Climate Hypocrisy on Full Display
A must listen interview with the President of Guyana, Mohamed Irfaan Ali, about climate change and development.
Guyana is one of the poorest countries in the world and is emerging as a potential front in the US-China War, as I wrote last year. The main reason for my concern about this potential conflict was a referendum held by the Government of Venezuela that called for declaring sovereignty over more than two-thirds of Guyana’s land in a region known as the Essequibo.
At the time of the referendum, I noted that South America’s only English-speaking country was on the verge of a complete economic transformation due to the discovery of an enormous offshore oil field by a consortium led by ExxonMobil in 2015:
Before production began in 2019, more than 40% of Guyana lived on less than $5.50 per day. Once the oil started flowing, so too did money, transforming Guyana into the world’s fastest growing economy: “With $1.6 billion in oil revenue so far, the government has launched infrastructure projects including the construction of 12 hospitals, seven hotels, scores of schools, two main highways, its first deep-water port and a $1.9 billion gas-to-energy project that… will double Guyana’s energy output and slash high power bills by half.”
The oil field was a gigantic discovery, perhaps the largest ever in the Western Hemisphere. ExxonMobil now believes it may be its most productive region within its portfolio of global assets and analysts believe Guyana will become the fourth largest producer of offshore oil in the world. The Stabroek Block, about the size of Massachusetts, is reported to have more oil reserves than Kuwait or the United Arab Emirates.
The oil discovery has already begun to improve the lives of hundreds of thousands of Guyanese citizens and transformed the nation from an undeveloped struggling society into the world’s fast growing economies.
Last week, Guyana’s President, Mohamed Irfan Ali, sat down with the BBC’s Stephen Sackur for an in-depth interview about the opportunities and challenges that accompany the massive wealth gains coming from oil. Despite what many have called an unfair contract that gives disproportionate and inappropriately large returns to Exxon, the President admirably responded to an interrogation that tried to publicly pit him against Exxon with a call for the protection of contracts and respect for rule of law. He went on to note that Exxon invested substantial risk capital to explore in an area where there was no known oil.
But perhaps the most interesting part of the interview, which I encourage you to watch, is the portion when President calls out the reporter for lecturing him and his country about climate change. Sackur highlights the enormous carbon that will be taken from the seabed oil reserves and released into the atmosphere before the President interjects that Guyana has a forest that is the size of Scotland and England combined. The BBC host then asks if it gives Guyana the right to “release all of this carbon.”
The President’s response puts climate hypocrisy on full display: “Does that give you the right to lecture us on climate change? I’m going to lecture you on climate change, because we have kept this forest alive that stores 19.5 gigatons of carbon that you enjoy, that the world enjoys, that you don’t pay us for, that you don’t value, that you don't see a value in, that the people of Guyana has kept alive. Guess what? We have the lowest deforestation rate in the world. And guess what? Even with the greatest exploration of the oil and gas resources we have not, we will still be net zero. Guyana will still be net zero with all our exploration.”
The BBC host again interrupts, but the President continues: “I’m just not finished… this is a hypocrisy that exists in the world. The world in the past 50 years has lost 65% of all its biodiversity…we have kept our biodiversity. Are you valuing it? Are you ready to pay for it?" before concluding with “There is no hypocrisy in our position.”
The BBC host then turns to a Greenpeace statement about the need to keep all remaining fossil fuels in the ground, further noting that most of Guyana’s population is below sea level. The President’s response captures the clarity of his message: “Greenpeace and you can say that…but who is going to pay for the infrastructure? Who’s going to pay for the drainage and irrigation? Who is going to pay for the development and advancement of our country? Are you going to pay? It’s not coming from anywhere. it’s not coming from Greenpeace or anyone else. Look at the adaptation budget that is required for the developing world. Where is the money coming from?”
Sackur then disdainfully notes that Guyana seems to be on path to aggressively develop the oil resources…to which the president responds: “We are practical…we are going to aggressively pursue this natural resource…because we have to develop our country. We are committed to the development of this region. We have to create opportunity for our people because no one is bringing that for us, no one is paying for our agenda. “
The BBC host then ends the interview with a simple question: “Oil can still end up being more of a curse than a blessing to the Guyanese people. Are you sure that won’t happen?” The President’s response is as succinct as it is eloquent: “We intend for it not only to be a blessing, but for it to be an important tool in the transformation of our society and the building of a prosperous Guyana and a sustainable Guyana; for us this revenue this stream of revenue offers us the opportunity to diversify our economy and to create a country that can finally fulfill all of its potential.”
VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worth profiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.
Bravo Vikram - very well said as always