How do you tell a poor country like Guyana that it must do without oil dependence, without the opportunity for economic growth that oil represents, because of the emissions that it can generate?
Guyana's dilemma
Guyana's President Irfaan Ali made world news when he directly confronted BBC journalist Stephen Sackur during an interview criticizing the country's intense oil exploration and its contribution to climate change.
The interview went viral because it reveals the ideological tensions behind the historic North-South divide. Ali defended that Guyana has protected its forests like few other countries, providing an environmental service to humanity without receiving compensation. He also pointed out that the countries of the Global North, which devastated their own ecosystems on their way to development, act hypocritically in criticizing developing countries for following a similar path.
Economic growth based on oil dependence
Oil exploitation is bringing Guyana closer to the long-awaited development. In 2022 and 2023, Guyana had growth rates of 64.4% and 42.2%, respectively, driven almost exclusively by oil.
In this context, the question is: How can we ask a poor country to give up this opportunity because of the emissions it may generate?
Guyana argues that this oil bonanza will be used to diversify its economy, a narrative reminiscent of the dilemmas also faced by Colombia.
The global climate dilemma
While it is true that the world must drastically reduce its dependence on fossil fuels to comply with the Paris Agreement, it is also clear that countries like Guyana face existential dilemmas.
More than 60% of existing fossil reserves must remain in the ground if global temperature rise is to be limited. Guyana's decision to seek more oil may be based on two assumptions:
- That its oil will be among the first to be sold before the market collapses.
- That the world will not meet its climate commitments and will continue to consume oil.
Supply, demand and the energy future
A crucial point is the debate over whether it will be supply or demand reduction that will drive the energy transition.
Although it is argued that it will be demand that leads the change, having excess oil available may hinder decarbonization, due to strong lobbying by extractive industries at all levels of governance.
A prisoner's dilemma?
Guyana's situation resembles the classic prisoner's dilemma: individually, exploiting fossil resources is rational for each country, but collectively it leads to global climate disaster.
We need new narratives and multilateral agreements that redefine development in regenerative terms, moving away from the extractivist model that has dominated recent history.
Conclusion
The dilemma of oil dependence in Latin America is a reflection of the profound contradictions between economic development and planetary sustainability. Overcoming it requires redefining welfare, strengthening international cooperation and building new paths towards a truly regenerative future.
