Fossil Fuel Subsidies & Sustainable Development

In September 2013 Sudan introduced the third and most dramatic in a series of fuel subsidy cuts, raising prices of petrol, diesel and liquefied petroleum gas (LPG) by 65 to 75 per cent each. This came in a context of high economic pressure, following the loss of oil revenue from South Sudan after July 2011. That resulted in significant structural imbalances in the fiscal and current accounts, sending the black market exchange rate out of control and requiring the Central Bank to print money to finance excessive government spending.

This briefing note outlines the relationship between fossil-fuel subsidy reform and Indonesia's many small and medium-sized enterprises (SMEs).

Fossil-fuel subsidies are significant drain on public finances. They are also bad for the environment, while benefitting higher income consumers more than poorer ones. This comic book provides an accessible and fun introduction to fossil-fuel subsidies in India. It details how the subsidies work, their impacts on people and the economy, and what the Indian government is doing to change these policies.

The irony of water scarcity on a planet 70% covered by ocean does make us gaze longingly at the seas as the ultimate answer. The public, politicians and water authorities continue to hope that cost-effective and environmentally friendly desalination - the removal of salt from seawater to make it drinkable - will come to the rescue of water-scarce regions.

Norman Myers, an environmental scientist, is the author of the book Perverse Subsidies: Tax $s Undercutting our Economies and Environments Alike. He is currently completing a new book called How Institutions Block Our Road to Sustainability. He also serves as a member of the High-Level Advisory Group of the Global Subsidies Initiative. The GSI reached Mr. Myers at his home in Oxford, England.

Many countries in the developing world are concerned about the impact of high oil prices on their economic growth. This is the case not only in Asia, but also in Latin America, where subsidies are often used to lower the consumer price of petroleum products, at heavy cost to public budgets.

A briefing note by the International Institute for Environment and Development (IIED) (International trade in biofuels: Good for development? And good for environment?) comments that barriers to trade in biofuels are blocking the possible benefits of this alternative fuel.