FORMER Natural Resources Minister Robert Persaud has commended government’s ‘Green’ Paper for the establishment of the Sovereign Wealth Fund (SWF), but recommends that local content be a top priority.

The former People’s Progressive Party (PPP) minister in a Facebook post on Tuesday, weighed in on the recent green paper laid in the National Assembly last Wednesday by Finance Minister Winston Jordan.

Persaud spoke specifically to Jordan’s announcement that the government would be establishing a Natural Resource Fund (NRF) to ensure the revenue which comes from oil is properly monitored.

In his comments, he advised that the NRF be tailored to guarantee that Guyanese would reap the benefits of the sector through local content.
“Investment in people and national capacity to capture opportunities required for oil and gas upstream and downstream activities is urgent. The proposed Natural Resources Fund needs to have the flexibility to invest directly in initiatives to support local or national content capacity- building.

“The big oil companies, and their preferred list of suppliers, would want us to be in a state of permanent dependency and with limited capacity to offer services. They pay lip service to local content, but unless and until the government and primary actors be strategic and have a common vision, we will only be circling the wagon on the subject of local content,” he stated.

The government is still in the process of finalising its local content policy before the year’s end with its second draft produced some two months ago.

The policy outlines the framework by which local content will be understood, developed, measured and secured and has since received the support of local content specialist, Dr. Michael Warner.

Meanwhile, the NRF will serve as the most effective, efficient and transparent mechanism for achieving multiple objectives with its overall management to be taken up by the Finance Ministry.

However, there has been criticism that the Green Paper puts the Finance Ministry in charge of the NRF, with some suggesting that the SWF would be better managed independently.

RIGHT DECISION
However, Persaud said these expectations cannot follow through without constitutional reform and legislative frameworks to cater for such and, until then, the ministry must assume the role of management.

“The role of a specific ministry in managing these resources cannot be miniaturised as our existing constitution nor relevant financial laws does not allow otherwise. We cannot wish for a different arrangement, but still operate in an infected, ill-fated constitutional governance framework.

“Simply put, there cannot be accountability without responsibility. Or in layman’s term, I cannot be held accountable for something I have no responsibility for. If we want independence of oversight or management of the oil revenues, there is no shortcut: go change the outdated, ill-suited constitutional national governance framework,” he stated.
Other recommendations coming out of Persaud included allowing for public scrutiny and input of the draft NRF Bill and for the development of a national 2030 vision for the country’s development.

“The draft NRF Bill, when drafted, should be tabled and sent immediately to a Special Selective Committee of the National Assembly to allow for wider public input. This bill will give actual insights into the roles, functions and objectives of the NRF — the engine driving oil-wealth management for inter-generational wealth,” Persaud said.

He added: “A national vision for 2030 for the country’s development, shared by all, is critical for the success of the NRF and essential for the country’s long-term success in managing its hydrocarbons wealth and supporting a diversified national economy.”

He also suggested that Green Paper proposals be accompanied by legislations including the Petroleum Commission Bill.

The bill, which was before a National Assembly Select Committee, was delayed to facilitate input from the World Bank, but will soon be laid in the National Assembly, according to Natural Resource Minister Raphael Trotman.

Overall, Persaud believes that although “the Green Paper gives us hope,” there is need for policy action and a strong vision to meet the challenges and opportunities ahead.
He nonetheless commended the government’s Green Paper initiative, stating that such a move would ensure that the voices of all Guyanese at all levels are heard.

“The government must be commended for going the route of a Green Paper rather than a White Paper initially, as it allows for broad, uninhibited debate and discourse,” he said.
The former PPP minister then added: “Hopefully, the multiplicity of views will influence policy, legislation and executive action on the matters contained therein. We must not only be dependent on the multilateral agencies for advice, but listen to the voices, wisdom of the ordinary citizens who are the true owners of our resources.”