Demand corrosion

摘要

Falling oil prices are giving reform-minded governments in emerging economies a timely opportunity to try to phase out energy subsidies. Removal may prevent consumers in those countries from enjoying the relief of lower international oil prices, but it will boost energy efficiency and remove an unnecessary drain on government budgets. The transition is already under way in key Asia-Pacific economies. And some Opec producers are even toying with their own subsidy cuts. But the region most exposed to the distortions of energy subsidies - the Middle East and north Africa (Mena) - is the one lagging furthest behind, and paying the highest economic price because of it.