Caribbean Business Reports

US Secretary of State warns of Chinese influence

An article from OilPrice.com has claimed that US Secretary of State Mike Pompeo’s visits to Guyana and Suriname last week were part of a promotions campaign for US energy companies.

“No State-owned operation can beat the quality of the products and services of American private companies,” the online publication quotes Pompeo, who made the pronouncement during a joint news conference with Suriname President Chan Santokhi.

“We’ve watched the Chinese Communist Party invest in countries, and it all seems great at the front end and then it all comes falling down when the political costs connected to that becomes clear. And we do our level best wherever I travel to make the case for just making sure everybody understands what they’re getting into.”

Last week Thursday, prior to Pompeo’s arrival in Georgetown, the US State Department did its best to assure the Guyanese public that the highest foreign affairs official’s visit had nothing to do with the Government of Guyana’s evaluation of ExxonMobil’s development plan for a State Department official told reporters that ExxonMobil’s evaluation will have to stand on its own merits.

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“I mean, this is certainly not an effort to put any pressure on Guyana. I think it’s more a celebration of their great success in this,” the official stated.

However, the US Secretary of State noted at a joint press conference with Guyana President Irfaan Ali, said, that the US energy company’s negotiations with the Guyanese Government are just that — “between Exxon and the Guyanese Government”.

Growth in the Americas

Pompeo’s visit to Georgetown, however, marked the signing of the Growth in the Americas Memorandum of Understanding between the US and Guyana, which “seeks to draw more US private sector investment to build Guyana’s physical infrastructure, energy sector, and digital economy, and to do so transparently”.

It is, therefore, clear that the US has an economic interest in Guyana, especially with the South American country’s foray into oil production.

And Pompeo’s concern about China’s influence in both Guyana and Suriname may have some merit.

While American companies ExxonMobil and Hess Corporation own 75 per cent (45/30) interest in the production at Guyana’s Liza project — expected to reach full capacity of 120,000 barrels of oil per day — China National Offshore Oil Corporation has a 25 per cent stake.

Quoting US Geological survey estimates, OilPrice.com said the Guyana-Suriname Basin holds up to 14 billion barrels of oil and 32 trillion cubic feet of natural gas. So far,Guyana has recorded 18 oil well discoveries and Suriname three.

What’s more, both oil-rich countries boast deposits of gold. In fact, in June this year, Chinese-owned  Zijin Mining Group Co Ltd acquired Guyana Goldfield’s operation for approximately CN$323 million.

China’s response

Responding to Pompeo’s remarks, China’s Ambassador to Guyana Cui Jianchun stated, “China develops relations with Caribbean countries including Guyana under the principles of mutual respect, equality, and mutually beneficial and win-win cooperation. China attaches no political strings in bilateral pragmatic cooperations, which bring tangible benefits to countries and peoples in the region. This is an objective fact that anyone without prejudice will admit.”