by Dyon A. Elliott
On Wednesday, May 16, the Commonwealth Secretary-General, Kamalesh Sharma, during his three-day visit to Belize, told The Reporter that one of the Commonwealth Secretariat’s goals is to help ensure that Belize’s petroleum fiscal regime achieve the fairest and most equitable returns for the Belizean people.
Sharma said, “We’re getting very strong on natural resources management with member states, and as far as the petroleum sector is concerned, we’ve already given an expert who prepared a report on the potential and how the management of the revenue can be done in the most responsible way.”
He also expressed his hope that Belize would be able to strike even more high-quality crude oil.
“There is a prospect that it may get more, in which case we are prepared to upgrade the work that we have done.”
In his statement “Why the Commonwealth matters to Belize”, Sharma said Belize could do well to use Commonwealth countries like Trinidad & Tobago, Ghana in West Africa, and Papua New Guinea as benchmarks, because these countries “have used their natural resources to create economic growth and resilience.”
While those countries may serve as paragons in natural resource usage, even as the drill-or-not-to-drill debate continues between the Belize government and environmentalists, an interesting parallel can be drawn between the concerns of Belizeans and those of one of the most impoverished Caribbean countries, The Republic of Haiti.
The country may actually have a way out of poverty, as gold and other precious metals (including silver) have been found in its hills.
Already reports say that a drilling company is hard at work trying to figure out how to extract the precious metals.
Valued at over $20 billion, officials have agreed that if the mining companies are fair and Haiti’s government is a good one, the country may have found its gold-silver-copper lining! But, the fact of the matter is that natural resource management doesn’t come naturally.
According to the Corruption Perception Index, which ranked 182 countries last year based on how corrupt their public sector is perceived to be, Haiti is ranked 175th.
In short, that’s bad. It definitely poses a serious question as it pertains to the type of regulation that would be enacted or enforced to ensure that this country’s revenues don’t fall through the cracks into private pockets.
According to reports, one company has full concession to take out metals.
Associated Press writer, Martha Mendoza, in her article “Haiti Gold Mining: Precious Metals May Be Way For Country To Move Forward”, said the company has “committed to spend $2.25 million in the first two years.
“In addition, it will pay $1.8 million after a feasibility study, according to the contract.”
Mendoza added, “Bottom line: Haitians should get $1 out of every $2 of profits, compared with about $1 out of $3 that most countries get from mining firms.”
She also quoted the author of the book The Oil Curse: How Petroleum Wealth Shapes the Development of Nations and UCLA political science professor, Michael Ross, saying:
“The great irony of mineral wealth is that those countries that most desperately need infusions of mineral revenue — low-income countries with weak governments — are also least likely to manage these resources wisely, for the benefit of the country.”
One thing that may protect Haiti from such inefficiencies is the fact that the eyes of the world have been fixated on the country since the 2010 earthquake floored its capital, Port-au-Prince.
Two years and over $2 billion in foreign aid later, the country is finally making baby steps towards recovery.
Unlike Haiti, Belize has not gained such world-stage status. Actually, it has done a good job of keeping its affairs at home, as Belize is not even ranked on the Corruption Perception Index. Even Somalia, defined as the most “corrupt country in the world”, can be found on last year’s list.
Why is Belize not ranked? The “official” answer is that there isn’t any available data for it to be included on the list.
As the Commonwealth Secretary-General, Kamalesh Sharma, explained, the Belizean government has the report from the Commonwealth’s experts on how our petroleum fiscal regime can be managed so as to provide fair and equitable returns for Belizeans.
However, if the world isn’t watching Belize like it’s watching Haiti, providing a mitigating effect against any type of corruption, on whose shoulders does this “watchdogging” fall?
The prospect of Belizean black gold is a promising thing. It can truly expand the country’s production possibility boundary and grow the Belizean economy; however, if it isn’t managed efficiently, and if the Belizean people don’t take their role in scrutinizing government policies seriously–especially before going to the polls — Belize would also fall victim to professor Michael Ross’s theory.
As the debate continues to focus on where drilling should be permitted, more Belizeans need to get on the horn about how the government of Belize plans to ensure that this sector, whether drilling is done on or offshore, truly provides this country with fair and equitable returns.