The Organization of African Petroleum Producing Countries (OPPO) is calling for African countries to take greater control over their natural resources. Secretary General Farid Ghezali stated that the continent is not benefiting enough from its resources, including hydrocarbons and minerals. He argued that partnerships with foreign operators and investors have not yielded sufficient economic returns or promoted local industrial capacity development.
Ghezali emphasized the need for a new type of partnership based on shared value creation. He noted that current contracts often favor foreign companies, leading to unequal benefits for African countries. The OPPO chief called for a shift in focus towards economic returns, technology transfer, and human development. This approach would enable African countries to maximize the benefits from their resources.
Ghezali's comments were made during an interview on Algerian radio, where he highlighted the need for African countries to rethink their partnerships with foreign investors. He cited his visits to several African countries, where he observed a lack of technology transfer and personnel training. Instead, he noted that production is often focused solely on extracting resources, which he described as "afflicting."
To address these challenges, Ghezali advocated for increased cooperation among African countries and the development of inter-African partnerships. This would facilitate the sharing of expertise and the creation of local value chains. He also acknowledged that this new approach may raise concerns among foreign partners but stressed the need for open and honest dialogue.
One of OPPO's priorities is to harmonize petroleum codes, particularly taxation, among its 18 member countries. Ghezali argued that this would enable producing countries to control the exploitation of their resources. He also highlighted the difficulties faced by some African countries in generating sufficient revenue from their resources, citing the example of countries that only have 15% of their resources available for their populations' needs.
The OPPO chief also pointed out that Africa produces 7-8 million barrels of oil per day but only refines 30%. This means that around 70% of production is exported as crude, while African countries rely heavily on imports of refined products. Developing local refining capacity is crucial to reducing this dependence and increasing value added on the continent.
Ghezali emphasized the need for a common regulatory framework to promote policy convergence and a more coherent environment for cooperation among African producers. This would enable countries to move beyond exporting raw materials and focus on local transformation, industrialization, and job creation. The OPPO's new approach aims to make natural resources a source of revenue and a driver of industrialization, skills development, and value creation for African societies.
Key points
- African countries should take greater control over their natural resources to maximize benefits.
- A new type of partnership based on shared value creation is needed.
- Developing local refining capacity is crucial to increasing value added on the continent.
