When ExxonMobil begins oil production in Guyana next year, mining crude from its seven new deepwater wells, life may change dramatically in this small South American country.
The mega deal is expected to increase Guyana’s gross domestic product from US$3.4 billion in 2016 to $13 billion by 2025. That’s because Guyana, one of the poorest in South America, will receive about half of all ExxonMobil’s oil revenue after the company’s exploration costs are repaid.
Nearly 40 percent of Guyana’s 800,000 people live in poverty. The oil money will provide a remarkable economic boost that could strengthen education, health care and infrastructure.
But oil production brings risks, too. Guyana’s rice and sugar farmers worry that these traditional industries will suffer government disinvestment and neglect, and world history shows that great oil wealth often fuels political corruption.
Guyana has a cautionary tale of the dreaded “resource curse” right next door. Oil-rich Venezuela is in economic and political crisis, with inflation expected to reach 10 million percent in 2019.
For the rest of this article: https://theconversation.com/guyana-hopes-oil-will-bring-wealth-not-corruption-and-crisis-108958