November 12, 2012

Allow the citizens, not the State, to do the sowing of the natural resource revenues

Sir, Sylvia Pfeifer, tackles the issue of how “Africa’s new oil nations grapple with the ‘curse’ of wealth” November 12 and, in it, refers to South Sudan where oil represents 98 per cent of state revenues. In my country, Venezuela, because of high oil prices and a prolonged period of economic de-diversification, oil revenues currently represent over 97 percent of all exports, and these are also managed by a “small staff”, in Venezuela´s case by only one.

Having been named the first diversification manager in the Venezuela Investment Fund set up in 1974 to manage the explosion in oil revenues, and resigning from my post after less than two weeks because of political pressures to have a mega project approved, I know a bit on the subject of oil and its governance. The first think I would recommend Sylvia Pfeifer and her readers, is to sit down and reflect for a while, on what such a concentration of power would mean in their own country. Would they be able to have some type of meaningful democracy? No way José! 

Our much loved and famed Venezuelan intellectual Arturo Uslar Pietri wrote about the need for “Sowing the Oil”. Unfortunately, Pietri left out the vital issue about who was going to do the sowing. At this moment, having accumulated all type of experiences I am absolutely sure that had oil revenues been distributed directly to the citizens in Venezuela, so that they had had the chance to learn how to sow it, we would live in a much better country. As is, all our citizens´ prime concern, from cradle to grave, is to how position themselves in order to get the most of those resources, which are really theirs, back from the sort of elected Great Distributor. 

When a nation begins receiving significant natural resource revenues, there is one very important question it needs to answer, namely: What is more important, that its government learns to manage those revenues or that its citizens do? I myself have no doubt, good citizens are much more important than good governments.