Dear Editor,
A serious attempt is being made by President Ali to move away from siloed development toward an integrated approach, in the spirit of both classical and modern development ideas. The President’s effort is embodied in the emerging framework of the Orange Economy (OE), which, to me, represents an exciting new way of framing interlocking development while accounting for various constraints—both natural and man-made (see SN letter column: Dr. Randy Persaud, Nov 26, 2025).
Guyana has a small, highly dispersed population. Many hinterland villages have small populations, who deserve equal material progress as citizens in the dense urban centers along the coastal plain. However, the average fixed cost of man-made capital—roads, bridges, power plants, and so forth—will be extremely high in the hinterland, making it difficult, if not impossible, to implement traditional development models. These costs are also very high in Region 6, where village populations are larger than those in the interior but still dispersed, with a small tax base. We often forget that the breaking point for Berbice’s integration into British Guiana in 1831 was the county’s inability to raise taxes to repay its public debt.
It follows that traditional development strategies focused on manufacturing cannot integrate all communities or achieve convergence in average income between hinterland and coastal rural areas and urban communities in Regions 3, 4, and 10. I am not saying it is impossible for Guyana to once again manufacture gas stoves, refrigerators, garments, and footwear, but this sector will always represent a small share of GDP. It will need to be highly automated, leaving only a limited role for labour.
Therefore, the anchoring of President Ali’s Orange Economy model is exciting because it emphasizes interlinking service-based industries—knowledge, cultural, artistic, and entertainment sectors. All my readings and studies of economic development suggest that the OE model can enable Guyana to leapfrog W.W. Rostow’s stages and propel high-paying service employment. Moreover, a service-based economy allows for technical upgrading and scaling in the product complexity space, despite what some traditionalists might believe.
Another promising prospect is the ease of integrating the OE model with Guyana’s abundant natural capital, which formed an essential pillar of former President Jagdeo’s Low Carbon Development Strategy (LCDS). Guyana now has an opportunity to merge OE and LCDS because the financial constraint is partially relaxed by offshore, enclave oil production, which provides an unprecedented stream of foreign exchange.
Serious constraints remain, however. Perhaps I will discuss them later. For now, the immediate challenge is for contractors building man-made capital to understand that if the government offers a contract for G$200 million, it does not mean the profit is G$200 million. It appears that Guyanese contractors prioritize maximizing individual consumption rather than taking pride in constructing durable and aesthetically pleasing structures. There is a serious misalignment between the government’s vigorous development efforts, led by a young President, and contractors’ desire to maximize personal consumption.
The President discovered this recently in Region 6, where contractors had completed only three of the 46 bridges. I am not even sure that most contractors understand why so many bridges are necessary when building critical roads. Achieving OE goals will be difficult as long as contractors continue to prioritize personal consumption while the government, with the best intentions, seeks to maximize development objectives.