Guyana, a small South American nation with a population of over 800,000 people, has found itself in the global spotlight due to a growing territorial dispute with its neighbor, Venezuela. The recent call by Venezuelan leader Nicolás Maduro for a referendum to annex Essequibo, which comprises two-thirds of Guyana’s land, has sparked international concern.
The territorial dispute, which was officially settled by an international tribunal in 1899, has been reignited by the discovery of oil in Guyana. Dr. Terrence Blackman, founder and CEO of the Guyana Business Journal, commented on the situation, stating, “What has happened is that it’s been exacerbated by the discovery of oil (in Guyana). This discovery has made it seem more attractive to Venezuela to pursue this course of action.”
Guyana’s oil boom, driven by a significant oil discovery in 2015, has propelled it to become the world’s fastest-growing economy. Despite Venezuela’s status as home to the world’s largest oil reserves, the country has faced a severe economic downturn under Maduro’s leadership since 2013.
Valerie Marcel, director at New Producers Group, highlighted the disparity between the two nations, stating, “Venezuela doesn’t truly have sources of support in its ambitions to take over that territory of Guyana, whereas Guyana, it seems, has international public law on its side, as well as the alliance with the United States.”
Despite Guyana’s economic growth, concerns have been raised about the potential pitfalls of the so-called “resource curse.” Critics point to the country’s weak democratic institutions and political divisions along ethnic lines as factors that could hinder its ability to effectively manage its newfound wealth.
Gregory Brew, an energy analyst at Eurasia Group, emphasized the significance of Guyana’s oil production, stating, “Guyana is at a crossroads in its history. It is about to become one of the most exciting and important oil-producing countries in the world.”
As Guyana navigates this critical juncture in its history, it faces both opportunities and challenges. The outcome of the territorial dispute with Venezuela will likely have far-reaching implications for the nation’s future economic and political trajectory.
(Source: Bloomberg | Reuters | CNBC)
