Not unpredictably, there is a complex energy bind as we approach the end of the twentieth century. The oil importing industrial countries have anchored their industries, their means of transportation, their home comfort—in short, their whole energy-dependent lifestyle—largely to hydrocarbon fuels. For most of these countries, as well as the majority of the oil importing developing countries, domestic oil (and gas) needs must be supplied partly or largely from abroad. The major international hydrocarbon suppliers, in turn, are limited to a relatively small group of oil exporting developing countries, most of whom are members of the Organization of Petroleum Exporting Countries (OPEC).
For the first time in postwar history, if not indeed the history of the modern world, energy management has become an overriding global economic, strategic, and political issue. Worldwide inflation, continued slow growth of industrial economies, high and widespread unemployment, and the discouraging prospects for the poorer non-oil developing countries are often linked to the so-called energy crisis. The emergence of this phenomenon is of crucial significance not only in the internal development strategies of the major oil exporting and large oil importing countries but also in the ongoing North/South relations, the old East/West competition, and the new North/North and South/South cooperation.
Critical choices of development strategy facing the oil exporting developing countries revolve around the prospects for and limitations of their underlying economic structure as major oil exporters. On the positive side, these countries possess some fortuitous features not shared by other developing countries. Among these is a steady and effective demand for oil paid in foreign exchange, creating a sizable and virtually painless source of national savings that is capable of underwriting domestic development as well as foreign investment and assistance. On the negative side, these countries are plagued by certain growth-impeding factors such as insufficient infrastructure facilities, insufficient skilled labor, the lack of a commensurately developed bureaucracy, and a virtual absence of capital-based indigenous technology.
The economic policy choices available to oil exporting developing countries in deciding how best to implement their national priorities cover a wide range. They include both conventional policies (i.e., foreign exchange, public revenues and expenditures, and money and credit), and industry-specific measures. Each category, in turn, offers special features that correspond to the particular characteristics of the oil exporting countries.
Not unpredictably, there is a complex energy bind as we approach the end of the twentieth century. The oil importing industrial countries have anchored their industries, their means of transportation, their home comfort- in short, their whole energy-dependent lifestyle-largely to hydrocarbon fuels.
This volume is the Seventh Issue of Selected Decisions of the IMF and Selected Documents. It contains the decisions, interpretations, and resolutions of the Executive Directors and the Board of Governors of the IMF to which frequent reference is made in the current activities of the Fund. In addition, the volume contains certain documents relating to the IMF and the United Nations. This issue contains most of the decisions that were published in earlier issues but not decisions that have ceased to be effective or that are referred to less frequently than in the past. A substantial part of this volume is devoted to decisions taken by the IMF since the last issue. With few exceptions, the decisions in this volume are general in application and relate to obligations, policies, or procedures under the Articles of Agreement. Subject to the few exceptions referred to, decisions that affect individual members are not included. Decisions of the Fund that are included in the By-Laws and the Rules and Regulations are general in application but are not reproduced in this volume.
Chapter III discussed the policy options and directions of the domestic investment strategy of the oil exporting developing countries and their individual country performances. The discussion showed that the issue of the medium-term management of oil revenues is closely related to the long-term considerations of how the oil reserves are managed. These two issues, in turn, are intertwined with the way the countries handle their financial relationships with the rest of the world. The main concern of this chapter is with the management of external payments imbalances that result from the decisions on oil production and pricing by the oil exporting developing countries, their internal economic development, and their trade and aid relations with the rest of the world.
The energy crisis of the 1970s is the energy challenge of the 1980s and beyond. Economically competitive substitutes for oil will have to be found; energy (and particularly oil) efficiency in the production sector will have to be increased; and a reasonable rate of growth of gross world product through interparty cooperation will have to be maintained. The crisis will persist as long as ready and cheap alternatives to oil are not found, conservation measures are not continued and expanded, and world economic growth (and particularly the growth of output in the developing countries) should remain so slow that it creates or perpetuates global political tensions, unused productive capacity, and international economic inequities.150