THE HISTORY OF THE OPEC FUND
Venturing into New Frontiers –
W hen Suleiman J. Al-Herbish became Director-General of the OPEC Fund in November 2003, the institution had only recently marked the approval of its 1000th loan: It was a US$6.62 million financing of a vocational training project in Namibia, the first operation in the southern African country. The chairman of the Governing Board Saleh A. Al-Omair spoke of a “milestone on the path of the [OPEC] Fund’s growth.” The world, however, was in turmoil. In retaliation for the 9/11 terrorist attacks in New York City in September 2001, the United States led a coalition of allies to invade Afghanistan. This was followed by the war in Iraq in 2003, further destabilizing an already highly volatile region and causing massive destruction and huge loss of human life. During the decade 2000-2009, which came to be known as the “Noughties”, the world economy registered robust growth despite shocks like the wars in the Middle East and the dot.com crisis at the turn of the millennium. Investors’ glee, however, was short-lived and the world economy crashed into a financial and economic emergency triggered by the subprime mortgage crisis in the USA starting in 2007. Financial markets would eventually recover but even by the end of 2011, stocks were still only back to their late-1990s levels. This era is infamous as a “lost” decade for long- term investors. Not always is greed good. Culturally, however, the Noughties are remembered more fondly: The world did not end on January 1, 2000 because of the Y2K “millennium bug”, Apple opened the iTunes Store in 2003, Facebook was founded in 2004, YouTube followed in 2005, Twitter in 2006 and the iPhone was launched in 2007, making Apple one of the world’s most valuable companies with a current market capitalization of US$4 trillion, marking the shift of economic power toward the technology industry (“Big Tech”).
In the developing world and emerging markets, the 2000s saw the rise of China and India driven by strong growth and the push for convergence with advanced economies. In 2010, China reported a GDP of US$5.8 trillion, leapfrogging Japan on US$5.4 trillion. Strong growth in large parts of Asia was mirrored in Africa where an average annual increase of 5 percent was hailed as “Africa Rising”, driven by soaring commodity prices, strong foreign direct investment and the expansion of the service sector. The strong performance at the beginning of the decade allowed many African countries to weather the 2008/09 financial crisis better than scores of Western countries. The decade also saw an increased frequency of natural disasters. The new OPEC Fund leadership reacted swiftly with grant support when a tsunami shook the Indian Ocean in 2004 and a catastrophic earthquake hit Pakistan the following year. Earlier, the OPEC Fund had also provided an emergency grant to Austria in the wake of heavy flooding in 2002, following a request by Federal President Thomas Klestil.
Suleiman J. Al-Herbish
Suleiman Jasir Al-Herbish was born in Saudi Arabia in 1942 and holds a BA in Economics and Political Science from the University of Cairo and an MA in Economics from Trinity University, Texas. Before becoming the third Director-General of the OPEC Fund in November 2003, he had served as Governor of Saudi Arabia at the OPEC Fund. Under his leadership (2003- 2018) the OPEC Fund substantially expanded its operations and became a leading advocate for combatting “energy poverty.” Operations increased and with numerous public engagements he raised the profile of the institution. At the time of his retirement, the OPEC Fund’s portfolio had grown to US$20 billion.
The OPEC Fund and Austria
Vienna, the capital of Austria, has been the host city of the OPEC Fund since the establishment of the institution in 1976. Following the signing of the Headquarters Agreement with the Austrian government in April 1981 and the purchase of the Palais Erzherzog Wilhelm, the OPEC Fund moved into its new premises. The location along Vienna’s most famous boulevard, the Ringstrasse, allowed for the swift and seamless integration in the host city and country. The OPEC Fund conducts its business exclusively from its Vienna Headquarters. In response to a
With the launch of
Facebook, the iPhone, Twitter and YouTube, the Noughties marked a shift of economic power toward “Big Tech”.
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