lin had its 680,000 hectares revoked. However, we should also note that an East Indian-owned company was leased 400,000 ha after 2015 from the previous land under Barama’s control. A foreign Chinese company was leased another 400,000 ha formerly under Barama’s control. The government said it intends to lease the remaining 800,000 ha to smaller loggers.
In the background of Greenidge’s book is the idea that East Indians were given favourable treatment under land settlement schemes in the colonial period, while African Guyanese were not. And that this favourable treatment has lasting differential effect in economic outcomes today. In general, however, Greenidge’s work is nuanced, even if some of his conclusions might be wacky. For example, he notes on page 41 of the book that only about 20% of the Indians at the time exchanged their return fee for land. The implication is that landless Indians eventually squatted inside African villages and bought over land from Africans. No data was provided for the rates of squatting versus buying. My research so far shows no work was done to answer this question. Greenidge also observes (page 65), albeit in passing, that foreign demand for rice from the early 1900s resulted in an expansion of rice production, which benefitted Indians disproportionally. This is a crucial point, I believe, that should have received more attention. He gives a plausible explanation why African Guyanese did not pursue the higher yielding aquatic rice even though they planted the land variety long before Indians arrived in 1838. He also mentions in passing that the expansion of rice production benefitted mainly a few large-scale Indian farmers.
I argued in previous columns that there are two ethnic security dilemmas in Guyana. Both are underpinned by economic concerns. Both result today in pro-ethnic strategic voting by about 87% of the masses. However, the party elites of both PNCR and PPP/C are also motivated by these economic concerns. They also stoke the pro-ethnic strategic votes. In previous years some leaders, realising their numerical disadvantage, seized power. Therefore, I posit in this essay that Despres’ paper and Greenidge’s book hold important insights into the nature of President Granger’s economic agenda. It also explains what is likely to be the result if there is no constitutional overhaul.
A seat at the table in determining who gets what is the central motivating principle of APNU. Mr. Aubrey Norton also reinforced the latter point in a paper he published in 2007. It really does not matter what the ABC countries say. The PNCR is not interested in electoral politics for its own sake. The PNCR has its economic concerns and it does not want the PPP/C to tell it what it gets and how much. The PPP/C is not interested in electoral politics because Mr. Jagdeo and his immediate group are great liberal democrats. The PPP/C leadership believes they still have a numerical advantage and as a result they can win a free and fair election, thereby becoming top dogs in deciding who gets what and how much. We are, therefore, witnessing a conflict over the control of economic resources. This conflict started long before 1955.
I plan to explore further some issues which Greenidge mentioned in passing but are important in determining the relative success of the rice sector in Guyana. We also have to take up the false notion that East Indians control 95% of the economy (Greenidge did not write this; it came from a newspaper columnist), as well as the fact that most East Indians are underdeveloped just like most African Guyanese. These points will soon be in one place in an academic paper I am presently writing: “Two economic ethnic security dilemmas.”
Comments and/or questions can be sent to tkhemraj@ncf.edu
