The Technical Committee’s work is of vital importance to the Economic Committee

January 23, 2014, By chris, Filed Under Features/Columnists, Peeping Tom, Source

Linden is an industrial town. It was created around the bauxite industry and its future has historically been tied to that industry.

One of the mistakes made after nationalization was the absence of attracting foreign direct investment to the industry. This was seen as incompatible with the desire to bring the commanding heights of the economy under State control.

The bauxite industry has historically required significant capital investment. The need to attract foreign direct investment became more demanding because of the gross inadequacy of financing from the State, a situation aggravated because of the terms of nationalization, which required compensation to be paid to the bauxite companies.

Burnham was not keen on foreign direct investment. He however recognized the need for cheap energy so that a smelter could have been built.
As such, he conceived of a plan to build a hydroelectric station to generate energy to power a smelter.

The future prospects of bauxite were therefore hinged on cheap energy, which it was hoped that the Upper Mazaruni Hydroelectric Project would provide.

That project in itself was fatally flawed. While the excuse made was that the World Bank and the Venezuelans vetoed the project, the reality was different. The project was heavily premised on the sale of excess energy to Venezuela and when this did not materialize, the project was doomed, and with it the future of Linden.

In later years, Burnham’s successor, Desmond Hoyte did attract foreign direct investment to Linden. But all this resulted in was the massive depletion of bauxite reserves, with very little invested by the companies in the town itself.

Millions of tonnes of ore were extracted by foreign multinationals. Linden had little to show for this investment but massive debt.

This debt eventually forced the then government to convert this debt into bonds, because of the inability to repay the debt.

Under the PPPC also, the bauxite industry was bailed-out to the tune of billions of dollars each year. Foreign direct investors were later invited to take over the mines.

Things did change though. Under the PPPC, the economy of Linden was diversified. Linden has become more diversified than any other region in Guyana.

But it still remains primarily an industrial town. Linden remains a bauxite town, but there are other economic activities that are taking place there, and this is as a direct result of the policies pursued by the Jagdeo administration.

The PPPC in the run-up to the 2011 elections promised to create 1,000 new jobs in Linden. Last year, a major company advertized for seven hundred and fifty jobs, the majority of which were to be in Linden. The media has not followed up as to how many persons from Linden took up that offer, or indeed as to how many new call centre jobs have been created in Linden since 2011.

Industrial towns require cheap energy. Without cheap energy, investors will not come and existing industries will remain uncompetitive.

After the tragic events in Linden in July 2012, a number of committees were established including a Technical Committee to examine the electricity issue and an Economic Committee to look at the development of Linden.

Given that Linden remains primarily an industrial town, the work of the two committees are interrelated. It makes no sense for the Economic Committee to do any work unless it has a clear understanding of the electricity issue and the costs at which energy can be made available in the future.

No Economic Committee can plan properly without this information. It therefore makes little sense for the work of the Economic Committee to go ahead without benefiting from the findings of the Technical Committee.

Amaila has been effectively euthanized by the opposition parties. Even if it is revived, it will take five years at the minimum to get going. Linden cannot wait that long. It is therefore important that the problems affecting the constitution of the Technical Committee get going.

The parrying over who should head the Technical Committee, indeed any committee at all, is totally unwarranted. Professionals, regardless of their political persuasions, generally work well together. In fact, politicians from across the political divide have shown that they can also work well together in committees. It is outside of the committees that problems arise.

Guyana needs more opportunities for our professionals and our politicians to work together. Doing so will break down the high degree of mistrust that exists.

For this reason, the sides that negotiated the agreement over Linden should not get bogged down as to whom to appoint to head the Technical Committee. Just appoint someone who is technically competent. Whether that person is PPP or APNU really does not matter. At the Committee level, that person will work well with the other members and there will be progress.