Lambertmbela's Blog

Just another WordPress.com weblog

BP’s Gulf of Mexico Oil Spill: The Warning Signal?

The Gulf of Mexico oil spill has been raising lot of questions with regards to offshore drilling. Much has already been said and unquestionably, many still have to be said. However, I would like to focus on one point: the lesson that developing countries should be learning from this, and the dilemma that they will probably soon be facing between, on one hand, the need for foreign direct investments and on the other hand the concern for their ecosystems; given that oil companies do not feel the same pressure when such accidents occur in third world countries and worldwide media do not really pay attention.

A Nigerian writer, Ben Ikari, recently said, while talking about the Gulf of Mexico oil spill, that “If this Gulf accident had happened in Nigeria, neither the government nor the company would have paid much attention … this kind of spill happens all the time in the delta.”

To back up Ben Ikari’s words, let me start by mentioning some oil spill accidents that happened quite recently in some third world countries. The most recent examples are the spill that happened in Singapore, Singapore Strait on the 25th May 2010 (oil company: MT BUNGA KELENA 3), or the one in Nigeria, Niger Delta on the 1st May 2010 (oil company: EXXONMOBIL). These oil spills did not cause any worldwide headlines whereas in these countries, people depend completely on the environment for their basic life needs such as drinking water, food, source of income and other basic daily life needs. So for these people, seeing Obama, the US president making daily speeches about the BP oil disaster; watching worldwide media such as BBC, CNN, Euronews, France24 talking about this minute after minute in their headlines; seeing BP oil using all their new technology and even deciding to stop paying dividends in order to ensure compensation for damage caused; is more than a surreal thing.

Referring to oil spills in developing countries, Ben Ikari carried on by saying that “The oil companies just ignore it. The lawmakers do not care and people must live with pollution daily. ..When I see the efforts that are being made in the US I feel a great sense of sadness at the double standards. What they do in the US or in Europe is very different.”

Well…

Coming back to my main point, namely the dilemma between on one hand the need for Foreign Direct Investments in developing countries and on the other hand the concern for their ecosystems: Undoubtedly, with this gulf of Mexico oil spill, big crude oil companies in the world will probably be forced to intensify offshore interests in developing countries such as the Gulf of Guinea, the Gulf of Aden -Yemen, the Niger Delta or the Angola’s offshore oil, where an incident like the Gulf of Mexico one will not probably retain world attention, obliging these companies to stop paying dividends. Indeed, with more potential offshore drilling restrictions / regulations coming in the USA, oil companies would have to explore new territories and this would indisputably lead them to countries with less regulation … Guess where I’m looking…

So, FDI at all costs?

Should oil companies abuse poverty in third world countries and put their governments in a situation where they would have to choose between FDI Vs damaging the ecosystem, FDI Vs sacrificing future generations or FDI Vs risking daily life?

Will developing country governments be able to strike a balance between attracting foreign investments and strict regulations that would protect not only their own peoples and ecosystems, but also be a guarantee for a sustainable development?

The debate is open, watch out!

June 20, 2010 Posted by | Articles In English, International Business, International Economics | , , , , , , , , , , | 3 Comments