Does money grow on trees?

Anthony Wilson
Published: 30 Jul 2009

The headline of last week’s column in this space, “Are environmentalists anti-people?” raised some eyebrows and even led one columnist in the Guardian to describe it as “bizarrely stupid”—although she declined to state why she felt so. The column itself may have led some to the mistaken belief that I specifically support the establishment of the Alutrint smelter. I do not. Those promoting Alutrint are simply going to have to provide the nation with much more information on whether the benefits of a 125,000 tonne, stand-alone smelter with local value added in the form of downstream industries will ever be enough to balance the cost associated with building the smelter, the power plant and the port as well as the cost of relocating residents from La Brea.

logoOne would need to reserve judgment until the Government is able to make a persuasive business case for Alutrint—a case that looks at the cost of capital to build the smelter, the plant and the port as well as the roads and other infrastructure and the revenues that the smelter and its associated industries would need to generate in order to make the entire undertaking feasible. The Alutrint smelter is expected to cost up to US$600 million. This company, as it stands, is currently 100 per cent state-owned. One assumes that there would be an additional cost for the downstream projects which include an automotive parts and car wheel plant. The 760 megawatt power plant, some 60 per cent of which will be used to generate electricity for the smelter, is estimated to cost US$786 million. That’s close to US$1.4 billion and does not include the cost of building the port. Will the smelter and its associated downstream projects generate enough permanent jobs and revenue to be able to justify the expenditure by the State in developing Union Estate in La Brea? Like all other projects in which the State (that is taxpayers) is heavily exposed, the Government should be required to provide a full explanation to the population of whether this is the best use of our money and our depleting natural gas resource. Will taxpayers be required to subsidise the expenditure on the industrial estate? The point is I do not know because the Government has not bothered to put down its case in black and white or present a policy statement on the issue of industrialisation in Parliament. It is like Philip Saunders, the departing chief executive of Caribbean Airlines, calling me on Tuesday night to say that the airline made a profit in 2008 because he was looking at the audited results right then, but declining to share the results because they first have to go to the board, then to the Cabinet sub-committee, then to Cabinet and then to Parliament. Who was it that said: Trust but verify? While I do not know enough about the feasibility of the aluminium project to support it, I am fully behind the Government’s plans to expand the country’s industrial footprint beyond Point Lisas and Point Fortin to Union Estate in La Brea and what is being called the Point Lisas South and East Industrial Estate in Claxton Bay. And I fully support the Government’s unstated policy of maximising the use of T&T’s natural gas resources because it is quite likely that natural gas as a fuel will be obsolete in 20 years. The point needs to be made, though, that if T&T only has enough natural gas to last for 20 years of expanded industrial development, Government’s policy of long-term savings will need to be radically different in the future than it was in the past. The point needs to be made, as well, that the people of T&T have benefited and will continue to benefit from the exploitation of the country’s natural gas resources. And this is not theory. Earlier this week, I asked three of my journalist colleagues—let’s call them E, G and K—who live in state houses whether they would have been able to afford to buy their homes were it not for the extensive state subsidy on house prices. Each of them admitted that it would have been difficult, if not impossible, given what they earn as journalists. All three rented houses or apartments before they moved into their State-subsidised homes. And all three said that they saved about $1,000 as a result of moving into their state-subsidised homes as opposed to paying rent. Although I did not ask them, there is little doubt that the $1,000 savings and the security of owning their own homes and not being at the mercy of their landlord increasing the rent every year would have improved their standard of living and their future prospects. Do people in Barbados, Jamaica or Antigua have the benefit of an extensive state-sponsored house construction programme? Where do those who disapprove of T&T’s natural gas industrialisation think the money comes from to build those subsidised homes? I wonder if the disapprovers think the money to build communities of homes across the country comes from the trees next to the Marianne River in Blanchisseuse? Each of the three journalists I spoke with have school-aged children. They will soon have to think about sending them to university. Four years ago, the Government announced that it was eliminating the tuition fees that citizens had previously paid to attend tertiary institutions. Where does the money come from to allow the Government to double the number of places it offers to citizens at UWI’s St Augustine campus? Where does the money come from to construct UTT which has allowed thousands of poor people’s children to get a university education that would otherwise have been closed off to them because of the cost of it? The indisputable fact is that the money to build subsidised homes, provide 2 per cent mortgage rates, fund “free” tertiary education, construct UTT and ensure the supply of drugs under CDAP has come from the liquefaction and export of T&T’s natural gas. Those who think that building an economy on buffalypso and coconuts would have allowed the expansion at UWI, the establishment of UTT and the construction of thousands of those subsidised houses live in an alternate reality. It may be argued, therefore, that those who are against T&T’s industrialisation by natural gas are saying to E, G and K that they don’t deserve to live in their own homes and they don’t deserve to be able to send their sons and daughters to university when the time comes. It is saying to the mothers of E, G and K that they don't deserve to receive a pension that would allow them to spend their retirements in relative comfort. I am reopening the industrialisation debate with a promise to publish ALL responses which meet the normal criteria in the BG. http://guardian.co.tt/business/business-guardian/2009/07/30/does-money-grow-trees