Page 431 - Arabia the Gulf and the West

428 Arabia, the Gulf and the West

estimate from the same source in September 1977 put the combined surplus of
the OPEC member states from the beginning of 1967 to the end of 1973 at
$15,000 million, and their combined surplus for the three years 1974-6 at
$140,000 million. United States government witnesses before a sub-committee
on foreign economic policy of the Senate Foreign Relations Committee in

September and October 1977 reckoned the surpluses for these same three years
at $133,000 million, with a further $45,000 million being added during 1977.
The Bank of England in April 1978 put the three-year total slightly lower, at
$128,600 million, of which $56,400 million was accumulated in 1974 (out of

revenues of $94,500 million), about $36,400 million in 1975 and $35,800
million (out of revenues of $113,000 million) in 1976. There is reason to
believe, however, that the surplus for 1976 was higher, viz. $42,000 million,
out of combined revenues of $116,600 million. The rate of growth of the
financial surpluses of OPEC’s member states varied considerably. At the end

of 1970 Persia’s foreign exchange reserves stood at $208 million; by July 1976
they were $8,426 million. Saudi Arabia in 1970 had international reserves of
$662 million; in June 1976 they were estimated at $24,700 million. Even this
large figure was a gross underestimate, for the country had received oil

revenues of $22,600 million in 1974, $25,700 million in 1975 and some $17,000
million in the first six months of 1976. The true extent of Saudi Arabia’s foreign
currency reserves, as we shall have occasion to notice later, must be in the
region of $5Q,ooo-$6o,ooo million, unless some spectacularly scandalous mis­
appropriation of the country’s finances has occurred of late years. What

Kuwait has built up in foreign exchange reserves is difficult to ascertain, for the
Kuwaitis are highly sensitive about such delicate matters. But it must be a
sizable amount, since the shaikhdom’s oil revenues rose from $1,581 million in
1970 to $10,686 million in 1974, dropped to $8,565 million in 1975 and again

reached over $10,000 million in 1976.
The foregoing figures for the OPEC financial surpluses apply almost exclu­
sively to the Middle-Eastern members of the organization, and the bulk of
these surpluses of late years has been accruing to only three countries - Saudi
Arabia, Kuwait and the United Arab Emirates (which means, in effect, Abu

Dhabi). In 1976 these three states received oil revenues of $47,000 million, or
41 per cent of the OPEC total, of which they retained as surpluses anything
between $32,000 million and $37,000 million. What they retained in 1977 1S
not known with any exactness: OPEC itself estimated the surplus for the year
at $35,000 million, while the United States Treasury put it at $45>OO° million.

Whatever the case, the three Gulf states in question were expected to accu™“
late 90 per cent of the surplus. If oil prices and rates of production conun^
their then levels (so both the OECD secretariat and the US Tr“sur’' ° „EC
in 1977), the total disposable surpluses of the Middle-East members
would reach something like $250,000 million by t98o most of it tn the

treasuries of Saudi Arabia, Kuwait, Libya and Abu Dhabi.