The Poverty of Energy Security

When the G-8 met in Gleneagles last year, global poverty and climate change headlined the agenda. This weekend in St. Petersburg, energy security tops the list, and last year’s priorities seem forgotten. The G-8 appears to define energy security primarily as promoting the expansion of oil production worldwide, which will only further increase oil dependence, exacerbate climate change and drive countries deeper into debt.

Impoverished countries are not only drowning in debt, but they are drowning in oil and could soon be literally drowning in rising seas. Those that import oil are beholden to skyrocketing prices. These increased prices threaten to erase the limited gains made last year at the Gleneagles summit. Moreover, poor countries are hit hardest by the growing catastrophe of climate change, driven by our addiction to oil and other fossil fuels. These connections between poverty and energy have become increasingly clear to our organizations and must be recognized by the G-8.
For those countries that import oil from abroad, higher oil prices are literally lethal. According to figures compiled by the Center for American Progress, the cost of Tanzania’s oil imports rose from roughly $190 million in 2002 to about $480 million in 2006, representing an additional $290 million in payments each year for approximately the same amount of oil. Conversely, debt cancellation is expected to free up roughly $140 million in Tanzania in 2006, less than half of the additional amount that the country is paying for oil imports each year.

Similar trends on the impact of rising oil prices can be detected in a variety of countries around the world. Research conducted by the Mali Folkecenter estimates that Mali has gone from spending $100 million per year on oil imports in 1998 to almost $400 million in 2005. This increase dwarfs the $28 million in debt relief it will see in 2006 from last year’s G-8 commitment on debt cancellation. This money was supposed to be used for healthcare and clean water, not oil. How will these countries pay for their increasing oil bills? Deeper into debt they go.

AllAfrica