Kuwait Times

Published Date: April 02, 2008
By Fouad Al-Obaid, Staff Columnist

Is the world become a dangerous place to live in? It certainly feels like the first time in a very long while that the global outlook on the near and short-term future is less than bleak. Problems have increased, and the solutions are alas unavailable. After major debates, food, is finally being given the importance it should receive, with prices increasing drastically, the world seem to be set for a rude awakening.

The question that I have earlier asked seems to be getting a rather negative answer; the scarcity of land and resources is being challenged by the increased demand in many countries. Clearly, it seems that unless we start to seriously come up with tangible ways in which to deal with the growing problem, famine I am afraid will make a global comeback.

With the current context, is it even logical for countries to even dare think about transforming food that could be used for human consumption, into fuel for cars?! In a world that is in constant need of resources, one is to question the needs of the importing countries versus that of the exporting countries.

If crude oil can be used as a benchmark, the dilemma that many countries are faced with is the necessity to increase their production at a time when the current production is generating substantial surpluses that the exporting nation doesn't really need for the given fiscal year.

If the same logic is applied to food-exporting countries, then the argument would be that since we don't need to export, we will not, hence it will push the price of various food commodities towards extremes not seen in a long while. The later could start causing violence of unprecedented levels on a global scale. It is one thing to make it hard for people to drive SUV's around pointlessly, however it is a completely different thing when you have billions of rather well-off people going hungry because of a
supply problem.

Along with the issue of food, monetary interdependency is causing serious strains at the global level, the argument that has been raised in recent times is that of the power that sovereign wealth funds (Kuwait Investment Authority is one of them) have and the leverage they exercise on the global market.

Another global interdependent indices is the currently price of the USD, it is putting more than one country on course of severe problems, for the dollar has drastically weakened as opposed to other global currencies. The problem is dual for on the one hand oil-exporting countries need the stability of the dollar to secure the value of their foreign USD investments, yet they are also concerned with the inflation that the USD is causing on their local currencies vice versa other currencies.

Today more than ever the question of interdependence and globalization is on the mind of the world's leaders, despite the fact that no one can doubt the benefits of globalization, the question that many have is how are we going to be dealing with issues that cross national boundaries, issues that are taking places in foreign countries, yet are affecting our respective countries...
For thoughts and comments email to fouad@kuwaittimes.net