Exit the Dragon

THE EDITOR: Between December 2023 and April, the much touted and anticipated Dragon gas deal has moved from “the great hope” and the panacea for our economic woes to disappointment and defeat.

This change in fortune was precipitated by one stroke of the pen by US president Donald Trump, as he signed an executive order to reimpose full economic sanctions on Venezuela, and by extension any economic arrangements that may have existed with other nations.

The response to this unfortunate development by most commentators has ranged from despair to pessimism. To quote former prime minister Dr Keith Rowley, “If you see us losing that OFAC licence, as you will see in the news if that happens, then you know that your coo coo is cooked. If you see the Venezuelans not allowing us to use the Dragon field, then you know that we are in difficulty.”

It is no doubt that the Dragon gas deal was a great opportunity for TT to acquire a new source of natural gas to bolster our local depleting supply and therefore earn much needed revenue and foreign exchange. After all, the estimated capacity of the field is 4.2 trillion cubic feet of gas and this was to be transported to our territory by just 17 kilometres of pipeline.

However, the National Joint Action Committee (NJAC) believes that this disappointment or setback needs to be seen as a blessing in disguise. Since the experience of the oil boom in 1973 followed by a natural gas boom during the 1990s, the approach by our leaders, and by extension our nation, to the resulting windfall of revenue has been a most irresponsible and reckless one.

In the words of former prime minister Dr Eric Williams, “Money is no problem.” As a result, our country experienced an economic phenomenon that is referred to as Dutch Disease.

The country acquired a preference for excessive spending on foreign goods, which was fuelled by a prevailing ethic of wild consumerism and materialism. There was an accompanying failure to diversify our economy by investing in our local and indigenous industries, as well as our manufacturing and agricultural sector, which could have developed as alternative sources of revenue for the country.

Today our nation is suffering the severe consequences of such irresponsibility and short-sightedness. Despite the continuing rhetoric of diversification by the government over the years, today we are shamefully and needlessly importing approximately $8 billion in food annually.

NJAC is of the view that if the outcome with the Dragon gas deal was more fortunate, the approach by the government to the resulting windfall of revenue would have been no different to what has existed in the past, same old, same old.

The situation as it is, therefore, forces the government, and by extension the nation, to now give greater focus to the process of diversification, because we have no other choice or alternative to gain much needed revenue. Hence a more positive view of the situation concerning the Dragon gas deal could reveal what may actually be a blessing in disguise.

The new government must therefore have the political will to engage the population in a process of re-education and reorientation in order to enable a gradual shift from our acquired preference for foreign tastes towards an increasing consumption of local goods. In this way we can reduce the demand for foreign exchange.

This must be accompanied by greater attention to and investment in other undervalued and underexplored sectors, such as the maritime sector, agriculture, the creative industry, and niche tourism, among others.

One thing is certain: we cannot afford to make another error as this government has done, that is, to gamble our prospects on any hopeful arrangement that is outside of our control or to hope for a miracle within the energy sector.

BRO KWASI MUTEMA

servant leader

NJAC