Population, Energy and Environment Program : Comparative Analysis on the Distribution of Oil Rents
The issue of administering the distribution of oil rents is the subject of increased debate among oil companies, civil society, development agencies, and governments, which tacit agreement suggests that regions where oil and gas production takes place, in particular the communities, ought to receive "indemnifications" due to damages, and losses derived from the use of land for oil production operations. Such debate sparked the need for an analysis in the context of the tripartite dialogues of the Population, Energy and Environment Program (PEA), a joint initiative by the Bank, and the Latin American Organization for Energy (OLADE). This study presents PEAs comparative analysis of oil rent distribution in Bolivia, Colombia, Ecuador, and Peru, reviews the collection of rents as it relates to taxation of revenues derived from oil, and gas operations, and, examines the distribution, and disbursement of rents, giving special emphasis on the evaluation of the share of revenues, that could directly benefit the indigenous peoples. Recommendations suggest the development of a tax mechanism that distributes revenues equitably among governments, investors, and social groups, in the context of strong institutional capacity of government agencies, in order to absorb economic change, and ensure the efficient investment of revenues; but, taking into account the fact that while increased hydrocarbon exports does generate the valuation of exchange rates, building pressure on costs, and prices of national goods, such exports will in turn decrease the level of competitiveness of national goods, harming diversity, as well as the balance of the domestic economy.
| Summary: | The issue of administering the
distribution of oil rents is the subject of increased debate
among oil companies, civil society, development agencies,
and governments, which tacit agreement suggests that regions
where oil and gas production takes place, in particular the
communities, ought to receive "indemnifications"
due to damages, and losses derived from the use of land for
oil production operations. Such debate sparked the need for
an analysis in the context of the tripartite dialogues of
the Population, Energy and Environment Program (PEA), a
joint initiative by the Bank, and the Latin American
Organization for Energy (OLADE). This study presents PEAs
comparative analysis of oil rent distribution in Bolivia,
Colombia, Ecuador, and Peru, reviews the collection of rents
as it relates to taxation of revenues derived from oil, and
gas operations, and, examines the distribution, and
disbursement of rents, giving special emphasis on the
evaluation of the share of revenues, that could directly
benefit the indigenous peoples. Recommendations suggest the
development of a tax mechanism that distributes revenues
equitably among governments, investors, and social groups,
in the context of strong institutional capacity of
government agencies, in order to absorb economic change, and
ensure the efficient investment of revenues; but, taking
into account the fact that while increased hydrocarbon
exports does generate the valuation of exchange rates,
building pressure on costs, and prices of national goods,
such exports will in turn decrease the level of
competitiveness of national goods, harming diversity, as
well as the balance of the domestic economy. |
|---|