A warm welcome to Gabon: expanding our stability

OPEC Bulletin Commentary June-July 2016

One of the advantages of international intergovernmental organizations like OPEC is the diversity of their members and staff. As part of their mission, such multilateral entities represent — and advocate for — the interests of their members. OPEC has enshrined such objectives in the OPEC Statute.

But international organizations also have to operate at the formal, diplomatic and stately level of the international community. In short, they not only have to represent a broad range of views and opinions — those of its members — but also have to act as one, with the unity required to be an effective voice for the common interests of their members. This goal is strengthened any time additional member countries join.

The decision then of Gabon to rejoin OPEC, effective July 1, promises to expand and strengthen the Organization in both these regards. On the one hand, the sub-Saharan African country represents a rich amalgamation of native (primarily but not only Bantu) and French culture. It has a history that goes back centuries. And today Gabon affirms its own proud identity, celebrating the triumph of independence over colonialism. At the same time, the country is an important economic and commercial leader in the region, with significant timber, mining, and energy activities. According to data from official sources, Gabon has the third highest GDP per capita (at PPP) in sub-Saharan Africa and counts with the fourth-highest Human Development Index too.

Thus, on various fronts, Gabon brings to OPEC fresh, new country insights into regional developments (whether social, economic, or political). It also serves as an example as to what may be achieved through careful planning and sound management of petroleum resources.

In fact, the history of Gabon’s oil and gas industry is a venerable one, dating back to early prospecting efforts of 1931. With investments, technical know-how and ingenuity and determination, the country was able to tap into and benefit from the massive petroleum deposits along the coast, as well as offshore. In time, these activities helped the country develop a healthy treasury, and the country found formidable new opportunities as a major oil producer and trading partner.

It is important too to note that the country — which gained independence from France in 1960 — has long been known for its stability. This is noteworthy in a region too often marked by unrest. That stability is, of course, a necessary requirement for development of any economic venture, particularly in the oil industry. Stability determines the extent — and the degree — of the investments being channelled into the oil and gas sectors. Stability provides the incentive for investors to channel resources into energy projects. And stability is precisely what OPEC strives to ensure across the oil markets.

Over the years, Gabon has welcomed business interest from countries around the world, including Asia, Europe, and the Americas. Its stability, in combination with other incentives like special economic zones and a comparatively high purchasing power, has convinced many corporations to consider expanding their portfolios to include Gabonese assets. The likelihood of future crude oil discoveries has certainly offered foreign investors the promise of tremendous opportunities in the country. But more importantly, investors know that they have also been contributing to the development of the Gabonese economy — and to an expansion of opportunities for the country’s people. Whatever the case may be, the benefits to both international oil companies and to the country and its people, have been significant.

Gabon, which rejoins the Organization after over two decades away (it joined in 1975 and left in 1995), has many things to contribute to the Organization. It brings additional and important perspectives, based on decades of experience working with the industry worldwide, which it can bring to bear, as it joins other colleagues in the Organization in doing the important work of research and analysis. In truth, it is only through additional perspectives from different vantage points that we can better understand the complexity of today’s oil markets, particularly amid the constantly changing and consistently unpredictable nature of the global economic and financial context.

As a Member of OPEC, Gabon and its delegation will now have a home away from home in Vienna at the Secretariat — a place where experts and analysts from the industry in other Member Countries may exchange views, serve as a sounding board and perhaps find support for their work through the in-house research facilities. This is, after all, the mission of the Organization — so it is only natural that a country as richly endowed with hydrocarbon resources and as experienced as Gabon will join many of the world’s other major oil producers at the Secretariat.

And through the Ministerial Conference, the Gabonese delegation — Gabon’s Minister, Governor, and National Representative — will join a group of colleagues with whom they can learn from each other and seek a better understanding of their shared work as oil producers. As other Member Countries inevitably have found, there is a strength that comes through unity — and OPEC offers precisely the means with which to leverage this unity for the betterment of the industry and for the defense of the interests of its Members.

This is what it means to join the family known as OPEC — and we warmly welcome our Gabonese colleagues back to the fold.

OPEC Bulletin June-July 2016

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