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Daily Archives: September 18, 2019
How Indian and Chinese involvement in Africa differs in intent, methods and outcomes – Observer Research Foundation
Posted: September 18, 2019 at 4:22 pm
Chinese construction workers carry reinforcing rods on a building site in Algiers. Source: Pascal Parrot/Getty Images
Africa today is a continent of growth and opportunities. With a young, fastest growing youth population in the world and considerable natural resources and human capital at its disposal, Africa is poised to be a significant growth factor in the global economy. Positive winds of change are sweeping across the continent, which is now home to half of the top ten fastest growing economies of the world. Africa is an opportunity, one that is being shaped by and for the African people.
As Asias two largest economy, India and China have been able to tap into this emerging African opportunity. Both are shaping new narratives of engagement with Africa. But while much has been written and deliberated on when it comes to Indian and Chinese involvement in Africa, it is important to highlight differences in its methods of implementation and the impact it has generated on the lives of common Africans.
Chinese approach towards aid partnership to African countries is more traditional in nature focusing on resource extraction, infrastructure development, and elite level wealth creation. Such an emphasis on more traditional forms of aid through Foreign Direct Investment (FDI) on hard infrastructure projects might seem lucrative on the surface to many developing and small African countries who are always looking for quick and easy money, but is such an approach sustainable in the long run?
While certainly it is important to engage in nuanced debates on African debts that is not driven by Chinaphobia, one cannot deny the opaque nature of most Chinese contracts which are mostly not visible to or available for public scrutiny.
Over the past few years, China has funneled more and more money into Sub-Saharan Africa. As per estimates from China Africa Research Institute (CARI) at John Hopkins University, loans from Chinese government, banks, and contractors to African governments and state-owned businesses totaled US$ 143 billion between 2000 to 2017. Countries like Djibouti, Zambia, Democratic Republic of Congo and Angola have been identified as being at highest risk for debt distress. Low income countries are in danger of becoming locked into debt due to cheap and unsustainable Chinese loans.
Even more alarmingly, the opacity of the costs and terms of Chinese loans makes it difficult for countries to conduct risk assessment of the projects. While Chinese projects seems to serve the quest of African nations to build a sound infrastructure, a closer examination reveals that they serve Beijings ambitions to write the rules of the next stage of globalisation. According to Ted Bauman, senior research analyst at Banyan Hill Publishing, it is clear that Chinas primary goal with foreign investment is geopolitical and not economic. But the main trouble is that these investments helps to bind countries to China politically, and through debt obligations, creates a form of leverage. China is using its hefty economic prowess to build political soft power through its Go Out policy, wherein China sends its employees of its state-run companies to Africa, as well as investment money.
Moreover, there has been multiple concerns over Chinese labour practices, often viewed as unfair, with various cases reported of poor and harsh working conditions. The types of precarious labour conditions typically includes cases of low salary below the minimum wage standards, language barriers, unfair termination of contracts, lack of holidays, medical care, insurance, and other benefits.
Indias bilateral partnership with African countries can best be defined by the spirit of developing together as equals. Indian engagement lays emphasis on long term enhancing Africas productive capacity, diversifying skills and knowledge, and investing in small and medium-sized enterprises. Our special relationship is underscored by the fact that India was one of the first few countries, after the Hong Kong World Trade Organization Ministerial in 2005 that announced duty free, quote free access to low income countries back in 2008. Even during recession from 2009-2012, trade between India and Africa continued to grow nearly by 32%. Currently, for the year 2017-2018, our bilateral trade stood at US$ 62.66 billion, and during the first quarter of 2019 has reached US$ 69 billion.[i] In terms of investments, India is the fifth-largest investor in Africa with our cumulative investments standing at US$ 54 billion.
Although India and Africas economic relations are modest compared to China, India has numerous advantages, including proximity, a common language, popularity of Indian culture, and the appeal of democracy.
Our most prominent example of sustainable development partnership is reflected through International Solar Alliance (ISA). Africa has taken a leadership role in solar expansion with 25 member-states out of total 48 countries to ratify the agreement coming the African continent. Under the initiative, India has pledged to more than US$ 1 billion for implementing off-grid solar energy projects in Africa, especially in West African countries.
Also, with the enunciation of the Ten Guiding Principles for India Africa Engagement back in July 2018, the Indian Government has addressed the primary concern of not having a coherent Africa policy. For the longest time, India has been criticised for not having a clear vision or strategy for Africa, even after seventy years of robust engagement with the continent. Although many aspects of the Ten Guiding Principles are not new, they serve two purpose the Guiding Principles represents a continuity in policy that has historically defined India Africa partnership, and at the same time reflect a change in the nuances and priorities in our engagement. Most importantly, these principles have been clearly articulated, and can thus be seen as a vision document for India Africa partnership.
There is no doubt that Indian projects, capacity, and skills development programmes has positively impacted the lives of many Africans. However, at the same time, there is a realisation that our partnership is yet to reach its true potential. Indian engagement in Africa is not without its criticism. The principle concern has been Indias poor track record when it comes to project delivery and implementation. India is viewed to be slow in delivering on its development partnership commitments, especially in comparison to China. Also, few agribusiness firms have been criticised for land-grabbing and displacing local population. Cumbersome bureaucracy on both ends also makes it difficult for funds to reach its intended beneficiaries.
In such an instance, Indias main challenge is to bridge the gap between rhetoric and practice, and this is where India has made positive strides. Various commentators, analysts, practitioners have time and again questioned if India could live up to its lofty promises. The answer to that is yes.
As mandated by the 2015 Delhi Declaration of IAFS III, representatives of India and African Union met recently met on 11-12 September to take stock of the state of implementation of various areas of cooperation between India and Africa and deliberate on the preparations for IAFS IV to be held in 2020.
There were three important takeaways from the meeting;
-Firstly, the status of implementation from Indian side was welcomed by African Union representatives. Out of the total US$ 10bn Lines of Credit promised by India under IAFS-III, more than US$ 6.4bn LOC have been committed or ongoing.
-Second, out of the US$ 600mn target of grant assistance under IAFS-III, an amount of more than US$ 700mn has already been committed or ongoing.
-Third, India has completed more than 40,000 slots for training, scholarship and capacity building, out of the total commitment of 50,000 slots under IAFS-III.
In recent years, India has stepped up its game and completed various big-ticket projects in due time. These include: construction of Presidential Office in Ghana, National Assembly building in Gambia, Kosti Power plant in Sudan, Rift Valley Textiles factory in Kenya, water treatment projects in Tanzania, sugar factories in Ethiopia, and IT Parks in Mozambique and E-Swatini (Swaziland).
In the last four years, India has also established
These projects are examples of how Indian assistance is making a difference to the economy and lives of people in African countries. Now that Indias project delivery speed has improved, the foremost task at hand is to maintain the momentum, find new areas of cooperation, and regularly review progress through established joint monitoring mechanisms.
While Chinas economic muscle and heft in Africa is unmatchable, India does not see itself in a competition with China. At the same time, there is growing realisation in Africa that Beijings terms of engagement are less than desirable. This has given India a window of opportunity to take on more projects in Africa. Unlike China, Indias partnership with Africa is based on a model of cooperation that is responsive, demand-driven, free of conditions and one that liberates Africas potential, rather than constraining its future.
[i] The figure of US$ 69bn for India Africa trade in 2019 was stated by Dr. Neena Malhotra JS (E & SA) Division, Ministry of External Affairs, during an event discussion on The Ten Guiding Principles for India-Africa Engagement on July 19, 2019 at Observer Research Foundation, New Delhi.
The views expressed above belong to the author(s).
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Marymount University launches new intrapreneurship initiative to fill the region’s talent gap – ARLnow
Posted: at 4:22 pm
Marymount Universitys School of Business and Technology (SBT) has launched an initiative to address one of the most significant talent gaps in the greater Washington region a shortage of graduates who are prepared to use entrepreneurial skills to help employers grow and meet the challenges of an ever-changing world.
The Marymount Intrapreneurship Initiative (MI2, pronounced MI squared) is aimed at students who often feel left out from entrepreneurship programs because they want to use their entrepreneurial spirit and skills in existing organizations, rather than start their own. Intrapreneurship, defined as the application of entrepreneurial behavior to growth challenges in existing organizations, drives the growth of many successful area businesses in media, hospitality, government contracting, healthcare and information technology. Recent highly-publicized efforts in the region to drive workforce development have demonstrated a need for employees who can identify and address opportunities for growth, manage ambiguity and lead change.
Substantially all successful businesses are started by individuals who gained prior experience by using entrepreneurial skills to make their employers more successful, said Jonathan Aberman, Dean of Marymounts School of Business and Technology. Our region has grown through intrapreneurship, but it needs more graduates ready to hit the ground running.
Four primary areas will be focused on through the Marymount Intrapreneurship Initiative:
1.Incorporating concepts related to intrapreneurial skills into the SBT curriculum
2.Promoting intrapreneurship through community events
3.Executive and leadership skill development for personnel at existing organizations
4.Economic research and reports to study the role of entrepreneurial behavior and intrapreneurship in economic growth
Ive been working for a long time to help our region achieve its economic potential not by trying to emulate other regions, but by growing based on our strengths, Aberman added. Employers need a full pipeline of capable, visionary and technology-savvy talent that are ready and able to lead change and promote growth. We are looking forward to contributing our collective talents towards this challenge.
To fulfill its mission, the Marymount Intrapreneurship Initiative benefits from the leadership of Aberman, a well-known leader in the greater Washington regions innovation community.MI2also has an initial advisory board of 11 proven business intrapreneurs whose insights will shape Marymount SBTs intrapreneurial education, while adding their expertise to community events and educational offerings:
The launch of the Marymount Intrapreneurship Initiative is an important step in our Marymount Strategic Plan to promote innovation and position Marymount as a unique resource for our regions employers, said Dr. Irma Becerra, President of Marymount University. I am an intrapreneur myself, as I use entrepreneurial skills to lead change and growth at a very special university. Through my own life experience, I have demonstrated how people can use entrepreneurial skills to make a real difference. Our entire Marymount community is excited about this new initiative, and we are looking forward to addressing the growing technology talent gap.
Marymount is embracing the promise of a new economy that is increasingly driven by data, high-powered computing and entrepreneurship, said Dr. Hesham El-Rewini, Provost at Marymount University. MI2is one of several initiatives and academic programs we are developing to prepare the next generation of students and position Marymount as a reliable partner in this new economy.
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Posted: at 4:22 pm
Students and staff at the University of Sussex in Brighton have set up a new recycling initiative collecting second hand duvets to be given new life in childrens car seats and as equestrian venue flooring.
At the end of the academic year, duvets and pillows from the universitys halls of residence and summer schools will be collected and used for childrens car seat interiors and to cover floor surfaces in horse riding arenas. The fabric can also be used to fill new mattresses and some will be donated to dogs charities for bedding.
A report from the Waste and Resources Action Programme (WRAP)suggests that, despite there being 12,000 to 15,000 textile recycling centres across the UK. Because recycling rates are weight-based, the lightweight nature of duvets means they may not be considered a priority waste stream to divert from landfill by local authorities. As such, many end up being just thrown away.
The duvet recycling scheme at the University of Sussex, in partnership with Veolia, is one of a number of sustainable initiatives introduced by Geography student Megan Youngs during her internship year with SEF in the University Estates Team. Alongside the duvet scheme, she also helped introduce a Tetra Pak bin on campus and launched a partnership with recycling company TerraCycle, which collects cigarette stubs with the aim to recycle them into plastic products, while remaining tobacco or paper is composted.
Youngs, now in her third year at the university, has been shortlisted for Student Sustainability Champion of the Year at the Green Gown Awards. She said: It was really fantastic to be given the freedom and responsibility during my internship to put some of my ideas into action on campus. It was great to feel that I was making a difference and I really hope to see these schemes grow over the next academic year and see what other waste reducing and sustainability innovations the university can explore going forward.
Based in the green hub that is Brighton, the University of Sussex has seen a drive towards sustainability across the board.
Life Sciences Technician, Crispin Holloway, has contributed to the universitys sustainability goals by helping set up a collection scheme for the polystyrene boxes used to deliver scientific equipment on campus.
In Brighton and Hove, polystyrene is not collected at the kerbside, however, scientific equipment suppliers New England Biolabs (NEB) offer a return scheme whereby they donate 15 pence to the Woodland Trust for every polystyrene box returned to them by customers.
Currently, however, customers are only returning 18 per cent of polystyrene shipping boxes to NEB, something Holloway aims to change: We all now know about the serious damage single use plastics have on ecosystems and the environment. Our labs take deliveries of materials needed for research in polystyrene boxes. Some can be reused as ice buckets but the majority go to waste or worse, mistakenly put into recycling bins, contaminating all the recyclable waste.
Most polystyrene products are currently not recycled due to the lack of incentive to invest in compactors but thanks to the assistance and buy-in from colleagues and the support and know-how of Cat Fletcher we now have a solution to our problem through upcycling.
Cat Fletcher, the Brighton-based Co-founder of reuse site Freegle UK and winner of the 2019 Resource Hot 100, has established a new partnership to collect other non-returnable polystyrene boxes from laboratories on campus at Sussex that can then be reused and repurposed in gardening, for example.
The universitys catering organisation Sussex Food employs initiatives across all its cafes on campus and the team is always looking for further opportunities to reduce waste and recycle more, says Alison OGorman, Deputy General Manager.
Sussex Food has recently been noted as one of the top collectors of crisp packets in the country as part of another link-up with Terracycle.
Forty-five thousand crisp packets, which are notoriously difficult to recycle due to their composite layers of plastic and metal, have been collected on campus and extruded into plastic pellets. The aim is to use these pellets to make new recycled products. However, on a wider scale, crisp packet recycling is not economically viable and research is being undertaken to explore alternative packaging materials for crisps, using amino acid nanosheets.
As well as recycling crisp packets, OGorman says: We participate in the Simply Cups scheme where our collected cups are reformed into stationary and furniture. Our Mug for Life, which includes giving away cups for life to freshers each year, has increased reusable cup use up to 35 per cent and we have ambitions to make that 50 per cent or more by September 2020.
We now have three sites which have taken the plastic free pledge and we are purchasing an aerobic digester to turn our food waste and take away packaging into material suitable for Biomass heating systems and as a fertiliser for use on campus which will create a circular economy for this waste stream.
PMI Study Reveals Top Productivity-Boosting AI Technologies, According to Project Managers – Yahoo Finance
Posted: at 4:22 pm
Project Management Institute (PMI) today released its 2019 Pulse of the Profession In-Depth Report: AI @ Work: New Projects, New Thinking. The report, a companion piece to AI Innovators: Cracking the Code on Project Performance, explores how artificial intelligence (AI) is changing the way projects are managed and delivered globally.
As AI projects become the norm, project managers need to better understand what technologies will help them streamline and improve their AI-based project work -- or they risk being left behind. The new report highlights the top AI technologies project leaders are currently leveraging to boost project management productivity, and how to incorporate AI technologies into their overall project work.
While project leaders are tapping into AI technologies to boost project productivity and quality, unlocking AIs full potential requires building and constantly refreshing knowledge of emerging technologies. In fact, the report finds that organizations and their project leaders will need a high Project Management Technology Quotient (PMTQ) a way of evaluating an organizations ability to manage and integrate technology based on the needs of the organization or the project at hand to turn AI strategy into reality.
In todays increasingly project-based economy, the most forward-thinking organizations know that the success of their strategies hinges on how well they can execute projects. And the race toward AI mastery is no exception, said Michael DePrisco, vice president of global solutions at PMI. As we see AI technologies continue to be integrated into organizations, the research indicates that project managers, especially those with a high PMTQ, are well prepared to play an integral role in implementation.
Of the respondents to the study, 50 percent reported a high PMTQ (Innovators) and 10 percent reported only sometimes or never practicing the principles of the PMTQ (Laggards).
A majority of both groups say their project management skills and experience are a good foundation for managing AI. But the Innovators have the upper hand: 74 percent of Innovators say theyre confident their current skill set enables them to work with AI, compared with 51 percent of Laggards.
Even more so, Innovators cite having more awareness and experience with several AI technologies, including knowledge-based systems, decision management, speech recognition, and expert systems. These respondents also report delivering better outcomes when using AI technologies, including a decreased amount of time spent on activities like monitoring progress, managing documentation, as well as activity and resource planning.
The top technologies respondents cite as enhancing productivity are:
The top technologies respondents identify as increasing quality are:
While it is clear AI can make a difference in value delivery, it is up to organizations and their project leaders to identify and understand which technologies can best help them achieve their specific goals and deliver long-term success.
Read more about 2019 Pulse of the Profession In-Depth Report: AI Innovators: AI @ Work: New Projects, New Thinking. The Pulse of the Profession In-Depth research was conducted online in June/July 2019 among 780 project management practitioners globally.
About Project Management Institute (PMI)
Project Management Institute (PMI) is the world's leading association for those who consider project, program or portfolio management their profession. Founded in 1969, PMI delivers value for more than three million professionals working in nearly every country in the world through global advocacy, collaboration, education and research. We advance careers, improve organizational success and further mature the project management profession through globally-recognized standards, certifications, communities, resources, tools, academic research, publications, professional development courses and networking opportunities. As part of the PMI family, ProjectManagement.com creates online global communities that deliver more resources, better tools, larger networks and broader perspectives. Visit us at http://www.PMI.org, http://www.projectmanagement.com, http://www.facebook.com/PMInstitute and on Twitter @PMInstitute.
View source version on businesswire.com: https://www.businesswire.com/news/home/20190912005049/en/
Posted: at 4:22 pm
Landscape architecture can mitigate carbon emissions, but it is also implicated amoung the causes.
This week, LAM is joining more than 250 media outlets for Covering Climate Now, flooding the zone, as it were, with climate coverage in the run-up to the United Nations Climate Action Summit on September 23. Landscape and landscape architecture are deeply implicated in the future of climate progress, or a lack of it. Over the past decade, LAM has dug into climate issues of landscape in numerous dimensions, mapping the big resource picture as well as local attempts to fend off increasingly apparent hazards of global warmingfrom the procurement of materials to the integrity of the food supply chain. Each day this week well bring you excellent stories from recent years that follow landscape architects acting and thinking about climate change and the landscape.
The Paris Agreement on climate change, created by the consensus of 197 nations, went into effect in November 2016 and has enormous implications for the practice of landscape architecture. If adhered to by its signatories, the agreement signals the end of the fossil fuel era by midcentury, well within the life spans of many landscape architects currently practicing. Though it may seem wonderfully green, this energy transition poses profound questions for the practice of landscape architecture at a time when the discipline is needed more than ever.
The Paris Agreement foretells a civilization powered nearly exclusively by renewably generated electricity, not fossil-fueled fire, like today. This will impose severe limits on landscape architectures materials, construction methods, and professional mobility. The agreement also portends a society with much less energy overall, as fossil fuels currently make up more than 80 percent of total energy consumed and cannot be easily replaced. These stark realities will challenge landscape architects to adapt to the impending zero-carbon future.
Last year set the record for the hottest year in measured history, breaking 2015s record, which itself broke 2014s. The earth is rapidly warming owing to the use of fossil fuels, which spew huge amounts of carbon dioxide (CO2) into the atmosphere. Annual global mean surface temperatures are already close to 1 degree Celsius higher than preindustrial levels. Ominously, average temperatures in some months of 2016 were more than 1.5 degrees Celsius above preindustrial levels. This means the planet is now approaching the upper range of temperatures that have existed for the past 10,000 years. That stable climatic period, the Holocene, coincides with the development of human civilization. If humans continue to heat the planet, civilization will be moved outside of its known safe operating space.
To avoid this scenario, the Paris Agreement seeks to hold global warming to no more than 2 degrees Celsius above preindustrial levelsand to pursue efforts toward a more ambitious limit of 1.5 degrees Celsius. Alas, the climate is already near that threshold. If anthropogenic warming continues at this rate, the global temperature could increase by as much as 4 degrees Celsius within this century. This would result in a climate that has not existed on earth for millions of years, far longer than the 200,000 or so years that modern humans have been around.
A recent report by the Intergovernmental Panel on Climate Change found that the last time the earth was that warm, about 125,000 years ago, sea levels were 15 to 30 feet higher than today. That amount of sea-level rise now would lead to a radical reshaping of the earths coastlines, affecting hundreds of millions of people and all of the global economy, over a ridiculously short time frame. With an increase of 2 degrees Celsius, global farming would also be dramatically affected by either too much or too little water and destructive storms.
The incredible impacts associated with this heating would likely disrupt the lives of hundreds of millions, perhaps billions, of people, potentially leading to severe and perpetual conflicts.
It must not get to that point. The Paris Agreement plots a path to ensure that it doesnt. As a first step, the world economy must cease annual increases of CO2 pollution. This has occurred over each of the past three years, possibly attributable to energy efficiencies, increases in renewable energy, and the retirement of many coal-fired power plants. The next step, however, is more difficult: getting annual CO2 production to near zero within the next 30 years. This is the largest challenge, because the industrial economy measures growth by increasing, not decreasing, CO2 emissions every year. The final step will require simultaneously offsetting all small but unavoidable CO2 emissions to achieve a net balance of zero carbon emissions. Doing all this, right now, will result in a two-thirds chance of limiting temperature increase to no more than 1.5 degrees Celsius. Those are humanitys best odds.
How will our enormous civilization and economies be powered, if not with fossil fuels? The answer: renewably generated electricity. This has two implications for landscape architecture. First, within our lifetimes, there will likely be significantly less energy to use than today. And it means the end of most carbon-fueled fire, upon which much of current landscape architecture practice depends. These implications will fundamentally change landscape architecture.
A world without fossil fuels will be an all-electric one. Renewable energy technologies, such as solar panels and windmills, produce electricity. Fortunately, much of the world is already wired for electricity. However, it is a mistake to assume that all that is needed is to swap fossil fuel-powered energy generators with renewable ones. It is not a matter of simply unplugging dirty energy and replacing it with green renewables.
The first problem confronting us is the sheer scale of the energy that needs to be replaced. Today, only about 10 percent of the United Statess energy comes from renewables. Nuclear power provides about 9 percent of the energy in the United States, but this means that 80 percent of our energy is derived from fossil fuels. This is the scale of the problem: transforming renewables from 10 percent of our energy use to at least 90 percent. This is a staggering task, yet one that will need to be done within 30 years to meet the agreements goals.
Unsurprisingly, there are no real-world simulations as to how this will be possible. Still, the need to quit fossil fuels is growing every year. Therefore and soon, while fossil fuels are being phased out, there may not be any near-termand possibly not even long-termreplacement of that lost energy.
Renewably powered energy has some known limits. Intermittency is obvious: The sun doesnt always shine nor does the wind always blow. That leads to the second limit: storage. There are currently no industrial-scale technologies that can store large amounts of renewable energy. The third limit springs from the first two. The existing electric grid is a centralized system, sending out energy as it is needed to where it is needed, whereas renewable energy sources are scattered and intermittent. All this indicates that meeting current energy demand with renewables will require extensive, and expensive, system redesign.
Other issues remain unresolved. To generate anything near current energy consumption, an all-renewable future will require enormous spatial footprints of solar and wind factories. Although the switch to renewables may be ultimately positive, there will likely be serious economic, environmental, and social ramifications with these fixtures sprawling across the earth and seas.
Then again, visions of large-scale renewable energy factories may be a mirage. There is no proof that the mining, transport, and transformation of raw materials into renewable energy collectors, nor their installation, can be done without fossil fuel inputs. It is not idle speculation to ponder if an industrial-sized windmill can be used to generate all the energy needed to make another industrial-sized windmill from scratch.
So, while it is not possible to estimate exactly how much energy will be available in an all-renewable future, it will likely be significantly less than we have been accustomed to. Limited energy availability, and the resulting high cost, will pose ethical questions for landscape architecture practitioners: For what projects, and for whose benefit, shall we use that limited energy?
Energy limits are one side of the transition. The other side reveals the energy substitution challenges landscape architects face. Renewable energy simply cannot do all of the things that fossil fuels can. Right now, carbon-based fire is at the core of the economy, powering most of societys primary machines, transportation, and much manufacturing. Renewable energy is not fire and cannot be used like fire.
For landscape architecture, the end of fossil-fueled fire is critical to materials and construction methods. Many of the primary building materials used by landscape architects require high temperatures that are primarily made with fossil fuels and that do not have a ready renewable energy substitute. Producing cement and steel requires extremely high temperatures presently achieved by the direct burning of fossil fuels. There have been experiments in developing methods to use electricity to create the needed temperatures, but there is no guarantee that there will be significant amounts of electrically made cement and steel in the future.
Additionally, there is no way to eliminate the release of large amounts of carbon dioxide that occur simply as a by-product of the production of cement, steel, and plastic. In the zero-carbon future, all the carbon released from such industrial processes must be directly offset through sequestration in plants and soil. This may be minimal, given the imperative to restore a stable climate by drawing excess carbon from the atmosphere, not simply by attempting to balance current emissions.
The ultimate result is that, in our all-electric future, there will likely be much less of the building materials we use now. This raises other ethical questions for landscape architects: For whom and to what purpose should these limited materials be used?
An all-electric future also directly affects current construction methods. Carbon-fueled machines are taken for granted on most projects. Without fossil fuels, heavy machinery must be powered with either electricity or some combustible substance such as biodiesel. It is not feasible to electrify these machines using a fixed electric grid; imagine an excavator or backhoe connected to an overhead power line or even a power cord. Also, it appears that switching heavy machines to electric battery power is not possible given the physics of batteries. Alternative fuels such as biodiesel will likely be limited as well. Scaling up biofuels to come anywhere near the 35 billion barrels of oil a year the global economy currently consumes could negatively affect food production as energy crops are substituted for food crops.
Future travel of significant distance will also be at the mercy of electrical grids and even the wind. Trains and sailing ships will likely have a future, while airplanes and long-haul trucks might not. This will determine material choices and supply chains, but also the ability to serve clients. The travel radius imposed by the zero-carbon reality may be considerably smaller than today.
Landscape architects might wonder if these stark implications are just fake news. Unfortunately, climate change is not a hoax, and neither are the limits of an all-renewables-based economy. There appear to be no solutions to our predicament if we continue to burn fossil fuels. Current carbon emissions cannot be mitigated through massive tree planting. To do so would take tree planting over an area larger than the state of California just to offset one years global carbon emissions. We will run out of planet on which to plant trees, let alone food, before we run out of fossil fuels. While both reforestation and afforestation, in appropriate landscapes, are vital responses to global warming, their primary value is in drawing down carbon from the atmosphere, not masking massive emissions.
The various rating systems, known by their acronyms, are not a complete answer at this point. These systems rely on carbon efficiency as one measure of compliance in supposedly green projects. Carbon efficiency is important in the short term, but it is not the same as zero carbon, which means all carbon emissions on every project are directly balanced by documented sequestration in plants and soils.
Finally, there is a persistent belief that there are technological solutions to our predicament. But technology is not energy. Technology simply allows society to exploit energy in ways deemed beneficial. Ultimately, there appears to be no realistic technology that will allow society to keep burning fossil fuels without unimaginable consequences.
Our society is in the early stages of an epochal transition. The shapes and limits of the near future are becoming clear owing to the needed and urgent responses to climate change. However, even if nothing meaningful is done in response to climate change, humanity still faces the realities of resource depletion and ecosystem destruction. Addressing these crises is equally as vital as addressing climate change. For even in climate denial, those issues will remain, and then the climate will have been heated, perhaps intolerably. There is no escaping what Robert Louis Stevenson once termed the banquet of consequences.
Ultimately, the Paris Agreements imperative to end the fossil fuel era presents several fundamental questions for practitioners and teachers of landscape architecture, the answers to which may determine the fate of the profession. Some of these questions are: What is the essence of landscape architecture? Who benefits from landscape architecture? How is the work of landscape architecture done? How do the products of landscape architecture evolve? The longer it takes to address these questions, the more difficult it will be to adapt to the zero-carbon reality.
The world needs landscape architects more than ever, to help society adapt to climate change, to assist efficient and artful carbon drawdown, to restore ecosystems, and to improve quality of life for people. Yet, many of the tools and processes now considered essential to those tasks soon wont be available because of carbon limits. Landscape architects must learn instead to work within the parameters of the zero-carbon future. In doing so, they will gain the practical experience and, more important, the moral authority to be the leaders of the climate-saving energy transition.
Steve Austin, ASLA, teaches landscape architecture, urban planning, and construction law at Washington State University.
This story is part of Covering Climate Now, a global collaboration of more than 250 news outlets to strengthen coverage of the climate story.
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Livent and E3 Metals Announce Joint Development Agreement to Advance Lithium Extraction Process and Technology – Yahoo Finance
Posted: at 4:22 pm
PHILADELPHIA, Sept. 18, 2019 /PRNewswire/ --Livent Corporation (LTHM) is pleased to announce a collaboration with E3 Metals Corp. (ETMC.V) ("E3 Metals") whereby the two companies will seek to advance the development of E3 Metals' proprietary direct lithium extraction process. Work under this agreement will focus on E3 Metals' petro-lithium brines located in the Leduc Formation in Alberta, Canada.
Livent Corporation (PRNewsfoto/Livent Corporation)
Livent will contribute its technical expertise and up to US$ 5.5 million to the joint development project. In exchange, upon completion of the project and satisfaction of the full US $5.5 million in funding, Livent will have the opportunity to convert its investment into a 19.9% ownership stake in E3 Metals and appoint one member to its Board of Directors, provided Livent maintains not less than a 5% equity interest.
Paul Graves, president and chief executive officer of Livent commented, "Livent has been a pioneer in the lithium industry for over 60 years. Collaborating with E3 Metals provides an opportunity to build on our rich heritage of innovation and to bring exciting new possibilities to our customers around the world."
About Livent For more than six decades, Livent has partnered with its customers to safely and sustainably use lithium to power the world. Livent is one of only a small number of companies with the capability, reputation, and know-how to produce high-quality finished lithium compounds that are helping meet the growing demand for lithium. The company has one of the broadest product portfolios in the industry, powering demand for green energy, modern mobility, the mobile economy, and specialized innovations, including light alloys and lubricants. Livent employs approximately 800 people throughout the world and operates manufacturing sites in the United States, England, India, China and Argentina. For more information, visit livent.com.
About E3 Metals Corp.E3 Metals is a lithium development company with 6.7 million tonnes lithium carbonate equivalent (LCE) inferred mineral resources1 in Alberta. Through the commercialization of its proprietary ion exchange lithium extraction technology, E3 plans to quickly move towards the production of high purity, battery grade, lithium products.
E3 Metals combines a significant in situ resource and innovative technology solutions that have the potential to deliver lithium to market in one of the best jurisdictions in the world. The development of this lithium resource through brine production is a well-understood venture in Alberta, where this brine is currently being produced to surface through extensive oil and gas development.
For more information about E3 Metals, visit http://www.e3metalscorp.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain statements in this news release are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," "potential," or "continue," the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about Livent, may include projections of Livent's future financial performance, Livent's anticipated growth strategies and anticipated trends in Livent's business. These statements are only predictions based on Livent's current expectations and projections about future events. There are important factors that could cause Livent's actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including a decline in the growth in demand for electric vehicles; adverse global economic conditions; the success of Livent's research and development efforts; volatility in the price for performance lithium compounds; risks relating to Livent's planned production expansion and related capital expenditures; reduced customer demand, or delays in growth of customer demand, for higher performance lithium compounds, the potential development and adoption of battery technologies that do not rely on performance lithium compounds as an input; risks inherent in international operations and sales, including political, financial and operational risks specific to Argentina, China and other countries where Livent has active operations; customer concentration and the possible loss of, or significant reduction in orders from, large customers; failure to satisfy customer quality standards; fluctuations in the price of energy and certain raw materials; failure to achieve the expected benefits of Livent's separation from FMC as well as the other factors described under the caption entitled "Risk Factors" in Livent's 2018 Form 10-K filed with the Securities and Exchange Commission on February 28, 2019, the first quarter 2019 Form 10-Q filed with the Securities and Exchange Commission on May 8, 2019, and the second quarter 2019 Form 10-Q filed with the Securities and Exchange Commission on August 7, 2019. Although Livent believes the expectations reflected in the forward-looking statements are reasonable, Livent cannot guarantee future results, level of activity, performance or achievements. Moreover, neither Livent nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Livent is under no duty to update any of these forward-looking statements after the date of this news release to conform its prior statements to actual results or revised expectations.
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Posted: at 4:22 pm
The majority of plastic that is produced becomes waste. Considering how plastic can take up to 500 years in order to decompose, recycling must take precedence and reduce the negative impact that this material can have on our planet. However, not all types of plastics are recyclable. For example, black plastic food trays are still impossible to recycle and tend to end up as waste.
The PowerHouse Energy Group is taking these non-recyclable plastics and turning them into raw materials (feedstock) which can be converted into gas. In order to do this, the British start-up has created the DMG System, which carries out this process in an environmentally responsible and economically viable manner. The DMG technology can actually be used to dispose of a wide range of waste products by using them as feedstock. This is subsequently converted into their EcoSynthesis Gas during a combustion-free process.
Their technology leaves a minor footprint which utilizes less than half an acre, making it ideal for a variety of situations. On top of that, the gas produced by PowerHouse Energy is in turn able to be used to produce chemical precursors, enables extraction of a stream of ultra-pure hydrogen gas, or is capable of generating electricity for use within a business enterprise.
Innovation Origins talked with director David Ryan about the 8- year-old start-up and the challenges of bringing this technology to the market.
We are a waste-to-energy technology company, we are focusing on regeneration of non-recyclable plastics and old components for the production of a clean gas that can be used as a replacement for natural gas in energy generation. Or alternatively, for where there is a market for hydrogen use as a resource. We do this by separating hydrogen from the gas so as to produce hydrogen which is compatible for fuel cells.
Okay, non-recyclable plastics are typically plastics that are contaminated or those for which there is no current recycling scheme. At present, these include black food plastic trays or the hard plastic that we use for garden furniture and such like. Generally, there is no recycling available for these and these kinds of plastics will most likely end up in a landfill.
So, that sort of defines what feedstock is. What we do with it is: we introduce the feedstock into a controlled environment and then melt down the plastics until they are vaporized. We monitor the environment so that we eventually break down all of the long chain hydrocarbons, which gives us a mixture of gas principally made up of methane, carbon monoxide and hydrogen.
Technically, the unit we are currently working with has a capacity for 25 tons, but in our planning application for the first site, we have actually asked for the site to have a capacity of 40 tons. We think that the process will scale up to 40 tons, to a certain extent the process will work better this way.
However, at the moment the plant is working with 25 tons per day. It is a module plant and its a bit like it was dropped out of the back of a lorry. What I mean is that the main process unit itself is a bit bigger than a container, but only just a bit bigger than a container.
That would be a volume of about 30 square meters of gas, 30 to 35 depending on the sort of plastic. The gas has about the same sort of energy value as natural gas. That varies from 30 to 40 megajoules per kilogram.
In the UK and in many parts of the industrial world, it would normally come from plastic recycling companies. Commercial and domestic waste goes to a major recycler. It first gets sorted in a municipal facility. Then it goes on to a plastic recycler who does a more careful selection of the plastic that they want. Lastly, what comes to our process is the plastic they are unable to use. It usually has been through three levels of sorting before it reaches our PowerHouse equipment.
No, no. We are currently developing our first site here in the UK because this is where we are based. But it could be anywhere, and we carry out analysis of feedstock at each location so as to make sure that we are able to fine-tune the chamber conditions for the plastic in those countries. Because plastic, and how plastics are used, does vary from country to country.
We are closer to the old form of municipal gas, before natural gas was ever used. This means we have carbon monoxide content, as well as methane. As such, in some ways it seems like I am going back to the future by generating a municipal gas. Some parts of the world are looking into shifting towards a hydrogen economy. And this is one of the ways for switching over to a hydrogen-based economy, as we are already using a greater proportion of hydrogen in the gas stream.
Yes. So, typically we can produce a volume of between 1 and 2 tons of hydrogen for fuel cell-powered trucks and shipping vessels. Therefore, one ton of hydrogen provides enough fuel for 30 trucks covering 300 miles. Normally, we would replace diesel, which has a daily production of about 70 tons of CO2. And a fuel cell-powered truck only produces water, there is no pollution.
The company should not have gone to the market when it did, which was without the technology. So, there was and is always the market expectation that were ready to go. While it takes such a long time to develop the technology. That was one. The biggest challenge is then securing sufficient funding in order to complete the research and development phase. And at the moment, my biggest challenge will be building the first factory. We have a demonstration-sized plant, but we have to build a full-sized commercial plant. Building that thats my next challenge.
Yes, and the laboratory and the desk engineering and such like. We are confident in the scale-up. Think about it, if you consider that we are introducing a huge amount of plastic into a chamber which it is about 800 degrees C, it is not such a technical challenge to envisage how the plastic will melt and turn into gas. This is why the scale-up issue is, in fact, related to the characteristics of the gas. As in, we need to make sure that the gas we are seeking in the commercial plant, is going to be exactly the same that we find in the demonstration plant. Although we do have a more synergistic approach. We check the work that we are currently carrying out and are using it as a benchmark.
Getting the gas, producing the gasses. We did the desk engineering, the theoretical models and then went on and did the actual demonstration so as to prove that we were getting a syngas comprised of more than 60 percent hydrogen. This is good for precision-engineered hydrogen production. That was fantastic.
The actual commercial contract we signed for our first factory that felt pretty good as well.
This year we are applying for a permit for the first block of land. We are also h0ping to secure funding for 11 plants. Which means that I am talking to pension investment advisors and investment companies, etc., with the aim of funding a UK pipeline for 11 projects. And then next year I will be looking into developing 2 or 3 other sites.
We have a unique product, there are similar companies working on waste oils, although at present, no one else seems to be busy with the waste gas route, specifically not with hydrogen. In this case, we see ourselves as the pioneers within the hydrogen economy.
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Posted: at 4:22 pm
The importance of data has been talked about again and again. Data is being rightfully called as a resource by many and has been compared to oil. You cant actually see data like you can see other commodities. Also, no one talks about the term Data Industry like there is Oil Industry. Most data companies are viewed as tech companies. I want to give a different perspective of the data industry by comparing it to oil industry as more people understand about oil industry. Also, if we are talking about data as a resource I will write about data resources of India.
Data industry comprises of a lot of companies that use data as a key resource or raw material. Majority of famous tech companies these days are data companies. These companies are called tech companies because we only see their technical products. Most of these companies have built modern systems that collect, process, extract and deliver data. That is a key part of their business and technology.
Statement 1: Data companies are those that use data as a raw material. In general, these companies process data for different use cases and make a product or make a product to gather data and then process data. These companies are worth more than a trillion dollar. Compare it with oil, where crude oil is the raw material, it is processed with the use of heavy machinery and then made into suitable products. Very similar. However, the trading procedure of crude oil is properly defined.
Inference: Data is a valuable resource like oil. You might have read it online before as well nothing new here.
India is very very diverse country with 1.3 billion people. From nature to humans we have a lot of data compared to other countries. We are literally sitting on a data mine. If data is a resource like other resources, that should put us in a strong position globally in the data industry. You would assume that our data is being protected and we are making good amount of money from our data resources. Sadly, this is not the scenario. In fact, the situation is completely different. Although, this is a global issue not specific to India.
Personal data of billions of people in India has already been taken over by large multinational companies. These companies have built great platforms. Can you imagine this thing happening with oil, that a company just comes to India takes oil and says:
Hey, we are going to sell you petroleum out of it, thank us later.
Current laws and regulations are centered around how the company that has collected data, uses the data, that is, processes or extracts the data. One noteworthy thing is that there is no compensation to the data provider. The government is also not benefiting from this trade. Also, these companies are easily able to justify their actions based on current laws and regulations. Most of the companies would term themselves as advertisement companies but are actually data companies, rather data collecting companies. Also, the collected data is sold to many other companies/partners for a lot of money. Again, the data provider gets no monetary compensation. This is also due to the fact that there arent properly defined data trading laws and markets. I am pretty sure there is a black market for data, although I havent verified the claim.
Data drain: Collection of data from Indian citizens to the servers of these companies, located in a few world leading countries.
Statement 2: Crude oil is sold as a raw material. It is sold as a commodity. Data in India is just being collected, processed and sold without the people of India or the government getting anything out of it. This is data loot. Although law doesnt categorize it as loot and we are not being forced to give away data. Its just that we are being tricked.
Imagine this happening in the colonial era, colonial powers coming to India, getting all the raw materials, making products out of it and selling them to us. In my opinion, it is a fair comparison.
When will we start valuing our data resources?
In the current system we look really stupid. The problem with data is that, it is not matter and most of the people who are above voting age dont understand its value. I dont blame them. People are giving away their data for free.
What answers would we give to our future generations?
To them it would be like, we had a lot of data, we didnt know how to use it or process it. We gave it away for free. But hey, we had a lot of data.
China has very effective policies to monitor personal data of their citizens and their country, in general. Many people call it autocratic rule, but again we only see or find out about China what these data companies want us to.
India is a data hub, we have more than 1.3 billion people. We need to protect and safeguard our interests in this regard. We still have a lot of data that needs to be protected. This would be when people actually start realizing the worth of data. I dont see this happening anytime soon.
The main point: With China almost restricting access to its data resources and India being a data hub, it gives us an excellent opportunity to take initiatives on a global level to start developing an ecosystem where the 3 involved parties, the corporates, the government and data providers benefit more. The world needs an open platform where data can be traded freely, entities buying data arent scrutinized for their usage of data and also data providers get compensated. This will open up a lot of employment opportunities, keep the companies happy and a lot of other consequences. This will give a major boost to our economy. Although, again I dont see India taking this step, perhaps the EU will do something.
Statement 3: Many algorithms (all AI/ML algos) require data for development. These algorithms in turn help in generating profit. I think it is fair for data providers to get some monetary compensation for providing data. It could be achieved via data royalty.
There could be data royalty programs which provide royalty to data providers based on the value of their data. This itself is a very big opportunity. There could be data banks to store data. Data royalty would also suppress these powerful multinational giants and ensure monetary compensation to data provider. Although most people wont understand data royalty at first and it would require much more time to explain, its a thing for future. The first step is in accepting that there is an issue that needs to be addressed.
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Posted: at 4:22 pm
Alaskans worried that BPs sale of its Prudhoe Bay assets to Hilcorp means Alaskas oil and gas potential is waning can be reassured: Hilcorps growing strength is just the beginning of a new wave of investment and activity heralding a more energetic phase in our resource-rich states top industry. Here are a few examples.
When we faced a potential gas shortage in Cook Inlet in 2012, Houston-based Hilcorp was purchasing mature fields from Chevron and Marathon. Hilcorp then embarked on a vigorous drilling and efficiency program, increasing oil and gas production and ensuring reliable energy supplies for Southcentral Alaska.
Hilcorp next took their plan north, buying in to four of BPs North Slope units in 2014. Most recently they began producing viscous oil from their Moose Pad at Milne Point, increasing field production to levels not seen in years. With declining oil throughput in the trans-Alaska oil pipeline, Hilcorps aggressive strategy is delivering the kind of results Alaskans need, and the jobs critical to our economic security.
Oil Search, a Papua-New Guinea independent new to Alaska, is systematically, deliberately and thoughtfully pursuing its Pikka development, aiming to start oil production in under four years. Pikka will create high-paying jobs and boost state royalty revenue, and could increase pipeline throughput up to 2%. Oil Search and its partners Armstrong, a Colorado independent, and Repsol, a Spanish global oil company, have several other North Slope prospects that may not be far behind.
U.S. major ConocoPhillips may bring its Willow prospect online about the same time as Pikka, increasing oil production by a similar amount. This expansion of development westward from Alpine and Greater Mooses Tooth into the National Petroleum Reserve-Alaska will add critical infrastructure, making other western prospects more commercially feasible.
London-based newcomer Premier Oil, in partnership with Australian independent 88 Energy and Texas independent Burgundy Xploration, plans to drill this winter to further evaluate a block of leases called Project Icewine, 50 miles southwest of Prudhoe Bay. Weve known since the 1960s this area holds potential for oil discoveries, and these optimistic independents believe they can bring this prospective area into production.
Other veteran and new independents have big exploration and development plans. We saw expressions of interest at CERAWeek last March, and Im confident well see evidence of that interest at the states North Slope areawide lease sale on Dec. 11.
Lease sales generate immediate revenue for Alaskans through lease sale bonus bids and rents, and are the third-largest source of revenue generated by the Division of Oil & Gas, after production royalties and net profit shares. Last year, lease sales brought in over $28 million to support the General Fund, Alaska Permanent Fund, and others.
Along with its regular lease offerings, the State plans to offer three Special Alaska Lease Sale Area (SALSA) blocks. These contiguous lease blocks represent a unique opportunity to acquire lease rights combined with a trove of associated well and seismic data and other information compiled by the State. The intent is to jump-start a companys understanding of the North Slope and thereby accelerate drilling and development plans.
Also in December, the Bureau of Land Management will offer leases in the NPR-A and, for the first time ever and after decades of waiting, tracts in North Americas most prospective onshore prospect: the coastal plain of the Arctic National Wildlife Refuge.
Clearly, there are many reasons to be optimistic about the future of oil and gas in Alaska. New technologies, new investments and new players will add more jobs in the industry, more money in the economy and state treasury, and put more oil in the pipeline. Last winter was the North Slopes busiest in 15 years. That trend continues.
James B. Beckham is acting director of the Alaska Department of Natural Resources Division of Oil & Gas.
James B. Beckham is acting director of the Alaska Department of Natural Resources Division of Oil Gas.
Posted: at 4:22 pm
Oil and Rentier States: How Falling Oil Prices Will Affect the Middle East
Less than a decade after weathering massive geo-political upheavals from the Arab Springs, the Middle East is on the verge of yet another crisis; the plummeting price of crude oil. Rentier states in the Middle East, have for several decades, secured their status-quo by building an overwhelming portion of their economy dedicated to the sale of crude oil.[i] While the rentier system has been successful in propping up Middle Eastern governments for decades, the downside to this system is the economic and political uncertainty created by the rapidly changing value in a single commodity.[ii] With an anticipated drop in the price of crude oil, the recent stability of the Middle East is likely to become vulnerable as governments begin to experience a significant economic downturn.
The term rentier state comes from the sale of rents, or single commodities, established to fuel a states economy and overall political structure.[iii] For example, a form of universal basic income exists in Kuwait; while this placates the middle class and prevents upheaval, it is only made possible through the sale of massive amounts of its countrys natural resources.[iv] Conventional wisdom suggests the primary recipients of these consequences will be the oil exporting countries such as Saudi Arabia, the UAE, and Kuwait. However, non-rentier states such as Jordan and Egypt find themselves at large risk for upheaval as well; oil profits from rentier states have been subsidizing major parts of the economies of neighboring nations in order to foster alliances and stability.[v] Thus, an oil crisis is set to affect not just rentier countries, but virtually the entirety of the Middle East. The purpose of this project is to analyze the consequences of a possible permanent drop in oil prices, and the possible follow-on effects to the stability of Middle Eastern governments. It is important to note that the Middle East isnt just facing an immediate crisis from the immediate drop in prices, instead it is a long term problem that will take decades to return from.
This paper examines the likelihood of conflict in a given nation caused by falling oil prices. First, a correlation between falling oil prices and instability are determined by examining trending data analysis. Second, in order to determine how negative economic factors can contribute to political instability the Human Development Index (HDI) is measured against political instability, coupled with the GDP per capita being measured against the likelihood of conflict in a given area. Third, the estimated value of crude oil is determined from available open source data on projected oil values. Fourth, case studies of the UAE and Egypt are used to predict likely real-world outcomes based on previous trends from both Gulf and non-Gulf states in the Middle East. Finally, anticipated long-term impacts, consequences of falling value, and preventative measures provide an outline for progress moving forward.
Human Development vs Political Instability
The World Banks Human Development Index (HDI) is a collection of data used to track overall progress of a nation regarding the welfare of its people. It combines life expectancy, education, per capita income, etc., to give an overall picture of a nations health. Political stability is an index calculated by several factors that affect a governments ability to effectively formulate and implement sound policies[vi] Figure 1 outlines the positive correlation between stability and HDI, as well as the inverse; lower levels of political stability correlates positively with a lower HDI.[vii] In other words, countries that face instability in their governments are more likely to suffer on a larger scale. Figure 1 supports the theory that a given event in the Middle East that may disrupt governments will likely reverberate on large scale crises across the region.
Figure 1: Political Stability and Human Development Index for all countries
GDP per Capita vs Likelihood of Conflict
If a conflict capable of causing political disruption has the ability to affect an entire nation, then the next step in understanding the impact of lower oil value comes from examining the correlation between the Gross Domestic Product (GDP) and the probability that has on a nations likelihood to experience political conflict. Figure 2 displays the negative correlation between a high GDP and the likelihood of conflict.[viii] The lower a nations GDP, the more likely it is to observe a new conflict. A major problem with the rentier system prevalent in the Middle East is the lack of economic diversity; developed nations trend toward having diversified economies.[ix] Diversity in an economy allows for a failsafe in the event certain industries suffer. The problem with basing an economy around the exportation of a single natural resource is that if the single resource loses value, the entire GDP is at risk of plummeting.[x] For this reason, falling oil values will lead to lower GDPs throughout the Middle East, leading to a higher likelihood of conflict.
Figure 2: GDP per Capita and the probability of observing a new conflict
Past vs Future Crude Oil Values
Crude oil value is expected to decline steadily over the next several decades. The two main factors are an increase in supply due to future efficiency in extraction methods, as well as the increase in reliance on alternative energy.[xi] The United States success in hydrolic fracturing extraction, otherwise known as fracking has led the U.S. Department of Energy to claim that by 2035 45% of the United States gas consumption will be via fracked oil.[xii] Likewise, the McCinsy Institute, experts in global economic projections, argue that by 2035 alternative clean energy sources (not including fracking) will make up nearly half of all energy demand worldwide.[xiii] Figure 3 displays the anticipated decrease in demand for liquid energy (crude oil) through 2035.[xiv] Consequently, a significant increase in oil supply combined with a decrease in oil demand will likely lead to a slow and steady decline in oil value through at least 2050.[xv]
Figure 3: Global Liquids supply and demand under Accelerated Energy Transition case
United Arab Emirates
The United Arab Emirates provides a good blueprint for Gulf nations moving forward. Despite initially constructing their economy around their sale of crude oil, the UAE has since recognized this weakness, and is currently making attempts at wider economic diversification. The United Arab Emirates have long avoided political instability by ensuring its citizens have their needs met via a robust welfare system. [xvi]Over 90% of employed Emiratis work for the government, and subsidies for peoples normal expensive affairs, such as marriage, are often paid for by the government.[xvii] However, this system is only possible through the massive profits generated by the UAEs exportation of crude oil. In addition, the UAEs homogeny in its economy means even a relatively slight dip in oil prices could threaten their entire country with recession. To the UAEs credit, they have made significant efforts in the past decade to diversify their economy in an attempt to lessen the devastation caused by falling oil value. The now famous tourist landmarks that dot the landscape of Abu Dhabi are a clear example of their attempts to lean into other industries.[xviii] While hedging its bets on tourism certainly isnt the perfect solution, the UAE has at least identified the need to branch out into other industries. Major oil exporting countries in the Middle East would be wise to follow the UAEs lead in economic diversification if they wish to increase their chances of stability in the future.
Egypt faces a more difficult future with no clear economic reform plan. While oil exporting gulf states must prepare for an incoming economic recession, non-exporting countries should fear for their stability as well. Nations on friendly terms with OPEC often receive large grants and subsidies in order to keep their own economies afloat during turbulent times.[xix] During the turn of the century, on average, 10% of Egypts GDP came from Gulf state grants and remittances. Following extreme political instability from 2011-2015, OPEC nations sent billions in aid to Egypt for the explicit purpose of ensuring the stability of the government.[xx] While Egypt doesnt have the economic power to mimic the UAEs welfare system, it does still depend largely on subsidies to its citizens to guarantee compliance. However, the risk of reduction of these subsidizes has plagued stability in Egypt for the past decade. In April of 2019 the government announced a new cut to fuel subsidies, citing poor economic development as the culprit.[xxi] Experts fear this recent cut will only contribute to the unstable situation Egypt has found itself since the Arab Spring began.[xxii] Gulf countries facing major economic recession will likely slash foreign aid to non-exporting countries such as Egypt, which in turn, could affect the stability of the entire Middle East.
Several sectors of Middle Eastern society require reform in avoid long term consequences. While extreme economic reform is necessary, success in the future will ultimately hinge on each countrys ability to adapt politically as well. Preventing collapse after oil falls cannot be singularly accomplished through investment diversity. A fall in oil will affect not just the economy, but the overall social contract governments have held with their people for nearly a century. Certain steps, such as privatization, attracting foreign investment, and integrating into the global economy can only be achieved if political transparency rises and political corruption falls.[xxiii] Breaking of social contracts has already caused major problems in the region. Tunisia, Egypt, Syria, and Yemen have all seen revolutions and civil wars this past decade, in large part due to its citizenry losing trust in their government. According to the Corruption Percentage Index (PCI) developed by Transparency International, Middle Eastern governments ranked among the worlds lowest in terms of transparency for the past decade.[xxiv]
The recent 2019 attacks on Abqaiq and Khurais oil facilities in Saudi Arabia point to major weaknesses in the security of Saudi Arabias oil infrastructure. The attacks reduced the countrys oil output by nearly half that day, dropping the entire worlds supply by 5%.[xxv] The Houthi-led attack displayed a new dynamic in which to fight in the Middle East; by attacking economic infrastructure. Historically, guerilla attacks in the Middle East tended to target political, military, or social targets. This recent attack is significant to future developments because it displays not only the effectiveness of attacking economic infrastructure, but also the security weaknesses of these targets. Rentier states now need to diversify not only due to future dropping oil prices, but also for short term economic reasons as well. If attacking oil refineries continues to be effective, more attacks should be expected in the future. Likewise, if attacks continue, oil markets can become extremely volatile until security issues are resolved. Regardless of whether it jumps or dips, an overall volatile market is a death sentence for rentier states; lack of economic diversification combined with an unpredictable market will drive away foreign investment. Foreign investment is key to allowing rentier states to diversify. Until Saudi Arabia (and all OPEC states) can strengthen security of their facilities to the point where attacks are no longer effective, their ability to attract foreign investment and by extension, pull themselves out of their rentier economic cycle, will continue to decline.
Long term foreign investment is dependent on a given nations ability to persuade shareholders that political turbulence is unlikely to occur. Likewise, successful privatization of industries is dependent on international corporations having high trust and confidence in the reigning government to not drastically change the dynamic of their country.[xxvi] A significant reduction in political corruption, and an increase in political transparency is necessary in countries that wish to join the international economy on a level outside of oil exportation.
Ever since the discovery of oil in the Middle East in the mid-20th century, the region has relied heavily on rentier government systems to secure their stability.[xxvii] However, this system has always precariously depended on the value of a single natural resource in order to prevent total collapse. While rentier systems are prone to economic swings, unemployment is another major concern. Oil extraction and exportation requires such little personnel employment that a massive percentage of Gulf nations need to provide for their citizens via an extensive welfare system. These welfare systems in turn are only made possible through the profits generated from oil. A long-term shortage of profits means governments will no longer be able to placate their citizens with money, and unemployment will start to emerge as a major concern. Given this foundation, falling oil value could threaten to unravel the social contract between Middle Eastern citizenry and their governments. Doing so will likely lead to a major increase in political stability, which in turn could lead to major crises throughout the region. If Middle Eastern countries wish to see a way out of this trajectory, they should look to the example set by the UAE for economic diversification by investing in new industries. However, major economic reforms are only possible if governments reform politically in conjunction. Corruption and political turmoil turn away foreign investors, and thus, any chance at joining the global economy.[xxviii] The Middle East can wade through this incoming crisis, but major economic and political reforms are necessary first. Failure to do so could create extreme large-scale problems in the Middle East, perpetuating the cycle of poor development in the region.
The recent 2019 attacks on Saudi Arabias oil facilities required an update to this essay, given their relevance to the subject and the impacts they will have on the region. As of September 17, 2019, the date of this essay, there are still details emerging regarding the attacks. As of this writing, the Houthi rebels have claimed responsibility for the attacks, however, no evidence yet exists to the public that can definitively point to the source. The United States claimed Iran is responsible, France claims they have seen no evidence of responsibility from anyone yet, Iran denies involvement, and the Houthi rebels have claimed responsibility.[xxix] There is some evidence to suggest the point of origin of the strike may be near Iraq or Iran, but no definitive perpetrator can be proven as of this writing.[xxx] Regardless, theorizing who is responsible has no effect on the significance it holds to this essay. While details are still emerging, the fact remains that the recent attacks certainly display a weakness in OPEC security, and display a new dynamic by which to attack these states. For this reason, it was relevant to include under the Impacts section of this essay.
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