Management Seminars: Evi Neophytou and Andreas Tornaritis
1.01 Howard House
Title: Regional cooperation to enhance FDI in the development of offshore resources
Geopolitical aspirations and regional maritime claims could, if not resolved or managed properly, disincentivize or even hinder FDI in the exploration and development of offshore resources. For instance, due to maritime disputes between Vietnam and China, BP has abandoned its plans for exploration in Vietnam, where Repsol has stopped its operations.
Country-specific regulatory limitations and geopolitical challenges do not allow countries in the Eastern Mediterranean to reach their full potential. The countries of the Eastern Mediterranean can have a better standing in the global energy markets and be more attractive destinations of FDI with enhanced bargaining power if they arrive on the international energy scene as a region. To achieve that, the States of the Eastern Mediterranean should emerge to the markets as a region with a predictable business, regulatory and political environment. The differences in the regulatory regimes and the political challenges in the Eastern Mediterranean are not greater than their common interest to attract FDI.
In our paper we suggest the establishment of a regional Scientific Forum, that would encourage regional cooperation through interactions and recommendations, could lower risks and enhance FDI in the exploration and development of offshore resources. The distinctive feature of this Forum is that it will be a State-Market hybrid comprised of the countries and the IOCs operating in the region.
During the presentation, we will present the idea proposed by our paper. In particular, we will discuss why this Forum is needed, past practices of the Eastern Mediterranean countries which allow the conclusion that they would be willing to consider this proposal, and the proposed modus operandi of this Forum. We will also touch upon the recent developments in the region such as the agreement for the establishment of a Regional Secretariat for the purpose of regional energy cooperation, and how this is relevant to our proposal.
The paper has been downloaded over 2300 times, just a month after publication.
Andreas Tornaritis and Evi Neophytou, ‘Regional cooperation to enhance FDI in the development of offshore resources,’ Columbia FDI Perspectives, No. 238, November 5, 2018.