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Published on October 26, 2007

Soaring oil prices are threatening the prospects of millions of poor people across the Asia Pacific, the UN Development Programme (UNDP) said yesterday.

In a report on 'Overcoming Vulnerability to Rising Oil Prices: Options for Asia and the Pacific', the UNDP said rising oil prices were starting to put a brake on human development and in some cases, shifting it into reverse.

"Oil prices have tripled over the last four years. Today the price is approaching US$90 (Bt2,840) a barrel.

"This has meant that the Asia and Pacific region has had to pay an additional bill of almost $400 billion for imports compared to the amount spent in 2003.

"This is 20 times the annual aid flow to the region," said Hafiz Pasha, UNDP director for Asia and Pacific, at the launch of the report in Bangkok.

"It has become a real issue for an otherwise fast-growing region to absorb this staggeringly large bill," Pasha said.

The UNDP report was based on interviews with poor rural and urban households in China, India, Indonesia and Lao PDR.

It showed that between 2002 and 2005 households interviewed suffered dramatic oil-price increases - paying on average 74 per cent more for their energy needs. This included 171 percent more for cooking fuels; 120 per cent more for transportation; 67 per cent more for electricity; and 55 per cent more for lighting fuels.

This has provoked huge public outcries - and incredible hardships for the poor - who are being literally, pushed into the dark.

According to the report, millions are being forced "to climb down the energy ladder", reverting to traditional fuels that are unhealthy and inefficient.

The poor are cutting back even on bare essentials of travel and services which are increasingly beyond their reach.

However, on a bright side, Thai Energy Minister Piyasvasti Amranand said the oil price had gone up so much many parties were seriously developing renewable technologies that would be beneficial to everyone. Piyasvasti spoke at the launch of the UNDP report.

"Thailand has been providing a lot more incentive for renewable energy for very small power producers using various waste agriculture and raw materials.

"Biofuels are doing well to the extent that we will probably have enough raw material for the production of biodiesel by the end of next year, and now effort has to be spent in the production of palm oil," he said.

Still, the UNDP said the ability of the economy to endure such fluctuations was not the same as the ability of the region's poor to cope with the impact of high prices and inflation.

The Nation