scholarly journals Economic Diversification Potential in the Rentier States Towards for a Sustainable Development: A Theoretical Model

2019 ◽  
Vol 11 (3) ◽  
pp. 911 ◽  
Author(s):  
Abdullah Kaya ◽  
Evren Tok ◽  
Muammer Koc ◽  
Toufic Mezher ◽  
I-Tsung Tsai
Keyword(s):  
Theoretical Model ◽  
Global Economy ◽  
Oil And Gas ◽  
Economic Value ◽  
Optimal Level ◽  
Domestic Economy ◽  
Rentier State ◽  
Economic Diversification ◽  
The Status ◽  
Rentier States

This paper develops a theoretical model to analyze whether a rentier state can diversify its economy away from the rent revenue and hence sustain the economic development and preserve the status-quo. Considering the decarbonization process of the global economy and rapidly fall in economic value of hydrocarbons in the face of the supply glut, rentier states depending on oil and gas revenues urgently need to diversify their economies to avoid social backlash and political upheaval. There are three intertwining factors that determine an effective economic diversification away from the rent revenue: The profitability of non-rentier sectors, the size of the domestic economy to induce a “Big Push” for industrialization to non-rentier sectors, and the level of economic inclusivity. For an optimal level of economic diversification in a rentier state: (1) Non-rentier sectors should be attractive to private agents without the entry barriers; (2) domestic economy should be large enough to induce investment into non-rentier sectors; (3) the ruler(s) should have sufficient tolerance (inclusivity) for private agents investing into non-rentier sectors. Our findings indicate that a rentier state can achieve an optimal level of economic diversification provided that the conditions above are met even without any political change.

scholarly journals City Branding, Sustainable Urban Development and the Rentier State. How Do Qatar, Abu Dhabi and Dubai Present Themselves in the Age of Post Oil and Global Warming?

Energies ◽  
2019 ◽  
Vol 12 (9) ◽  
pp. 1657 ◽  
Author(s):  
Martin De Jong ◽  
Thomas Hoppe ◽  
Negar Noori
Keyword(s):  
Oil And Gas ◽  
Urban Expansion ◽  
Abu Dhabi ◽  
Sustainable Urban Development ◽  
City Branding ◽  
Rentier State ◽  
Urban Neighbourhoods ◽  
The One ◽  
Rentier States ◽  
Economic Zones

In the past three decades Qatar, Abu Dhabi and Dubai have realised a meteoric economic rise. Whereas the former two can be considered ‘rentier states’ heavily depending on oil (and gas) revenues, the latter only leans on oil for a mere 6% of its gross domestic product (GDP). Although the economic rise has brought considerable welfare, it has also led these emirates to attain the world’s highest per capita carbon footprint. To address this problem Qatar, Abu Dhabi and Dubai seem to have formulated policies with regard to sustainable urbanisation and adopted strong branding strategies to promote them internally and externally. In this paper we examine which steps have been taken to substantiate their claims to sustainable urbanisation, in branding as well as in actions taken towards implementation. We find that all three have been very active in branding their sustainable urbanisation policies, through visions and policy frameworks as well as prestigious development projects, but that the former is substantially more impressive than the latter. Results also show there is a difference between Abu Dhabi and Qatar on the one hand, and Dubai on the other. Dubai has large number of small ‘free economic zones’, academic institutions for developing a knowledge economy, and smart and/or sustainable urban neighbourhoods, while Qatar and Abu Dhabi have a small number of very large ones. From the three, it is currently Dubai which has taken the lead in this development, largely completing its industrial transition with vast economic diversification and urban expansion. However, across the board this has had little effect on its ecological footprint.

scholarly journals Rentier state as an obstacle to development in the Middle East

2013 ◽  
Vol 21 ◽  
pp. 20-29
Author(s):  
Andrzej Guzowski
Keyword(s):  
Middle East ◽  
Oil And Gas ◽  
Arabian Peninsula ◽  
Middle Eastern ◽  
Economic Structure ◽  
International Market ◽  
Rentier State ◽  
Rentier States ◽  
External Actors

Many Middle Eastern countries, especially the ones in Arabian Peninsula, are well-known for being rich with oil and gas. While it could be considered a blessing by many, it is becoming more and more apparent that the abundance of natural resources in the region is a double-edged sword and a form of a natural resource trap. Many countries have become so-called “rentier states”, funding their operations and their very structures by renting their resources to external actors. While it may seem like a profitable political move at first, said overreliance conserved the structure of economies in the Middle Eastern, never forcing the countries to develop effectively, thus making most of the produced goods, other than oil and gas, uncompetitive on the international market. Long term, it may prove disastrous for the Middle East as eventually the resources are going to get exhausted and said countries will be left with nothing but an economic structure unadjusted to the 21stcentury.

Sustainability of Public Finance of Rentier States

2020 ◽  
pp. 88-113
Author(s):  
Lukman Raimi ◽  
Abdussalam Aljadani
Keyword(s):  
Public Finance ◽  
Saudi Arabia ◽  
Value Added ◽  
Rentier State ◽  
Economic Diversification ◽  
Industrial Services ◽  
The Public ◽  
Sustainability Strategies ◽  
Political Commitments ◽  
Rentier States

Embedding this discourse on rentier state theory (RST), this chapter discusses the quest for sustainability of the public finance system of Nigeria and Saudi Arabia. The inability of these rentier states to meet their economic, social, and political commitments led to the adoption of value-added tax (VAT) and economic diversification as sustainability strategies. The findings from the macroeconomic data indicated that Nigeria and Saudi Arabia have large markets that provide opportunities for the introduction of VAT. These two countries also have huge deposits of natural resources, including oil, which could be developed for accelerating economic diversification. This chapter validates the appropriateness of VAT and post-rentier economic diversification as sound policies for industrial, services, tax, and tourism development. The findings from this chapter need to be strengthened with a more rigorous empirical investigation. The chapter concludes with far-reaching policy suggestions.

Post-rentier Economic Challenges

2017 ◽  
Vol 73 (2) ◽  
pp. 210-226 ◽  
Author(s):  
Kristian Coates Ulrichsen
Keyword(s):  
Political Economy ◽  
Oil And Gas ◽  
Volatile Oil ◽  
State Theory ◽  
The Political ◽  
Rentier State ◽  
Economic Stability ◽  
Political Aspect ◽  
Gulf State ◽  
Rentier States

The rentier states of the Middle East face a combination of political and economic challenges as they seek to reduce their reliance on volatile oil and gas revenues and diversify their economies. This article examines how the political economy of the six Gulf Cooperation Council (GCC) states remains heavily dependent on the hydrocarbon sector and analyses the policy responses to the fall in world oil prices since 2014. Sections in the article examine the definitional aspect of rentier state theory, nature of the redistributive welfare state that developed in the 1970s in each Gulf State, and the political aspect of economic measures that seek to reform aspects of the distinctive political economy that has underpinned socio-political and economic stability for the past five decades.

Varied Responses to Human-Induced Seismicity in the City of Azle, Texas

2019 ◽  
Vol 3 (1) ◽  
pp. 1-8
Author(s):  
Sarmistha R. Majumdar
Keyword(s):  
State Government ◽  
Induced Seismicity ◽  
Oil And Gas ◽  
The United States ◽  
The State ◽  
Prior History ◽  
Small Community ◽  
Regulatory Policies ◽  
The Status

Fracking has helped to usher in an era of energy abundance in the United States. This advanced drilling procedure has helped the nation to attain the status of the largest producer of crude oil and natural gas in the world, but some of its negative externalities, such as human-induced seismicity, can no longer be ignored. The occurrence of earthquakes in communities located at proximity to disposal wells with no prior history of seismicity has shocked residents and have caused damages to properties. It has evoked individuals’ resentment against the practice of injection of fracking’s wastewater under pressure into underground disposal wells. Though the oil and gas companies have denied the existence of a link between such a practice and earthquakes and the local and state governments have delayed their responses to the unforeseen seismic events, the issue has gained in prominence among researchers, affected community residents, and the media. This case study has offered a glimpse into the varied responses of stakeholders to human-induced seismicity in a small city in the state of Texas. It is evident from this case study that although individuals’ complaints and protests from a small community may not be successful in bringing about statewide changes in regulatory policies on disposal of fracking’s wastewater, they can add to the public pressure on the state government to do something to address the problem in a state that supports fracking.

The Central Asian Economies in the Twenty-First Century

2019 ◽  
Author(s):  
Richard Pomfret
Keyword(s):  
Migrant Workers ◽  
Global Economy ◽  
Oil And Gas ◽  
The United States ◽  
Kyrgyz Republic ◽  
The European Union ◽  
Central Asian ◽  
Asian Economies ◽  
Belt And Road ◽  
External Powers

This book analyzes the Central Asian economies of Kazakhstan, the Kyrgyz Republic, Tajikistan, Turkmenistan, and Uzbekistan, from their buffeting by the commodity boom of the early 2000s to its collapse in 2014. The book examines the countries' relations with external powers and the possibilities for development offered by infrastructure projects as well as rail links between China and Europe. The transition of these nations from centrally planned to market-based economic systems was essentially complete by the early 2000s, when the region experienced a massive increase in world prices for energy and mineral exports. This raised incomes in the main oil and gas exporters, Kazakhstan and Turkmenistan; brought more benefits to the most populous country, Uzbekistan; and left the poorest countries, the Kyrgyz Republic and Tajikistan, dependent on remittances from migrant workers in oil-rich Russia and Kazakhstan. The book considers the enhanced role of the Central Asian nations in the global economy and their varied ties to China, the European Union, Russia, and the United States. With improved infrastructure and connectivity between China and Europe (reflected in regular rail freight services since 2011 and China's announcement of its Belt and Road Initiative in 2013), relaxation of UN sanctions against Iran in 2016, and the change in Uzbekistan's presidency in late 2016, a window of opportunity appears to have opened for Central Asian countries to achieve more sustainable economic futures.

Has the Sovereign Wealth Fund of Azerbaijan (SOFAZ) Been Able to Promote Economic Diversification?

2013 ◽  
Author(s):  
Vahid Yücesoy
Keyword(s):  
Fossil Fuels ◽  
Dutch Disease ◽  
Future Generations ◽  
Direct Control ◽  
Economic Diversification ◽  
Sovereign Wealth Funds ◽  
Sovereign Wealth Fund ◽  
Rentier States ◽  
Oil Revenues ◽  
Rich Countries

Oil-rich countries have oftentimes been confronted with the challenge of diversifying their economies away from oil dependence given the exhaustible nature of these fossil fuels. Investing in sovereign wealth funds has been one of the most ubiquitous ways of preparing for the post-oil period. Investing in sovereign wealth funds rather than directly injecting the oil revenues in the economy not only precludes the outbreak of the Dutch Disease (which is known for giving rise to an exchange rate appreciation, crowding out non-oil industries and keeping the economy reliant on oil), but it also saves for future generations. Yet, in the case of Azerbaijan, the Sovereign Wealth Fund of Azerbaijan (SOFAZ), founded in 1999, has only increased this reliance on oil. Using the rentier states theoretical framework, this paper will argue that the direct control over SOFAZ exercised by the president and the lack of consultation with the NGOs have made corruption easier, making the task of economic diversification more difficult. This has been possible because through corruption the president has often resorted to oil money to buy peace rather than invest it in economic diversification. As a result, since the foundation of SOFAZ, the country is more reliant, not less, on oil.   Full text available at: https://doi.org/10.22215/rera.v8i1.223  

Systems of Governance and Politics of Opposition in the Super-Rentiers

2018 ◽  
Author(s):  
Courtney Freer
Keyword(s):  
Civil Society ◽  
Political Life ◽  
Political Environment ◽  
Popular Politics ◽  
Rentier State ◽  
Critical Information ◽  
Independent States ◽  
The Government ◽  
Legal Frameworks ◽  
Rentier States

This chapter provides a critical background on the country cases by examining their brief political histories as independent states. It also gives critical information about the legal frameworks of such states to highlight where and how Islamist groups can act in these states. By providing such descriptions, this chapter demonstrates the extent to which these states, in regime or popular politics, either adhere or fail to adhere to the government type and political environment normally associated with the rentier state. The chapter also reveals critical commonalities among the super-rentier states—they are governed by powerful ruling families; institutionalized political life is hampered; and civil society and political life remain largely informal—while also indicating their differences, which arose in light of their differing sociocultural and economic backgrounds.

The Role of Oil and Gas in the Economic Development of the Global Economy

2018 ◽  
Author(s):  
Paul Stevens
Keyword(s):  
Economic Development ◽  
Global Economy ◽  
Oil And Gas ◽  
Primary Energy ◽  
Oil And Gas Producers ◽  
The Future ◽  
History Of ◽  
Factor Inputs ◽  
The Impact

This chapter is concerned with the role of oil and gas in the economic development of the global economy. It focuses on the context in which established and newer oil and gas producers in developing countries must frame their policies to optimize the benefits of such resources. It outlines a history of the issue over the last twenty-five years. It considers oil and gas as factor inputs, their role in global trade, the role of oil prices in the macroeconomy and the impact of the geopolitics of oil and gas. It then considers various conventional views of the future of oil and gas in the primary energy mix. Finally, it challenges the drivers behind these conventional views of the future with an emphasis on why they may prove to be different from what is expected and how this may change the context in which producers must frame their policy responses.

What Hit and Miss in Indonesia CBM Project : Empirical Study Slowing Down Factors CBM Development and Propose Suitable Action for CBM Development in Indonesia by Using Analytical Hierarch Process.

2021 ◽  
Author(s):  
I.A. Firdaus
Keyword(s):  
Oil And Gas ◽  
Economic Value ◽  
Gas Production ◽  
Coal Bed ◽  
Production Sharing ◽  
High Investment ◽  
The Government ◽  
Exploration Period ◽  
Production Areas ◽  
Testing Standards

In 2008, the first Coal Bed Methane (CBM) PSC was signed in Indonesia. To date, 54 CBM PSCs have been awarded to explore and develop CBM Block in Indonesia. Twelve years later, only one PSC has submitted a Plan of Development but has not yet produced gas commercially. Most CBM PSCs have been struggling during the 10 years’ exploration period and some may receive extensions for 3 years under specific conditions. The lack of integrated authorities’ approval in the overlay of coal mining and natural gas production areas has become a great obstacle for CBM Development. Besides that, the government regulations in CBM activities have defects in PSC contract terms that may lead marginal economic value for contractors, especially due to high investment during the early development (C. Irawan, 2017). On the other hand, drilling regulations, Pipe Classing standards and Testing Standards following the Oil and Gas standards are too expensive for CBM Investment. According to our observations, CBM Regulations in Indonesia should be modified starting from the Exploration period, Production Sharing Contract Terms and Standard Operating Procedures to suit Indonesian CBM characteristics. Good coordination within government departments is a must for the success of CBM Exploration and Development.

Sign in / Sign up

Export Citation Format

Share Document