According to the World Energy Agency, 79.4% of the world’s proven oil reserves are located in OPEC members, of which the majority of OPEC’s oil reserves are located in the Middle East, accounting for 64.5% of its total reserves. Meanwhile, economies of oil-producing countries in the Middle East are extremely dependent on their oil revenues, which makes them an example of a new “rentier economy” in terms of economic development. Therefore, these countries are also known as “Rentier States”.
On the afternoon of October 13th, 2020, Prof. Yang Guang, Director of Institute of International and Area Studies, Tsinghua University (IIAS-THU) and President of China Middle East Society, delivered a themed lecture entitled “An Effort in Shifting Oil Dependency: the Exploration of ‘Rentier States’ for Development” in Auditorium 205 of the Central Main Building of Tsinghua University, which provided IIAS faculty and students with an in-depth interpretation of the history and economic model of Rentier States in the Middle East. Through this event, Prof. Yang demonstrated a paradigm for interdisciplinary area studies to the audience by combining macro theory with micro data and political science with economics. This lecture is also the first in a series of lectures on “The Diversity of the Middle East” at IIAS. Wang Tingyi, Research Assistant Professor at IIAS, presided over the event.
During the lecture
Prof. Yang started with the history and unique attributes of the oil economy and the Rentier States in the Middle East in three aspects, including the history and formation of oil exploration in the Middle East and the particularity of its oil and gas fields; the Middle East countries’ struggle to recover their oil rights and interests from European and American oil companies; and the generality and particularity of economic development in these Rentier States. He focused on the impact of the particularity of oil fields in the Middle East on its oil economy.
Later, Prof. Yang reviewed the economic “diversification strategies” launched by these countries, for instance, Saudi Arabia’s Vision 2030. He pointed out that the economic diversification reform of oil-producing countries in the Middle East has not fundamentally overthrown their single economic systems. Meanwhile, he revealed that the “resource curse” is the biggest shackle that hinders the economic transformation and development of these countries.
Finally, Prof. Yang highlighted the urgency and difficulty of the reforms in the Rentier States in the Middle East. He commented that with the deterioration of the external economic environment, the oil-producing countries in the Middle East urgently call for reforms in order to survive and develop, but due to the constraints of the traditional political system and social order, it is challenging to successfully implement these reforms. According to Prof. Yang, “It is not easy to depend on oil, but it is even harder to stay away from oil!”
During the Q&A session, Prof. Yang further explored the relationship between the monarchy and economic development in the Middle East in response to the questions raised by the students. Moreover, he compared the oil economy in the Middle East with that in other regions, providing new ideas and insights to IIAS participants.
Prof. Yang Guang is Director of Institute of International and Area Studies, Tsinghua University and President of China Middle East Society. Currently, he serves as Supervisor of Doctorate Candidates majoring in world economy in the Graduate School of Chinese Academy of Social Sciences, and concurrently holds a number of leadership positions in several national academic associations in China. Prof. Yang’s research interest focuses on economic development, international energy security and China’s relations with Middle East and African countries.
By: Zhang Yuan
Photography: Wang Tingyi
