Tuesday , October 17 2017

Players to panic, anxiety – Situation good despite oil dip

Yusuf Awadh Al-Azmi
Yusuf Awadh Al-Azmi
In one of my articles published about a year ago, I had recommended that Kuwait should suspend oil exportation for one year in order to enable the country to restructure, renovate and maintain its oil facilities.

I suggested this idea because the oil price was no longer tempting, considering it was about $50 per barrel at that time. I thought the best thing to do was to seize the opportunity to suspend production, renovate the oil facilities and rebuild them until the oil price becomes reasonable and acceptable again.

 In that article, I had hinted that the downfall in oil prices was deliberate in order for some OPEC member states to implement a particular policy due to the international political situation. Now that the price has reached its lowest level, people are shocked about the unprecedented announcement for belt tightening measures based on the declaration that the economic situation is worsening! This is coupled with many other procedures, which are ordinarily unrealistic and unsuitable for the actual reality.

Panic

It is sort of a panic and anxiety creating situation due to which there is no logical justification for the successive statements that were issued which threaten the national wealth and living standard of citizens. We should understand and remember that a barrel of oil used to be above $100 for over seven years and the excess funds were accumulating in banks and financial institutions. These excesses are massive enough to manage the country for several years comfortably such that there is no need to sell even a single barrel of oil.

Any close follower of the unfolding events should also realize that the dwindling oil prices are not real but intentional, because OPEC member states can increase the prices easily whenever they decide within the blink of an eye. They will only decide to reduce the production quota to increase the prices to the desired level, but what is happening now is deliberate for political reasons, as revealed earlier.

Even if Allah makes it a reality that the falling oil prices is beyond the control of the OPEC member states, an ordinary citizen will never believe the kind of official statements being issued about the declining oil prices because it is unrealistic and fake.

 Where did the excess funds go? How were they spent? Are they in the hands of extravagant spenders or trustworthy individuals? There seems to be no cause for alarm, as no logic indicates the need for belt tightening measures and unrealistic warnings about rainy days!

Funds

Citizens who were not privy to spending the excess funds are not responsible for the naïve and unrealistic statements released by officials without any concern about its impact on citizens who are always victims of these belt tightening procedures and austerity measures!

Economic reforms are seriously needed. The basic responsibility of the government is to ensure the comfort of citizens through best and professional management of national resources instead of threatening their comfort and standard of living with the release of illogical statements every now and then.

The following is a funny example of the actions being taken by the government. The government has decided to stop allocation of leased luxury cars for government officials and has replaced the move with allocation of KD250 monthly transportation allowance!

Basically, the decision to give officials luxury cars was very bad. Imagine that an assistant undersecretary has German-made latest model luxury official car without commensurable production, but is using the car for mere fancy and show of affluence. You can imagine how much it costs to hire a single car that costs the government over KD 600!

Those who desire reform will realize their way and those who plan to play on people’s intelligence by creating panic in them about a probable gloomy future of the economy will know their fate.

It is unfortunate that the country does not have a parliament right now that is capable of holding the government accountable for its actions. The government is full of competent and outstanding individuals, so I don’t know why they are not useful in dealing with the huge economic file.

The larger part of the file is under the administration of the Minister of Finance and Acting Minister of Oil Anas Al-Saleh. He is a good man but he will face difficulty in dealing with such complex files; as such, it has indeed become a huge burden for him to handle.

File

I also wish Dr Ali Al-Omair continues as the Oil Minister, a role that he has been performing excellently, so that Anas Al-Saleh can handle the finance sector squarely. However, the government took an inappropriate step by moving Al-Omair to another ministry and handed over the Oil Ministry to Al-Saleh!

Finally, it is certain that there is no real panic concerning the national economy and there is no reason for anxiety. Note that I did not mention about the foreign investments being handled by Kuwait Investment Authority and other government agencies. This is why I declare that the situation is good, even if the oil price reaches KD1 and not just below KD10 as it is now!

Twitter ID- @alzmi1969

By Yousef Awadh Al-Azmi

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