Foreign Investments in OPEC Nations

After the lunch break OPEC reassembled to discuss a solution to reduce oil production for national expenditure. Prior to this, the delegate of Saudi Arabia was quiet when questioned by representatives of Reuters about the nation’s plan to make the country’s energy completely renewable. While questioning the delegate of Venezuela, the sanctions imposed by U.S President Donald Trump were discussed and the delegate stated, “Trump is a bully”. When asked to further elaborate they responded by saying, “He thinks he can just put sanctions on developing countries and oppress them.” The delegate of Libya proudly acknowledged the fact that their country is underdeveloped but has started using solar panels to encourage renewable energy. When asked what other plans they have for renewable energy in the future, they responded with, “No, as of now there are no other plans for renewable energy.”

The delegates of OPEC also introduced into the session a discussion on foreign investments during a moderated caucus. The delegate of Venezuela stated that foreign investments would help in technological advancements, liquidity rates and diversification of economies. The delegate of the United Arab Emirates (UAE) mentioned how the committee was divided on the issue into “those with flourishing economies and those with developing economies.” They also said that the impact of foreign investments depends on the country.

The delegate of Indonesia talked about how culture would be affected greatly and “would provoke westernization and make countries like the U.S and Saudi Arabia role models for our people.” A delegate of OPEC commented on how wealthier countries should be giving aid to countries in need. The delegate of Gabon took a firm stance on the investments and commented, “We support the investments, but with strict rules to apply it to only industrialization of the countries.”

Delegates of OPEC voiced their opinions on how foreign investments can also lead to entrepreneurship and stabilized economies. The delegate of Saudi Arabia said that the committee is moving towards being too dependent on foreign investments. The committee is trying to move away from oil dependency which does not mean that countries should solely depend on foreign investments. Iran said that the reduction of dependency would lead to “economic and social turmoil”. Iraq added that outsourcing would come before the investment to “teach our people and make them skilled labourers” and help build their own businesses. They also said that this would help reduce the dependency of oil in the Middle Eastern and North African region (MENA).

The Indonesian delegation said, “Because of the dependency of oil, many countries are unable to flourish and these countries have become primitive.” They also discussed instability of nations due to the volatility of the market. Foreign workers hold the same positions as local workers but get paid higher, thus resulting in an income inequality.

The delegates also discussed environmental effects and how the burning of fossil fuels increases the rate of climate change. Another point they mentioned was how all the OPEC nations are handicapped to the oil market and how they should diversify their economies and taking the example of the 2014 oil market dip.

Reporter: Vidhi Channa, Reuters

Editor: Akshita Mathur