Oil, oil everywhere…
In just the last two days, two articles have pointed to growing pressure for greater state control of energy resources. In Brazil, the state-owned oil company Petrobras (subscription required) has been pressuring the country’s Congress to change the rules of the game to its benefit. Currently, foreign oil companies bid in auctions for exploration rights, paying a combination of an upfront fee and royalties on any discoveries. However, a huge discovery last year by Petrobras has upped the stakes.
Global trade could increase by trillions of dollars if transactions costs in developing countries are reduced to OECD levels. But what’s the most effective ways to achieve such reductions?