Curbing environmental destruction is the least that can be done
Gold mining is hazardous to the environment. Gold mining is, however, not going to be outlawed because of its environmental effects. The reason is economic. The economy only grew in 2016 because of gold output. And so without gold there will be recession, all things remaining the same as they were at the end of 2016.
The government seems very comfortable with riding on the gold wave.
The 2017 Budget had few policies aimed at stimulating the other main sectors of the economy. The two Budgets of APNU+AFC were more about taxes than about growth, a major shortcoming which the government has tried to dismiss as a case of the economy ‘righting’ itself.
An economy does not right itself. Free markets do. The economy is more than free markets. It is, also, about the growth of the various sectors.
And quite honestly, the APNU+AFC coalition has demonstrated a glaring lack of vision when it comes to growing an economy.
Despite the adverse environmental effects of gold mining, the sector is not likely to be scaled out. When the PPPC signed an agreement with Norway for a financial stream of benefits related to the environment, the PPPC also said that mining and forestry would not be outlawed. The PPPC spoke about sustainable management of its forestry resources and improved mining practices.
The PPPC successfully managed to contain deforestation within the limits agreed upon with Norway. There is no successor to the Norway agreement but the government, and so the question is likely to be raised as to what happens when the Norway agreement expires.
Guyana, under the APNU+AFC administration, seems to have its own ideas on the environment. Gold mining is going to be at odds with the government’s stress on the green economy. The question, therefore, is how government is going to limit the environmental destruction that is being caused by gold mining.
The government’s talk about a green economy is not going to be taken seriously if it continues to expand gold mining. On the other hand, the economy is presently only showing growth because of gold.
The absence of any clear-cut policies to grow the other sectors of the economy means that the government is gambling on oil. It is waiting for oil to be pumped and for the avalanche of funds which will be deposited as a result.
Eric Williams, the late Prime Minister of Trinidad and Tobago, used to boast that oil don’t spoil. Burnham used to tell him that while oil does not spoil, you cannot eat oil.
Guyana must not become dependent on oil. It must find a way in which it can exploit its oil, its forests and its gold in a manner that is sustainable, without any massive effects on the environment.
Offshore drilling of oil always carries with it the risk of environmental accidents. Safety standards and oil spill responses have improved over the years, but these have not made accidents impossible, nor will they ever.
The government therefore should not put all its eggs in the oil drum, as now seems to be the clear strategy. This will have dire long-term consequences, as we have seen with countries such as Venezuela and Nigeria, which have suffered greatly since the decline in oil prices. Guyana seems, however, to be counting its chickens before they are hatched.
A lid will at some time or the other have to be placed on gold mining, so that it can remain sustainable and environmentally manageable. But what should be the production level which should be treated as the benchmark above which production should be curtailed?
Some persons will suggest that gold production of one million ounces should be what we should be aiming for in Guyana. This is a reasonable limit. Anything above this should be deemed unsustainable. If we are not going to have pro-growth policies, then the least which can be done is to curb environmental destruction by limiting gold mining expansion.