: Redistribute the
Windfall from
High Oil Prices.
he americas face multiple
and simultaneous challenges
in the coming years, ranging
from climate change and the
competition from the growing economies of China and
India to rising crime and narcotics trafficking. These issues
have been magnified recently
by the severe problems associated with rising oil and food
prices. But the challenges in
those two areas also contain
some unique and innovative
possibilities.
By acting in concert, we can
help alleviate the pressures
on the economies and societies of the world’s poorest nations. That will not only help
to minimize a growing global
crisis, but also reduce the risks
that food scarcity, poverty and
energy shortages pose to the
elected governments of the
hemisphere.
As a participant in several
international summits this
year, I became keenly aware
that global concerns must be
translated into viable public
policy options at the regional,
national and local levels. We
must develop local responses
to global issues, and global
concerns must respect local
and national priorities.
My recommendation to the
next U.S. president, therefore,
is based on the need to develop such a local response
to the twin problems of energy and food. The doubling
of the price of oil in the past 12
months has severely affected
developing economies such as
ours, with annual per capita
incomes of less than $6,000.
Collectively, these economies—whether located in the
Americas, Africa or Asia—
import around two million barrels of oil per day. At the same
time, the oil-exporting countries sell more than 50 million
of barrels each day, earning
them windfall profits of approximately $1.3 trillion in the
last twelve months alone. For
countries such as ours, this
has meant approximately $42
billion in additional costs.
1
Finding a way to pay this
extra money is only part of
the problem. With our already
high energy costs doubling,
we have found it difficult to
adjust our economies to cope
with our other pressing needs.
The price increases have
affected our entire production
apparatus. The sectors which
have been most affected
are electricity generation,
transportation, and food
production.
As our petroleum bills drain
our cash reserves—making
it more difficult for us to address the challenges facing
our countries—our problems
are aggravated by the fact that
the cost of foodstuffs is rising.
This has had profound effects
on the quality of life and the
livelihoods of all our citizens,
especially the poor.
The solution: invest a portion of the profits earned from
today’s high oil prices to benefit the countries that have
been worse hit by the multiple
price increases.
Our proposal is to first establish an alliance of these oil
importing nations and then to
search for global allies. Former
President Bill Clinton and former United Nations Secretary
General Kofi Annan have already expressed support. Our
hope is that other leaders, including youself, will join such
an initiative.
The principal aim of such an
alliance would be to recover
the cost of petroleum price
increases from oil-exporting
nations by asking them
to provide unconditional
grants and soft loans with
low interest rates and long-term payoffs that can be used
to undo the damage already
felt by our economies. Direct
investment could also be
another means of recovering
