ECOFIN: Economic and Financial Committee

Topic A: The Hydrocarbon Economy: Curbing Reliance and Fostering Alternatives

Global demand for hydrocarbons has reached over 92 million barrels per day. According to the International Energy Agency, the combined resources of petroleum, coal, and natural gas account for over 80% of the world’s Total Primary Energy Supply. As a result, many countries have become over-reliant on both the production and consumption of these natural resources, and this over-reliance carries with it a variety of market pressures for different countries. It may be possible for countries to escape their reliance on traditional hydrocarbons (oil, petroleum, natural gas) by fostering the development of alternatives. In the global energy sector, classical hydrocarbons contend with alternative hydrocarbons, like biofuels, as well as other alternative energy sources. Some groups, including the Organization of Petroleum Exporting Countries (OPEC), argue that petroleum usage will naturally “phase out” as did coal usage at the start of the oil era. Others, however, call for more urgency. The economic argument for escaping over-reliance – that our current levels of production and consumption are unsustainable – is complemented by national climate policies and international agreements, including the landmark COP21 Paris Climate conference. Ultimately, several factors must be assessed in order for natural resources to fulfill their potential as a development tool and for countries with resource potential to avoid the “resource curse.”

Topic B: Diversifying African Commodity-Based Economies

A commodity is defined as any good that is used in exchange during a transaction. The African continent, with a diverse mix of developed and developing countries, is plagued by an economic slump of commodity-based trade. In particular, some heavily commodity-based economies in sub-Saharan Africa are watching demand drop as far as 60% for the commodities that fuel their respective economies. Solutions for this topic will diversify commodity-based economies throughout Africa. Furthermore, solutions will support the ECOFIN’s recent push for sustainable development, since it emphasizes policy purposed at solving the issue in the long-term. During debate, delegates will look into several key parts of the global economic system. These include how trade patterns, accessibility to resources, and financial systems all affect commodity-based markets. This topic focuses on the commodity market’s root issue in Africa today, and it seeks to resolve the problem with diversification and sustainable development policies.

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