VIENNA: OPEC ministers resumed talks on Friday before further discussions with 10 key partner countries, including Russia, later in the day to thrash out an agreement on production cuts.
Amid sharp differences over which way to go, the oil market continued under pressure.
In early trade Friday, the price of Brent, the European benchmark, was again under the symbolic $60 mark after a slump Thursday when the cartel failed to reach an expected accord on cuts to stem price falls.
“No, I am not confident” about the chances of a deal, Saudi oil minister Khalid Al-Falih told reporters after a long day of negotiations at OPEC headquarters in Vienna.
However, OPEC and non-OPEC members — who combined account for around half of global output — agree on one thing: a glut on the market has led to oil prices falling by more than 30 percent in the space of two months.
OPEC, partners face stiff test to agree oil cut deal
OPEC, partners face stiff test to agree oil cut deal
- Amid sharp differences over which way to go, the oil market continued under pressure
- A glut on the market has led to oil prices falling by more than 30 percent
Trade, investment vital for emerging markets, says Saudi economy minister
RIYADH: Trade and investment are essential drivers for the continued growth of emerging market economies, according to Saudi Arabia’s Minister of Economy and Planning Faisal Alibrahim.
Speaking at the opening of the second edition of the AlUla Conference for Emerging Market Economies, Alibrahim addressed a panel titled “Paper Session 1: Resettling Global Trade,” highlighting the importance of building resilient economies to withstand ongoing global challenges.
“Global trade is not coming to an end. Trade and investment are still central and crucial for a lot of economies, especially emerging market economies, and as such they will always pursue for trade to continue to flow,” Alibrahim said.
“We talked about re-allocation and I think that’s very important. But today, what we were used to, which is a rules-based market system, this is becoming under strain and then with this strain, we’re seeing that resilience is making a difference. Countries that are built or designed to be more resilient with institutional capabilities could fare better,” he added.
Alibrahim also noted that while advanced economies benefit from buffers and policy space, allowing them to better weather economic strains, emerging markets face more pressure to adapt swiftly.
“However, emerging market economies can’t have the same flexibility and it will be more of an imperative for them, a stronger imperative for them to adapt,” Alibrahim said.
“As reallocation becomes the norm that we’re seeing today, we will see that countries will be exposed; those who know how to adapt versus those who can’t adapt,” he continued.
On the topic of US-China trade relations, the minister emphasized that these tensions would not lead to a reduction in global trade but would prompt ongoing reallocation that countries must adjust to.
“We shouldn’t view these, I’d say, moments of pressure as inherent failures. These are actually signs that there’s misalignment between institutions and a continuously evolving economy. Sometimes, the economy, the global economy, evolves at a slower pace and sometimes it surprises us,” Alibrahim said.
“Dealing with this re-allocation is not just about preserving a fixed notion of stability that gives us the illusion of control, it is about day-to-day disruption some people call it innovative policy making that allows us to really preempt these changes and be ready for it,” he added.
The minister further stressed that countries with strong institutional frameworks would be better positioned to navigate these challenges.
“This requirement will be a test on institutional delivery and how countries that have invested institutional capabilities, institutional setups will witness better outcomes because they’re ready for it,” Alibrahim concluded.
Also participating in the panel, Federico Sturzenegger, Argentina’s minister of deregulation and state transformation, shared insights into the shifting landscape of US-China trade.
“Actually, when I read the numbers, even as a kind of uninformed policymaker, I was not aware of this, it got from 22 percent of US imports to 8 percent and this has happened over the last 10 years,” Sturzenegger said.
Eyob Tekalign, governor of the National Bank of Ethiopia, also spoke on Ethiopia’s efforts to address long-standing macroeconomic distortions through reforms in collaboration with the International Monetary Fund.
“Macro reforms actually is not anti growth. Because if we take this context, what we saw is, everything that needs to go up is going up; everything that needs to go down is going down. We’ve seen a significant reduction in inflation from above 30 percent to single digits, 9.7 percent this December,” Tekalign said.
“If we want to see, you know, significant benefit from trade that agility, that regional readiness is absolutely critical,” he added.
The Saudi Ministry of Finance and the IMF launched the second edition of the annual AlUla Conference for Emerging Market Economies, bringing together economic leaders, finance ministers, central bank governors, and experts from around the world.
This year’s conference, held on Feb. 8-9, focuses on the ongoing transformations in the global economy and the challenges and opportunities they present for emerging markets, particularly in trade, monetary and financial systems, and macroeconomic policies.
