February 25, 2018

A fair share…

…in oil profits

Ever since the oil bonus fiasco was uncovered, even partisans of the Government have been looking closer at the contract which was finally revealed. And what a can of worms has been revealed!
It all stems from Resource Minister Raphael Trotman’s “renegotiation” of the contract the PPP had signed back in 1999. Back then, Guyana had still been on its knees — brought there by the PNC in its 28 years of destructive rule. Guyanese were hoping and praying for a turnaround in their fate. When the US geological survey claimed their mapping techniques from space indicated the presence of oil off our shores, ‘bending’ over for Exxon made sense, since, in over a hundred years of exploration, all wells had come up as dry as the proverbial bone.
But by 2016, when Trotman renegotiated the contract, that contract had built-in terms stating the agreement was up for a rewriting. And that’s where Trotman blew it. We won’t go into all the “I’s” he didn’t dot and the “t’s” he didn’t cross, but the biggest blunder has to be agreeing to pay the oil company’s taxes for its share of income — which would amount to 30% of all those billions!!
One hears about tax holidays given to companies to attract them to one’s country; but those are for a limited duration, typically for ten years or so. But in this instance, Exxon can say with a straight face — to the US IRS, for instance — that its income was subject to foreign taxation; that the taxes were paid by the country’s government!! Have you ever heard such nonsense?
Anyhow, another issue has just been raised — about whether we’ll get a fair shake even before the profits are declared. Now, it is not unusual for the oil company to be allowed to deduct the costs of exploration against the revenues as expenses; this was standard in all mineral exploitation agreements. But back in the day, Burnham had already made quite a stink about how the foreign mining companies were able to use all kinds of sleight of hand to inflate those expenses in bauxite and, of course, lower the profits. In fact, it was one of the main reasons he offered for nationalising bauxite in 1970.
And as an acolyte of Burnham, did Trotman completely forget to get a handle on the strategies the mining and oil companies use and head them off at the pass? Well, we know he didn’t, and we have to find out why?
Your Eyewitness, going by the experience of so many countries described by President Trump as “shitholes,” concluded that someone was playing footsies under the table!
…for sugar workers
Now that sugar workers have been brought to their knees by the APNU/AFC regime, PM Nagamootoo has been given the role of apologist. In his latest column in the Chronic, he claims that the Government did so much for sugar after taking office. And are these things — you ask, dear reader — supposed to placate sugar workers??
Well, Nagamootoo says Government pumped billions into the industry; had a Commission of Inquiry; a State Paper presented to Parliament; and formed a Special Purpose vehicle to get rid of the three estates that have been closed. Are the 5,700 workers thrown into the streets supposed to excuse his betrayal now?
Let’s start with the money injected. Has Nagamootoo forgotten the decades he railed against the PNC for scooping off the profits from the sugar industry by a draconian levy? And that this levy kept the country afloat for decades, since it provided foreign currency when there was no other source? The PPP, to their credit, tried to rescue the industry in recompense.
But since when have sugar workers ever been given their fair share by the PNC, now including Nagamootoo?
…and fair shake
And the CoI into sugar? Nagamootoo should say why its recommendation to keep the estates going for another three years was ignored!