Part of the discourse on the subject of the implications of oil and the earnings to be derived therefrom for the future shape of the Guyana economy has had to do with the impact on the long-term future of those other sectors that have kept the country going until now and whether they will retain their sustainability once the various options associated with an ‘oil economy’ kick in fully.
The conventional wisdom is that the gold mining industry is likely to survive the fully-fledged advent of oil and gas in view of the fact that the sector has become entrenched as a highly profitable pursuit that can match any alternative investment that might derive from other areas of the country’s economy, oil included. The same, arguably, cannot be said for agriculture, which, its widespread entrenchment as a key sector in the Guyana economy notwithstanding, might well be challenged by sub-sectors of the oil and gas industry, those options, perhaps, proving to be equally proficient money-earners and far less demanding in terms of outlay and management.
A common feature of the behaviour of several economies that have been ‘blessed’ with the advent of oil, our CARICOM neighbour, Trinidad and Tobago being the example closest to home, has been the tendency to focus on developing new economic pursuits that arise out of the opportunities afforded by oil and opt for the utilization of their oil wealth to import food, sacrificing or at least significantly minimizing their agricultural sectors in the process.
A significant portion of the Caribbean’s US$4 billion food import bill is attributed to the extent of Trinidad and Tobago’s food imports together with the other amounts spent in various parts of the region catering to the tastes of the mostly North American and European tourist markets. Part of this trend has been accounted for by the fact that the advent of economic alternatives to oil in developing countries have tended (or so it sometimes appears) to accentuate the challenges associated with farming thereby creating a drift of both investment and labour away from the sector.
Public discourses on the economic openings associated with the Local Content opportunities in the oil and gas industry have afforded room to assess the extent to which Guyana’s agricultural sector might be ready to take advantage of the anticipated increase in demand for and other products. Here, the argument has been that the temptation that might be afforded by the substantive opportunities likely to derive from the oil and gas sector may change the shape of the country’s agricultural sector, if not suppress it altogether some current investors in agriculture yield to what might appear to be the more lucrative opportunities associated with servicing the oil and gas industry.
In the period since the advent of public discourse on the oil and gas sector and its likely implications for the wider Guyana economy there has been not nearly enough discourse of what happens to agriculture once the new resource becomes the bedrock of the Guyana economy. True, discourse on this issue has proceeded on the basis of a widely accepted desirability of ensuring that agriculture keeps in place on the country’s socio-economic landscape though that discourse has not been matched – at least up to this time – by any concrete plan for the significant strengthening of the sector to ensure its resilience to meet the oil and gas ‘challenge.’
One might argue that in the circumstances the moment might well be propitious to begin to contemplate the reintroduction of ideas which, up to four or five years ago, had been bandied about, albeit with little follow-up, that envisaged public and private sector investment in mega farms, taking advantage of the considerable experience which Guyana possesses in large scale cultivation to say nothing of those existing vast expanses of land in the coastal and more particularly the hinterland regions that can accommodate large scale farming.
The sooner the option of further significantly consolidating the agricultural sector goes past the stage of rhetoric and into the realm of examining the logistical, scientific, planning and invest-related implications, the better. This analysis will have to take account of various factors, not least, those that have to do with rising food prices, the likely inclination of an oil-induced population to see food importation as a convenient option, earlier than anticipated drifts away from farming into what might be perceived to be more lucrative pursuits in an oil economy and failure to recognize the additional contribution that agriculture can make to the country’s economy in circumstances where a global (perhaps we should begin with regional) demand for food will almost certainly have a positive impact on prices.
Focused national attention on the need to consolidate the country’s agricultural sector in terms of the development of policies that not only preserves the sector but expands it while ensuring its technological advancement, must of necessity precede the advent of first oil, given the likelihood that once the national notion of an oil economy (and all that it promises) kicks in, it might then be too late to refocus attention on the importance of agriculture, particularly as a means of food security. We can do worse than begin to assign a range of expert thinking to defining the role of agriculture in an emerging oil economy now.