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In this region of the world, it is expected that by 2050 there will be 300 million young people entering the labor market.

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April13, 20216 min read

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The so-called knowledge revolution is based mainly on the rapid growth in scientific and technological innovation for the production of goods and services in an economic system.

The structural and institutional transition from resource-based economies such as oil and gas to knowledge-based economies has become the common denominator between countries in the Middle East and North Africa . In this region of the world, it is expected that by 2050 there will be 300 million young people entering the labor market. Most of the jobs that they will demand do not yet exist and will mostly be in the private sector. Governments are aware of their high dependence on hydrocarbons and several have begun strategic economic transformation plans now that they can invest in developing various sectors.

The reality is that transforming an economy is a difficult and long-term job, so there are several cases that have not achieved it and others that are doing better than others. The region also has a privileged geographic location with access to large markets and the population, in addition to being young, is highly educated. That is why we can learn from the cases of these four Middle Eastern countries that have had economic development plans in place for several years and have found in the creation of an entrepreneurial culture a path for transformation.

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This Middle Eastern country with access to the Mediterranean Sea takes the famous nickname of Start-Up Nation. In 2009, Dan Senor and Saul Singer published a book of the same name explaining "the history of Israel's economic miracle" in which they precisely talk about how culture has helped since then to be the country with the most technology-based companies per capita around the world. It is a country that has gone through several wars and does not have enough natural resources, but they have found a way to develop and transfer the knowledge in technology that is normally bought by other foreign companies in the Western world.

According to the2020 Startup Genome ecosystem rankings, Israel's capital, Jerusalem, ranks sixth globally. The culture in this country is one of collaboration between entrepreneurs and investors with a shared sense of responsibility to move the country towards a technological leader. Something that has been developing from the military antecedents and the high migration that exists. According to The Economist , the Israeli entrepreneurship ecosystem is characterized by a can do attitude and high resilience to failure.

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Recently attracting the attention of the world for the FIFA soccer world cup and for the lifting of the trade blockade that it had since 2017 with its neighboring countries, today it is an example of transformation and vision for the future. Since 2008, the State of Qatar established an economic development plan called the Qatar National Vision 2030. Its vision is also to diversify the economy to reduce dependence on hydrocarbons that currently represent 90% of the country's income. In this plan, entrepreneurs are recognized as key in the transformation process and a special emphasis is placed on supporting the development of innovation, research and development skills.

In my experience, the case of Qatar is unique because of the special emphasis on supporting from education and through public and private institutions the development of small and medium-sized companies with which I have had the opportunity to collaborate. As can clearly be seen on a visit to Education City or to Qatar University . In Qatar, an atmosphere of collaboration and openness is perceived to create support networks to move the country towards that national vision, driven by the search for self-sustainability that resulted from the trade blockade, but which now, starting in 2021, opens new opportunities to explore international markets with neighboring countries.

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Like Qatar, Saudi Arabia has a vision for 2030 that considers developing the entrepreneurial ecosystem to increase the contribution of small and medium-sized companies to the gross domestic product. This plan considers human capital as strategic for the growth of the ecosystem and the government has decided to inject resources into the creation of a venture capital fund, government support programs, financing for companies and exports, among other things. The Saudi Vision 2030 has proven to be a long-term strategic development plan that has attracted entrepreneurs and investors to this region of the world. A favorable business environment is perceived for those who want to undertake and it is one of the largest markets in the Arab world.

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The United Arab Emirates is best known for its cities Abu Dhabi and Dubai. The government has played an important role as an institutional entrepreneur supporting the development of the ecosystem by investing in infrastructure projects, commercial opening, development of the entrepreneurial culture and diversification of the country's income. In the region it is one of the countries where it is "easier" to create a company as a foreigner. In just 30 years you can see the great development that its cities and the economy in general have had.

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4 Middle Eastern countries that are establishing a culture of entrepreneurship to transform into knowledge-based economies - Entrepreneur

Higher oil prices, an expected global economic rebound and growing oil demand are set to lower the fiscal breakeven price of major Middle East producers, according to the International Monetary Fund.

The fiscal breakeven price is defined as the oil price needed to balance the budgets of oil-exporting countries.

As oil prices declined and fields matured in several Middle East countries, raising production costs, the breakeven price for several producers increased.

However, with oil prices rising this year owing to better growth prospects for the world economy, breakeven prices for resource-based economies in the Middle East appear to be narrowing.

The IMF raised its global economic outlook to 6 per cent from and earlier 5.5 per cent forecast, as a result of quicker Covid-19 vaccination campaigns and fiscal and monetary support provided by governments and central banks.

For Saudi Arabia, the biggest oil exporter in the world and the Middle East, the breakeven price is set to decline by 15.6 per cent from a year ago to $65.70 a barrel in 2022, according to the fund.

Saudi Arabias fiscal breakeven price, which was $77.90 a barrel in 2020, is expected to decline marginally to $76.20 this year. The price has been steadily falling since 2018, when it was $88.60 a barrel.

The fiscal breakeven price of Iraq, Opecs second-largest producer, has increased steadily since 2018, when it was $45.40 a barrel.

This is due to higher spending, particularly to maintain a bloated public sector over the past couple of years, and a fiscal crisis last year that exhausted the country's domestic borrowing capacity.

Last year, Baghdad had a fiscal breakeven of $63.70, which is expected to hit $71.30 this year before falling to $66.10 in 2022.

Iran, one of the most populous nations in West Asia, has been squeezed by US sanctions and hit hard by Covid-19, resulting in the worst death toll in the Middle East.

Higher fuel prices and the impact of the pandemic on the global economy have exacerbated its financial crisis.

Iran needed oil prices to average $304.30 a barrel to break even fiscally in 2020. Its numbers are expected improve relatively in 2021 to $242.80 a barrel. However, its breakeven price is expected to rise to $259.20 in 2022.

Libya, the second-biggest producer of crude in North Africa, is one of the lowest-cost producers in the region.

Known for its light, sweet grade of oil, the country faced severe setbacks in terms of exporting oil due to a blockade that lasted about a year.

This caused its fiscal breakeven price to rise by 336 per cent to $417.50 a barrel last year.

However, in one of the steepest declines among oil producers in the region, Libya's fiscal breakeven price is expected fall by about 88 per cent to $48.80 a barrel this year.

The price needed to balance its budget will decline further to $46.70 in 2022, which will be the region's lowest after Qatar, which is largely a gas producer.

Libyas reversal of fortunes follows the end of the blockade, which allowed it to substantially increase its export volumes.

Its production rose to 1.19 million barrels per day in March, about 10 times higher than the 121,000 bpd it produced in the third quarter of last year, according to secondary Opec sources.

The UAE, Opecs third-largest producer, is expected to have a fiscal breakeven price of $60.40 in 2022, down from $68.20 in 2020 and $64.60 this year.

Bahrain, which traditionally has had one of the highest fiscal breakeven prices among Gulf countries due to its early decline in reserves, will have a breakeven price of $88.20 this year and $85.80 in 2022, compared with $100.40 in 2020.

Omans fiscal breakeven price will reach $61.80 a barrel in 2022, while Kuwait will need a price of $64.50 to balance its budget.

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Higher oil prices and economic recovery support lower fiscal breakeven prices for Middle East producers - The National

B.C.s commercial and sport fisheries are in trouble, thanks to declining wild salmon stocks|Rob Kruyt

Everyone by now knows what is meant by the green economy.

But what about that blue economy that the World Bank and the Justin Trudeau government have been talking about lately?

The World Bank defines the blue economy as sustainable use of ocean resources for economic growth.

The global ocean economy is worth an estimated US$1.5 trillion now and is expected to grow to US$3 trillion by 2030, according to Rashid Sumaila, University of British Columbia professor at the Institute for the Oceans and Fisheries.

Given that Canadas coastline borders on three oceans and it is the country with the longest marine coastline, Canadas oceans are an underused resource with significant economic potential in seafood production, tourism and renewable offshore wind and tidal energy generation.

The Trudeau government wants to develop a blue economy strategy, but isnt clear on what that strategy should include, which is why it is seeking input from Canadians through its blue economy engagement process.

Combined, our ocean industries generate over $30 billion a year in GDP, federal Fisheries and Oceans Minister Bernadette Jordan said last week at a virtual forum on the blue economy hosted by the Greater Vancouver Board of Trade (GVBOT). Yet our blue economy lags behind other countries like Norway, the U.S., the UK and Australia. To me that screams potential.

But if Canadas blue economy is to include aquaculture, it is off to a rocky start in B.C. Jordan is shutting down a quarter of the provinces salmon farms with her order to have 19 open-net sites in the Discovery Islands off the water by 2022.

A good start for a blue economy strategy would be a federal aquaculture act, said forum panellist Jennifer Woodland, CEO of Nuu-chah-nutlh Seafood and chairwoman of the Canadian Aquaculture Industry Alliance.

Nuu-chah-nulth Seafood is a First Nations company involved in commercial fishing, salmon farming, seafood canning and, more recently, seaweed cultivation.

Aquaculture is one of the fastest growing sectors in world, Woodland said, and were watching every other jurisdiction take their place globally as aquaculture leaders. Canada should be a leader in sustainable aquaculture development.

For B.C., the biggest blue economy opportunities are in sport fishing, whale watching, cruise ships, kayaking, aquaculture and commercial fishing.

But both its saltwater sport fishing and commercial salmon fisheries are in trouble, due to declining wild stocks, and salmon farming is in trouble due to activism and bad optics.

B.C.s commercial sockeye fishery has been in decline since the mid-1990s. Compared with Alaska, Russia and Japan, B.C.s commercial salmon fishery has all but vanished.

The salmon fishery and fishermen and processors are close to collapsing, said Joy Thorkelson, former president of the UFAWU-Unifor fishermans union in B.C. In 2019, the commercial catch for salmon in B.C. was the lowest in 70 years, she said.

Declining chinook stocks, meanwhile, have resulted in so many restrictions and closures that American tourists who pay big bucks to fish in B.C. may eventually stop coming.

Some efforts are being made to address the wild salmon decline. Under the joint federal-B.C. Salmon Restoration and Innovation Fund, $142 million is being invested over five years in initiatives like salmon habitat restoration.

Mike Meneer, president of Pacific Salmon Foundation, said past salmon habitat restoration and enhancement efforts have had some success in bolstering coho stocks.

While rebuilding Pacific salmon stocks would be an important part of a blue economy plan, if warming ocean temperatures from climate change are the principal cause of the declines, habitat restoration may not be enough to reverse it.

Unlike Atlantic cod, Pacific salmon are more abundant now than they ever have been. But that abundance is concentrated in cold northern regions, like Alaska and Russia. Northern range abundance may also be partly attributed to industrial-scale hatcheries in Alaska, Japan and Russia, which pump more than one billion juvenile salmon into the Pacific Ocean each year.

One question Jordan may need to wrestle with as part of her blue economy discussion is whether Canada should follow Alaskas lead and move from salmon farming to salmon ranching by increasing Fraser River sockeye stocks with industrial-level hatchery production.

And if the federal government is determined to shut down coastal open-net salmon farms in B.C., subsidizing a transition to open ocean fish farms may be less risky than betting on land-based closed containment recirculating aquaculture systems (RAS).

Jordans own Fisheries and Oceans advisers have determined RAS to be expensive and not economically viability.

While closed containment appears to solve many of the current problems that represent impediments to net-pen farming in coastal waters, nearly 100% of the startups using this technique have gone bankrupt, a 2018 Fisheries and Oceans memo to the fisheries minister noted.

Open-ocean farming may prove a viable alternative.

SalMar, a Norwegian salmon farming company, has developed the first offshore fish farm, away from the coast, which reduces the chance of wild and farmed fish interacting.

The company has now produced two harvests of Atlantic salmon and reports low sea-lice levels and low mortalities.

As for other forms of aquaculture, one relatively new crop for B.C. is seaweed and kelp. Ocean Regenerative Aquaculture is planning to cultivate seaweed for products such as biostimulants, which can be used in agriculture to improve crop growth.

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Moving Canadas blue economy out of the shallows - Business in Vancouver

BUSINESS

The Green Connection economic researcher Gillian Hamilton says: Our research shows that the development of an oil and gas industry is likely to further entrench South Africa as a minerals resource-based exporter, exacerbating the negative features documented by the National Planning Commission of SA that there is little evidence from elsewhere in Africa that the exploitation of oil and gas resources naturally leads to improvements in the lives of those living and working in oil- and gas-rich areas.

In fact, the report reveals that it normally leads to a wholesale deterioration in living conditions for the vast majority of citizens who live and work in such areas.

READ: African Development Bank backs young agripreneurs to beat climate change

The report cites a number of examples, including Nigeria, Uganda and Mozambique, where the only real beneficiaries were the companies that were awarded drilling rights and corrupt government officials, while the surrounding communities were left to suffer devastating environmental impact and governments were left in more debt as a result of the projects.

The Green Connections strategic lead Liziwe McDaid said: Through our #WhoStoleOurOceans campaign, we aim to empower local ocean-dependent communities to secure fisher livelihoods while ensuring that their tools and knowledge are sustained, and communities are able to engage with decision-makers for the protection of our oceans for all, forever.

Hamilton agrees: Operation Phakisa, which was launched in 2014, was designed to boost economic growth and create jobs within the context of the governments National Development Plan. One of its focus areas is the oceans economy.

But rather than focus on the stewardship of the ocean and the sustainable use of these resources, Operation Phakisa seems to have prioritised the establishment of a potentially devastating offshore oil and gas industry.

She adds that it was predicted that governments fast results delivery programme would contribute R177 billion to South Africas GDP and create 1 million jobs by 2033, but it is far from delivered these economic gains. Meanwhile, the contribution of the ocean economy to the countrys GDP has declined as a percentage of GDP, from 4.4% in 2010 to 4.2 % in 2019.

The model points out that investment in the countrys oil and gas industry will not deliver significant tax revenue for the fiscus.

Research model raises concerns over overstated gains

To determine the economic impact of oil and gas, an economy-wide model was developed in 2015. It indicates that a 20% short- or long-run increase in the production of crude oil, petroleum and gas in the country will increase real national GDP by 0.15% in the short run, while decreasing GDP by 0.12% in the long run.

This decrease in real GDP raises concerns around the economic viability of South Africa investing in an oil and gas industry.

The model points out that investment in the countrys oil and gas industry will not deliver significant tax revenue for the fiscus.

In the short term, it may form a platform for job creation and employment, with minor wage increases, but only if the capital equipment necessary for extraction is produced in South Africa. A report by Standard Bank, which assumes an oil price of $110/per barrel of oil, notes that 20 500 skilled and 33 000 unskilled jobs would be needed to service the oil and gas sector.

However, it is more likely that in the long run real wages will decrease marginally and there will be a long-term shift to skilled rather than unskilled labour, says Hamilton.

Job creation greatly exaggerated

Multiple studies show that the oil and gas industrys promises of job creation from the drilling of natural gas have been greatly exaggerated, Hamilton adds.

Many of the jobs that are created are short-lived or have gone to out-of-area workers who have the necessary skills. In addition, up to 75% of workers will likely become redundant in the future due to automation.

The gender bias of the oil and gas industry with only 3.6% female representation among the total offshore workforce should also be noted.

Experience closer to home indicates that job projections and actual job creation do not necessarily match. In terms of job creation to date, Phakisa is a failure. Between 2014 and 2019, while more than R40 billion was invested in targeted maritime sectors, fewer than 10 000 of the 77 000 direct jobs promised had been created, she says.

There are several other pitfalls for South Africa. Economic analysts caution that there is a substantial decline in demand for fossil fuels, together with an excess in supply. Moreover, climate-related financial risks such as transition risks, stranded assets and the negative impact on our trade and competitiveness, as well as physical climate risks, should all be taken into account before investing in resource extraction.

Evidence shows that where they exist, non-renewable resource booms both entrench existing weak governance institutions and weaken effective governance institutions.

Hamilton says: The localised influx of capital and labour can lead to serious social issues. Extensive migration into oil-producing areas places strain on public infrastructure, resulting in more poverty and poor healthcare, high rates of child mortality and an increase in gender and economic inequality, along with more crime.

And while a growing population clearly needs more infrastructural support in terms of basic municipal services such as health, education, emergency services, water and sanitation, electricity, and transport the sad reality is that most affected municipalities in the country will be entirely incapable of dealing with the increase in demand for public services that will come with the emergence of an oil and gas sector.

READ: Major fall in demand hits Africas oil producers

Evidence shows that where they exist, non-renewable resource booms both entrench existing weak governance institutions and weaken effective governance institutions.

These research findings do not bode well for South Africa, especially since we live in a country that has been characterised by looting, incompetence and malfeasance in recent years, she adds.

McDaid says the research report concludes that it is time for South Africa to shift away from an extractive mindset and acknowledges that an accelerated adoption of renewable energy, coupled with increased energy efficiency, could really be the real game-changer.

In addition, the commodification of the countrys oceans, as a site for yet more capital accumulation, must be rejected.

We must start seeing the ocean as an asset that must be protected, not exploited; an asset that provides immeasurable social, cultural and climate benefits to us all, and which needs a broad coalition of citizens and organisations, and an accountable government standing against the predation of the oil and gas industry, concludes McDaid.

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Green Connections research on economic impact of off-shore drilling in SA exposes negative benefits - News24

Among the instruments, the document highlights UN regulations that help create a loop to optimize the use of resources, such as regulating the reuse of vehicle tire carcasses by renewing the tires tread and enabling it to have a second or third life.

The toolbox points to several resources on people-first public-private partnerships (PPPs), including Guidelines on Promoting People-first PPP in Waste-to-Energy Projects for the Circular Economy. Another resource is a set of good practices on promoting innovation for sustainable consumption and production.

Instruments to support circularity in energy include the UN Framework Classification for Resources, and recommendations on carbon capture and storage (CCS). In forestry and timber, a forthcoming study will discuss how the forest sector implements circular economy concepts. The toolbox notes that forest products are particularly suitable to circularity, noting for example that reuse and recycling are common in lumber salvage and paper recycling, and it is a long-standing practice to use waste throughout the wood products sector, for example in energy production.

UNECE aims to harness international trades contribution to circularity by addressing food loss and waste in agricultural trade and supply chains, among other initiatives.

The document cites an implementation framework aimed at improving circularity in cities, contained in the Guide to Circular Cities prepared within the United for Smart Sustainable Cities (U4SSC) programme in 2019. It asserts that cities must begin to rely on circular cycles of production and consumption within city boundaries and strengthen the ability of their infrastructure to withstand natural and human-made shocks.

To improve measurement of the circular economy, the toolbox publication reports that the Conference of European Statisticians (CES) and other international organizations are developing a harmonized approach to measuring circular economy. A 2020 UNECE review of measuring circular economy provides a set of recommendations to this end.

The document adds that UNECEs environmental performance reviews (EPRs) enable countries to assess progress in greening their economies. 15 UNECE members have conducted EPRs as of November 2020.

The toolbox will be discussed during UNECEs 69th session convening from 20-21 April 2021. The theme of the session is promoting circular economy and the sustainable use of natural resources in the region of the Economic Commission for Europe. Discussions will also be based on a UNECE report on trends and opportunities in circular economy for Europe: key challenges and opportunities.

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With this tools the UN Economic Commission for Europe help governments to build up more circular economy - Waste Management World

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Reductions will have wide-ranging economic, intellectual and social impacts, Northern economists say

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The impact of job and program cuts at Laurentian University this week will have profound and potentially long-term effects on the economy in Sudbury and Northeastern Ontario, experts told The Sudbury Star this week.

Laurentian, which filed for creditor protection in February, announced on Monday it would cut 58 undergraduate and 11 graduate programs, while laying off 110 faculty as part of its court-supervised restructuring under the Companies Creditors Arrangement Act.

Livio Di Matteo, professor of economics at Lakehead University in Thunder Bay, said the fact Laurentians administration has chosen to restructure under the CCAA is indicative of the dire situation in which the university finds itself.

Companies that go into that type of creditor protection are most often private sector firms, he said, which are well-defined entities with a relatively narrow function.

CCAA restructuring is a rather blunt tool, because its basically to satisfy creditors and creditors, as long as they get their money, are quite happy with cost cuts being paramount, as opposed to any type of long-term impact and what the plan is for long-term revenue projection and recruitment, Di Matteo said.

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Most universities have exigency provisions, but they really are long and cumbersome. This is the other extreme.

The cuts announced on Monday will have a major impact, he said, both immediately and in the longer term, as the school has shed roughly a third of its course offerings and about 30 per cent of its faculty.

I have heard 100, 110, but that is just faculty theres no numbers on staff, Di Matteo said. Just faculty alone, based on average salaries, youre looking at a $15 (million)-$20 million direct hit to wages in Sudburys economy. If you look at indirect effects, in terms of the spending and multiplier effects, youre probably looking at an impact of anywhere from $30-40 million.

Administrative positions and other staff may account for just as big a hit, he said, pushing the number to $60-80 million in direct impact on the local economy.

A potential drop in enrolment, as students consider options other than Laurentian to pursue a post-secondary education, means less money will be spend locally on residence, apartments and restaurants.

Its hard to do an economic impact analysis on the fly, but I would be surprised if the total loss in the immediate term to the economy of Sudbury wasnt in the $100-150 million range, once the impact on wages, salaries, staff, faculty and student spending are all factored in, he said.

Natalya Brown, associate professor of economics and co-ordinator of the economics program at Nipissing University in North Bay, said the laid-off Laurentian faculty and staff, whose jobs help support local businesses and charities, will not easily find work theyre qualified for in the North.

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They have also bought homes, so that could have implications for the housing market, as well, said Brown, reached on Tuesday afternoon. Youre going to see a lot of that expenditure leaving the community and a lot of that expertise and brain drain in the community, and thats not just going to have an impact in the short term, but in the long term, because having a university with a wide range of programs is an attraction piece for Sudbury. It attracts a lot of students, not just from the region, but also outside of Ontario and internationally. A lot of those students stay in the community, because they like what they see, so this could have impacts on skill-matching and labour shortages in the future.

Universities are creativity centres and drivers of innovation, Brown said, and researchers often consult with local businesses and give their time to social enterprises and charities, which could be sources of future growth.

Especially on the environmental front, with the kind of resource-based economy we have in the North, researchers are very important players, she added.

Im wondering wonder how the decisions were made in terms of which programs were cut. You look at the list and I was surprised to see environmental studies and some other programs that I think young people are really getting excited about and are very attractive programs being cut, because I think there will be growth in the future. A university is not a corporation and it has a responsibility to the community that it is in to provide relevant programming, and it just seemed weird that these programs were cut in areas where we need that expertise and we need to build a workforce with those skills and knowledge.

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Contacted on Tuesday, the Greater Sudbury Chamber of Commerce said it was unable to accommodate an interview request, but supplied a statement from Cora DeMarco, chair of its board of directors.

Laurentian University is a key economic pillar of our community, and has contributed immeasurably to Sudburys growth, research, economic wellbeing, and quality of life; it is one of the many reasons Sudburians are proud to call Sudbury home and why Sudbury remains an attractive option for international students, DeMarco said. We acknowledge the university is undergoing a challenging and difficult restructuring process, and our thoughts are with those impacted. We are optimistic the institution will emerge out of this process to remain a key economic contributor and employer within our community.

bleeson@postmedia.com

Twitter: @ben_leeson

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Laurentian cuts could take more than $100 million out of Sudbury's economy - The Sudbury Star