Colombia needs oil dividends, royalties and taxes, factors that weigh on the country’s economy.
In the midst of the growing debate on oil dependence and its environmental impact, a question arises: is oil an essential resource for our economic development and lifestyle? Some proposals have emerged seeking to reduce the indiscriminate consumption of petroleum products.
However, it is and will continue to be a key player in the industry, economy and development, in fact Ecopetrol’s income “for 2022 reached 33.4 billion, representing double the previous year and around 10% of all sales in the productive sector in Colombia, then if the stigmatizing discourse against the oil industry continues, it would be believed that it is due to the fact that society is willing to change its consumption models and that there is already an advanced replacement of inputs, etc., said Mario Zamora , leader of the oil sector in Colombia.
In this sense, thinking about stopping exploring and extracting oil impacts the pocket of Colombians and everyone’s lives, for example, in the price of fuels, tax increases and even deficits in raw materials in most industries. , even having an impact on employment and the family basket. Likewise, not exploring or slowing down the exploration rate can lead the country to depend on imports almost 100%.
The annual average production, between April 2022 and April 2023, was 771,278 barrels of oil per day, representing an increase of 3.38% compared to what was registered the previous year, according to the National Hydrocarbons Agency (ANH).
Betting on the energy transition in the short term, not only means thinking about whether you are willing to give up the privileges that oil derivatives offer today, but also generating strategies that gradually and groundedly allow that objective.
In addition, at the same time to stabilize, strengthen, curb uncertainty and increase the confidence of Foreign Direct Investment (FDI) that only last year had an increase of 57.7% and of the total of this, 72% corresponded to mining and hydrocarbons.
Oil has been the backbone of industrial and technological growth, propelling Colombian society into the modern era. From transportation to industry and manufacturing, oil has been the primary source of energy and raw material for a wide range of sectors.
Consequently, this industry marks the world economy, provides energy to homes and has been the basis for the manufacture of essential products of daily life, such as medicines, clothing, footwear, fertilizers, cell phones, all kinds of technology, among others. In addition, being an important source of employment and opportunities for thousands of people around the world.
According to figures from the National Hydrocarbons Agency (ANH), as of May 2023 there are four registered A3, A2 and A1 exploratory wells, a much lower figure than the same period in May 2022 that registered nine. It is estimated that in the coming years, due to the problems that have been occurring with the communities, the lack of incentives for investment, the increase in taxes, the elimination of the payment of rent with royalties, turning this item into an expense rather than a an investment. It would generate a decrease in income due to the entry of resources from the sale of hydrocarbons.
In addition, the decrease in the subsidies that are being developed would cause taxes to increase in the future. And, most importantly, Colombia needs oil dividends, royalties and taxes. Precisely, factors that weigh on the country’s economy.
To that extent, the search for energy alternatives and the development of renewable sources are steps in which progress must be made, although it is true that humanity faces significant challenges to change its consumption patterns, the key lies in greater awareness and education that promote responsible use and have the potential to change mindsets and encourage a more responsible approach to natural resources.