Voices from the Arab Press: Will the electric car destroy our economy?

I always thought that what would threaten our economy would be depletion of oil, and that Kuwait had to prepare for a period in which oil would run out. However, times have changed. Now, the most likely scenario is that Kuwait will be forced to slow down its oil production not because of limited availability, but because of declining prices. I’m not talking about seasonal drops in price. Rather, I’m referring to a permanent decline in the price of oil resulting from a massive shift to renewable energy such as wind and solar power. 

Even though electric vehicles still constitute less than 3% of total sold cars around the world, there are clear indicators that this percentage will rise sharply in years to come. The petrol-powered car is likely to disappear from the world and be replaced with the electric-powered one. Mary Barra, the president of General Motors (GM), announced last week that the company will stop producing fuel cars by 2035, sending shockwaves through the auto market. 

GM, employing over a million workers, is the largest auto manufacturer in the United States. Almost 20 years ago it began building its first electric car (under the brand name EVI), but it quickly abandoned that project. Now, at a time when car manufacturers are coming under heavy scrutiny and public pressure, the company decided to restore its pledge to go electric. GM isn’t alone. Volkswagen has recently announced that, by 2030, it will create an electric version of every gasoline car type it currently manufactures. 

Oil companies are carefully monitoring these developments and are taking new paths. In August 2020, BP announced that it would reduce its oil and gas production by about 35% within ten years, shifting investments into renewable energy. And we, in Kuwait and the Gulf states, must also be on the lookout. We must start planning for the day after oil. We got a glimpse of what this world might look like during the first weeks of the coronavirus pandemic, when people sheltered at home and there were no cars on the streets. While electric vehicles are environmentally friendly, they are far from a friendly development for us — at least at first glance. But we have to think clearly and learn to befriend it. We must adapt to these changing norms and their impact on our economy. 

Most importantly, we must prepare for a life of minimal global demand for oil. Otherwise, we will be taken by surprise and find ourselves unable to cope with this new global reality.

– Hamed Al-Hamoud 

In his speech to the Davos Forum, which was held virtually this year, Russian President Vladimir Putin warned the audience against a “fight of all against all.” His warning was based on the fact that the structure of the international system today is unstable, in a way that is very much similar to what it was between the two world wars. 

Putin spoke about the prevailing pattern of capitalism and the exacerbation of social inequality. He remarked that it is no longer possible to meet the current challenges we face with traditional policies, such as extending loans to individuals and companies in order to boost productivity and stimulate consumption in the economy. Putin advocated creation of a new international system with specialized institutions to fulfill the four requirements necessary to prevent the collapse of the global economy: creating new job opportunities, providing the necessary housing for displaced and marginalized groups, developing preventive and therapeutic medicine, and providing quality education for children and youth. 

Putin’s sharp tone reflected the atmosphere of political dialogue among the leaders of the developed world on the crisis currently faced by the international system in its strategic and economic dimensions. It is no coincidence that the executive chairman of the World Economic Forum, the renowned German economist Klaus Schwab, chose the saying “great reset” as a slogan for the new session. 

The focus of all talks was the global strategy for dealing with the coronavirus pandemic. French President Emmanuel Macron criticized the neoliberal policies that have dominated the Western world in the past three decades, calling for the overhaul of the Washington Consensus that led to the emergence of the post-World War II financial system. Instead, he proposed the “Paris Consensus,” which would be based on “responsible social capitalism,” the defense of vital human needs, the fight against inequality and the advancement of safe environmental policies. 

Although international financial institutions have adopted the concept of “human development,” they have not fully internalized it into their frameworks and thinking. COVID-19 has shown us that major countries around the world quickly found themselves in a state of complete instability and were unable to follow the so-called rules of international partnership and collaboration. As every country around the world locked up its border, concepts like economic integration, mutual assistance and social assurances disappeared. Hence, it is not feasible to return to the traditional economic logic that governed our international system before the pandemic.

The global system is more interconnected than we would like to admit. A virus in one part of the world can shut down the entire Western economy overnight – and the way the virus has impacted different nations around the world has been far from uniform, with some countries getting access to vaccinations and groundbreaking technologies quicker than others, without caring for the poor nations left behind to deal with their miserable fate on their own.

– Seyid Ould Bah 

Climate change was a top agenda item for US President Joe Biden on the campaign trail — and it’s quickly becoming a dominant feature of his administration now that he’s in the White House. 

The decision to return to the Paris Climate Agreement, from which Trump withdrew, was one of Biden’s first executive orders issued upon his inauguration as president. But he didn’t stop there. He made several important decisions regarding climate change to signal his seriousness about the issue, the most notable of which was the appointment of former secretary of state John Kerry as the US special envoy on climate change, and the convening of a special task force of legal experts to review and implement the president’s ambitious environmental vision. 

As a part of this vision, Biden wants the US to invest in green technologies, ensure a full national transition to clean energy by 2035, and commit to zero greenhouse gas emissions by 2050. Finally, Biden issued an executive order suspending oil and gas exploration in America, which sparked widespread debate in Washington due to its adverse effect on the American shale oil sector. Some pundits believe that Biden is striving to become the global leader on the issue of climate change. This is not out of the question. Certainly, this would be consistent with the agenda of the Democratic Party, which has spoken out against large oil companies and oil tycoons. 

But Biden isn’t guided by ethics and morals alone. For example, the president’s decision to freeze and suspend all oil and gas exploration in America, which will lead to losses estimated in the billions of dollars and thousands of jobs, must be grounded in considerations that go far beyond morals. There are key political and economic interests at play as well. Aware that the next generation of economic investments will be in renewable energies, Biden is working to protect his nation’s financial well-being. 

This is evident from the ambitious environmental agenda aimed at intensifying investment in alternative energy. Further, the issue of climate change has become a battleground between the US and China. By positioning himself as a global leader on climate change, Biden is putting up a fight against his fierce competition in Beijing. Climate change will remain a guiding factor in much of Biden’s domestic and foreign politics. Those who want to predict the president’s future policies and actions would benefit from examining them through the lens of the environment — specifically through America’s moral, economic and political motives in becoming a leader in battling climate change.