Outlet: Arab News

Language: English

Abstract: Africa’s major oil-producing countries, despite high global oil prices, are facing a decline in production, leading to economic challenges and stalling transitions to low-emission economies. Nations such as Nigeria and Angola have seen lower trade surpluses and diminished oil revenues compared to a decade ago, exacerbated by under-investment, outdated legislation, and competition from emerging oil exporters. Declining global oil demand, driven by factors like China’s economic slowdown, has worsened the situation, further decreasing investments in the African oil sector. As aging infrastructure and shrinking oil fields lead to reduced output, these countries struggle to maintain public services and social programs, while managing high levels of debt and constrained fiscal space.

The dwindling oil revenues are also hindering investment in alternative energy and sustainable development. Countries like Equatorial Guinea, where oil production has significantly dropped, illustrate the precarious position of African petrostates. As these nations attempt to attract new investments through tax incentives, their long-term sustainability remains uncertain. Meanwhile, poorer African countries, already grappling with climate change-induced challenges, are left even more vulnerable without the buffer of oil wealth. Addressing these interconnected issues, particularly at global platforms such as the UN Climate Change Conference, is crucial to avoiding a deeper financial and environmental crisis across the continent.

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