Search

Abstract: This paper aims to assess the efforts of the Saudi government in diversifying its economy. A descriptive analysis was used to evaluate the efforts the Saudi government exerted to enhance economic diversification through nine development plans covering 45 years (from 1970 to 2014). Two measures of economic diversification were applied, instability of private gross domestic product (GDP) and its relation to oil price instability, and relative contribution of private and public sectors to GDP. The research concludes that Saudi government has succeeded in moving towards economic diversification in the last two development plans compared to the previous seven development plans, although the economic diversification was a slow‐paced process. The performance of the private sector is still low which calls for a prompt intervention from the Saudi government to improve the legislative environment, competition, and attracting big international companies to enter Saudi market and raise the level of efficiency of the private sector and achieve its main goal of being less dependent on oil sector and its revenue. [ABSTRACT FROM AUTHOR]

The current paper seeks to examine the relationship between energy consumption and real output in the United Arab Emirates (UAE) economy. Technically, we assess the following two questions: 'does the increase in energy consumption cause more economic growth in the UAE economy?' or 'does the rapid economic growth lead to more energy consumption?' We utilise the bounds testing approach to cointegration and error correction model and Granger causality test to achieve the paper goal. The paper employs an annual data series of the UAE real gross domestic product and energy consumption over the 1973-2008 period. The findings of the paper have two levels: short-run and long-run. In the short-run, the results reveal a clear statistically significant bidirectional positive relationship between energy consumption and real output in the UAE economy. However, in the long-run the estimate illustrates only one relationship prevails from the short-run. This one is the statistically significant positive unidirectional relationship running from real output to energy consumption. [ABSTRACT FROM AUTHOR]

Abstract: This study examines the dynamic relationship between oil revenue, government spending and economic growth in Nigeria. Since the discovery of oil, oil proceeds have dominated the country's federation account and have improved public spending. In this paper, we analyse if the huge government spending has improved the rate of economic growth. To do this, the multivariate vector autoregression framework with special attention to Generalised Impulse Response Function is adopted in analysing the annual data of oil revenue, total government expenditure and real Gross Domestic Product from 1980 to 2015. We find evidence that oil receipts remain the major route which public spending is financed and the fundamental source for growth. Hence, there is need for the government to diversify the sources of foreign exchange inflow of the country. The diversification of the economy is required to insulate it from external shocks. It is recommended for Nigeria to explore ways of reviving its huge agricultural potential which has been neglected since the discovery of oil in addition to exploring its rich untapped solid minerals deposit in order to promote diversification of the economy away from a mono cultural product base. [ABSTRACT FROM AUTHOR]

In this paper, we study the non-linear relationship between oil revenues and real output growth of the Iranian economy during 1959–2007 using a threshold error correction model. The estimation results show that the response of economic growth to oil revenue growth in low regimes of oil revenues is greater than in high regimes of oil revenues. The threshold of oil revenues in Iran is about 37 per cent, in a way that increasing the oil revenues over this threshold results in aborting its positive impact on the gross domestic product and its significant effect. In addition, the impact of capital stock on economic growth in low oil revenues is also much more than that in high oil revenues. These results confirm the resource curse, higher rent-seeking activities and lower productivity hypothesis, especially during boom periods for oil revenues. [ABSTRACT FROM AUTHOR]

This paper examines the relationship between energy consumption and real gross domestic product ( GDP) per capita for the 15 former Soviet Union countries during the period 1992-2009. These countries have been rarely investigated with regard to the related nexus in the literature despite the important role of these countries in energy markets as producers and consumers. Panel unit root tests, panel cointegration tests and panel vector error correction model in a dynamic panel framework are employed to infer the causal relationship. The empirical results show that there is a unidirectional causal relationship running from energy consumption to the real GDP per capita in the long run but not in the short-run for the former Soviet Union countries and Commonwealth Independent States countries regardless Russia is included or excluded. However, we discover a bidirectional relationship for oil importer and natural gas importer countries. Therefore, the findings of this study support the growth hypothesis for the former subsegments and feedback hypothesis for the latter subsegments. [ABSTRACT FROM AUTHOR]

Crude oil plays an important role in the economic development of many emerging markets. This study examines the role of global crude oil price on the exchange rate (EXR) and gross domestic product (GDP) of Ghana (a new oil producing country) using the Johansen modelling technique for the period, 1980-2013. Following the cointegration of the variables, the vector error correction model was developed, which revealed that oil price could increase the GDP growth by 3 per cent but can negatively affect the EXR in the long run. The short-term analysis points to Granger causality from oil price and GDP to energy consumption. It further reveals causality from oil price and EXR to GDP, which indicates that development in the global oil price as well as the performance of the currency can impact economic growth. No significant evidence of the oil price role in EXR volatility was found; however, the 'Dutch disease' syndrome was eminent through EXR appreciation. Moreover, the overall response of GDP to oil price shocks for the forecast period is insignificantly positive even though oil price shock tends to retard economic growth in the first 3 years. [ABSTRACT FROM AUTHOR]

Electricity consumption in Sub- Saharan Africa has surged over the past two decades, whereas economic fundamentals like growth in gross domestic product ( GDP) might have contributed to this trend, the impact of changing climatic conditions cannot be underestimated. This study therefore investigates the dynamics among electricity consumption, temperature variability (a proxy for climate change) and economic growth, while controlling for urbanization within a structural vector error correction model for 11 countries in Sub- Saharan Africa. Findings from the study indicate that a positive shock in temperature variability has a positive permanent effect on electricity consumption for all the countries except Togo, South Africa and Zimbabwe. In the case of Togo we find only transitory effects of positive shocks in temperature variability on electricity consumption. However, these effects are minimal, given the low penetration rate for air conditioners and heating devices in these countries. Moreover the findings further indicate that the effects of a positive shock in temperature variability on real GDP is consistent in terms of the direction of the effects, which is negative, but only vary across the sampled countries in relation to the period(s) the effects of the shocks completely diminished. [ABSTRACT FROM AUTHOR]

The passage into law of the Nigerian local content bill is one of the significant developments for domesticating the oil and gas industry through local value additions to the local economy. The bill received presidential assent on 22 April 2010 and created a law to provide for the development of indigenous content in the Nigerian oil and gas industry. The law also establishes the Nigerian Content Monitoring Board (board), which is charged with the responsibility to manage the coordination, monitoring and implementation of the local content law. Previous acts of the government had made feeble attempts at developing a local content framework for the industry and the fanfare associated with the recent enactment into law of the Nigerian local content bill very understandable. Nigeria is the world's eighth biggest oil exporter and relies on crude as its main foreign exchange earner. The industry accounts for over 40 per cent of Nigeria's gross domestic product and is associated with over a billion dollars worth of investments annually. There is a marked absence of indigenous players involved in these transactions, where about 90 per cent of goods and services used in the industry are imported from overseas. The local content law seeks to increase indigenous participation by prescribing minimum thresholds for the use of local services and to promote the employment of Nigerian staff in the industry. In this article, the writer makes a succinct analysis of the provisions of the Nigerian Local Content Act and argues that an antidote has been found for local participation in the vibrant Nigerian oil and gas sector. The writer concludes that, similar to Saudi Arabia, Venezuela and Kuwait, the local content law will go a long way in empowering indigenous oil and gas companies and assist Nigeria in developing the technical capacity for the industry. [ABSTRACT FROM AUTHOR]