First, since large companies are better than governments at both absorbing large windfalls as well as withstanding sudden shortages of cash, he suggests altering the distribution of risk in the standard oil contract, wherein the oil company is guaranteed a certain stream of income, but the government reaps the reward if oil prices rise.
Second, he says that developing countries, often woefully deficient in the basic staples of a middle-income nation (roads, hospitals, et cetera), should sell their oil not for dollars but for infrastructure. Ross:
The governments of Angola and Nigeria are now experimenting with this type of barter: they have awarded oil contracts to Chinese companies in exchange for the construction of infrastructure. Western oil companies have been reluctant to make similar deals, pointing out that they know little about railroads and have trouble competing against state-owned enterprises in this arena, such as the Chinese oil companies. But they could easily team up with reputable companies that could carry out the work. And why stop at infrastructure? By forming partnerships, with experienced providers, oil companies could pay back host countries by, say, conducting antimalaria campaigns or building schools, irrigation projects, or microfinancing facilities.
Both of Ross's suggestions would have the added benefit of reducing the opportunities for corruption. With fewer dollars in play, it'd be harder for a dirty official to siphon a stack of Benjamins off into his own pocket. And it's not like he could jack a stretch of highway or a hospital wing. Of course, with Pemex's domination of Mexico's oil being absolute, such ideas are no more than daydream fodder here.
No comments:
Post a Comment