Wednesday, April 11, 2012

Strategic Issues Facing Latin America- AFIL Seminar #11

For our next seminar we focused on issues facing Latin America. What was unique about this seminar is that we all had the opportunity to submit 2-3 questions beforehand, which fueled the overall discussion.

I'll pick a question from each AFIL member (so no one feels left out) to give a sample of the types of questions that were asked.
*Some were shortened for brevity*

Mariah- "What Latin American countries are most closely tied to the United States in the oil business?"
Paulina- "What are some ways that Latin American countries, particularly Mexico, can reduce their corruption, increase employment rates, and decrease violence?"
Polly- "If the Keystone Pipeline is modified and approved to start, how would this American oil project affect oil production and sales of Latin American oil.
Steven- "Can the U.S. learn anything from the countries that have managed energy regulations well and used those decisions to fund social programs?"
Claudia- "Why is the U.S. a step behind the emerging [BRIC] countries regarding alliances during such a strategic time to build ties with long-term economic benefits?"
Elaine- "How do the federal regulations of drilling site locations differ between Central/South America and the United States?"
Norair- "Is it feasible for Latin American countries to create something like 'Latin Union' or 'the Latin States' depicting from the European Union and the United States respectively?"
Alayne- "While oil prices continue to rise, we continue to read more and more about countries with great oil supplies. If this is really the case, shouldn't the competition in oil and gas markets be causing the price of oil to go down instead of up?"
Philip- "What is the difference in nationalizing and privatizing these energy companies and are there pros and cons to each method?"
Mark- "How stable are government regimes in Central America, south of Mexico?"
Eva- "With tourism as a major source of income for many of these countries, what is being done to increase the safety of travelers and residents in Latin America and the Caribbean?"
Maryam- "What is the future of oil and gas industry in Brazil?"
Nga- "One of the prestigious Petroleum Engineering professors, Dr. Economides, had stated that 'we will never run out of oils' (at least in the near future). What is your thought on this view?"
Abbie- "The oil industry in the Middle East has resulted in one of the largest and fastest transfers of wealth in history. With such significant hydrocarbon resources in Latin and South America, do you think we are getting ready to see a similar transfer?"
Hassan- "Do you think there will be a 'Venezuelan Spring'?"
Allison- "Many Latin American countries seem to favor more of a socialist or liberal economic policy. Do you think this economic philosophy is a threat to American investors?"
Amal- "Poverty in Latin America is at its lowest level in 20 years... what are governments' current efforts to improve the poverty rates?"
Allan- "What steps are countries in Latin America taking to preserve the natural environment from spills, pollution, or other problems that stem from oil & natural gas production"
Belen- "How do you convince foreign companies to invest in unstable economies or unstable governments such as Bolivia and Venezuela?"
Brady- "Is there any concern or history regarding organized crime entering the booming Latin American energy sector?"
Brawnlyn- "Where do you see Brazil's oil exportation market in the next 50 years with the rising situation in the Middle East?"
Cal- "Why do you believe that Brazil's BTG will be able to retain it's rapid growth, amid the European financial crisis?"
Paul- "What sort of political movements are primed to gain most from the influx of oil money?"

Although we did not get to cover all of the questions, Dr. Zeissig tried his best to touch on the ones that he felt were the most important. I wrote a ton of notes down, but it's hard to summarize my notes because they were basically the responses that Dr. Zeissig had on each question.

I'll let the other AFILers share their thoughts on the discussion.

2 comments:

  1. I guess I'll start...

    I liked Dr. Zeissig's presentation. As we discussed last night, he was probably a little biased by being in the oil industry. His statement that the oil pipeline wouldn't be a problem because it would be built with "extra care" struck me as a little too optimistic; I imagine the Deepwater Horizon rig was also built with "great care." But at the same time, I think past incidents make it more likely that the pipeline would be given extra scrutiny. Furthermore, with the Keystone pipeline being so well publicized, there would be extra pressure not to mess it up, so perhaps Dr. Zeissig's remark wasn't so far off.

    Another key takeaway point regards environmental legislation: you can make all the laws protecting the environment you want, but if the government doesn't enforce them, they're pretty much worthless. Human nature being what it is, I'm afraid corruption enters the equation far too often, resulting in good laws that are simply ignored. Fine if you're only interested in immediate profit, but at what cost to the future? On a more practical level, how do you eliminate this corruption?

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  2. Abbie, you talked about "at what cost in the future." I know I talked about Bolivia quite a lot, but many of the issues we discussed during Dr. Zeissig's presentation are issues Bolivia is currently facing.

    Most of the profits of underdeveloped countries come from natural resources, yet with the lack of education and technology to extract these properly the environment has to pay the price.

    Bolivia shares part of the Amazon with Brazil and bordering countries. The Bolivian Amazon is not only experiencing massive deforestation for wood, but also due to coca plantation. Instead of selling tropical fruit like before, farmers are selling coca for cocaine and making more than they could have imagined. The country's economy is also booming due to the huge profits cocaine makes. What is overlooked is that unlike before when fruit was amazingly cheap in Bolivia, it now has to be imported at a very high price. The coca plant also dries out the land making it almost impossible to plant anything there in the future. Finally, many rain forest species are becoming endangered due to the loss of habitat.

    But how do you tell countries such as Bolivia to stop doing what is giving them money when they see other countries prospering and not themselves? Although there is no answer I think it starts with education. I think one of the main reasons developed countries don't cause such a direct harm to the environment is because they understand the effects. Foreign companies investing in these countries should set the example by establishing and enforcing laws that protect the environment even though the country itself might not necessarily due so. If the country is corrupt, and the foreign companies become corrupt, and no one is teaching anyone about effects in the future, then how can one move forward?

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