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CHANGE; BUT FOR BETTER? What Egypt’s Shift in Energy Policy Means for the Future
A famous Japanese proverb states, “The bamboo that bends is stronger than the oak that resists.” If there is any entity that has taken this advice to heart, surely it is the Egyptian energy sector.
$400 billion Loss for American Shale Due to Oil Price Deterioration
It’s a chess game in every sense for the Organization of Petroleum Exporting Countries (OPEC) and American companies producing shale oil – where a nascent revolution faces its first real test since it emerged five years ago.
Government Efforts to Stem the Decline in Oil and Gas Production
In an attempt to overcome severe energy shortage and to stem the decline in oil and gas production, the government has recently awarded twelve new exploration blocks to international oil companies (IOCs)
An Argument for Direct Marketing: Need More Power? Free up the Gas
Power cuts and blackouts lasting between four and five hours are becoming a daily norm in Egypt, and the deficit between consumption and generation is widening year after year. It is not an installed generation capacity problem: on paper, Egypt has a 33,000 MW installed power generation capacity. As of 2014, all the fuel-to-power available is enough to generate only 22,000 MW compared to summer peak loads of 26,000-27,000 MW. So the installed capacity, even at 80% efficiency is enough to meet the summer peak loads.
Sparking Reform: Creating Dynamism in the Egyptian Energy Sector
Egypt has been at the center of the news for the past several years. Its constant political and economic turmoil have kept the country on a razor’s edge. Since, the 2011 revolution, Egypt’s economy has sputtered. And, it has been extremely difficult for the country to retain and attract foreign revenue, as well as crucial tourism inflows. All of the preceding had a knock-on effect for the country’s energy sector, and its underlying strength and vitality have been severely questioned. Consequently, investors have turned away from the Egyptian market
Egypt Can Move Forward with Energy
With the establishment of the new El-Sisi government there is some hope for a more secure and more stable Egypt, but this is not guaranteed. The good general likely knows very well of the threats to energy, water, food and economic infrastructure that may lurk in Egypt.
Whither Egypt’s Economy?
The new Egyptian leadership is facing formidable economic challenges. The official unemployment rate is above 13%, higher than last year. Compared to 2010, the number of unemployed Egyptians has grown from 2.4 million to 3.7 million. Large numbers are out of the workforce, or struggle in low-paid occupations in the informal sector. 26% of the population is living under the official poverty line, set at around $1.50 a day.
The Road to Energy Self-Sufficiency
Energy is a vital line for any economy and an important factor in the lives of all Egyptians. Access to energy at affordable prices encourages growth in all economic sectors. Energy markets across the world are faced with a variety of similar challenges and each market can boost economic growth through the development of strategies to secure affordable, sustainable, and safe energy supplies.
Subsidies, Rationality, and Revolution: An Alternative Perspective
Economists and businessmen are generally expected to exhibit a blind faith in the virtues of individual self-interest and the absence of government intervention. However, such faith also often blinds policy makers and other free market advocates to the reality that there often exist very reasoned, politically necessary, and more foresighted economic justifications for petroleum subsidization or at least an exceptionally long period of time over which these subsidies might be reduced. Egypt's economic and political history since 2005, and the experience of the global food crisis in 2007/2008, efficiently serve as the background for such an argument and yield a policy prescription that focuses rightly upon proper timing as an element of any future action in the sphere of subsidies.