He wants things to remain the same, even when things have changed, he gets angry, he asks, “who moved my cheese?” Then he starts to feel sorry for himself, he says everyone is out to get him, he sinks into self-pity, pride, and inertia…. The story of Africa’s giant.
I recall getting the gift of a book many years ago. The book, which is titled, “Who Moved My Cheese?” by Spencer Johnson is a masterpiece with over 28 million copies printed.
If you have not read the book, it is a book about change, or better still how people, organizations and even nations react to change. The book uses four characters to model this response to change. These four characters have a set routine to get crude oil… sorry cheese, to eat. The cheese is always at the same spot and this routine has worked for years. One day, they wake up to find their crude oil… sorry cheese, gone.
The book focuses on their reaction to this change.
When you read the book, it’s easy to wonder why hem did not react to change, why didn’t he move? However, change is the hardest thing to do, change is not natural to humans, humans are familiar with the present, they are addicted to what works. If a nation has crude oil, and sells and pays its bills, then why change?
The cheese is being moved…
Nigeria is at a crossroad; the nation is fiscally addicted to export earnings from crude oil revenues. Nigeria wakes up every day, sells crude oil, and spends. Crude oil and gas funds Nigeria’s imports which far exceed exports. Today, the cheese is being moved.
President Joe Biden has ordered US government agencies to immediately stop financing carbon-intensive fossil fuel projects overseas and prioritize international collaborations to deploy clean energy technology. The policy defines “carbon-intensive” as projects whose greenhouse gas intensity is above a threshold lifecycle value of 250 grams of carbon dioxide per kilowatt hour and includes coal, oil, or gas/petrol. Going forward, the US EXIM or any organization it funds will not fund fossil fuel projects.
At COP 26, nations including, the US, UK, Netherlands, Switzerland, Belgium, Canada, Denmark, France, Germany, Italy, Spain and Sweden pledged to “end new direct public support for the international unabated fossil fuel energy sector by the end of 2022. Not just nations, development agencies also, the European Investment Bank (EIB), the French Agence Française de Développement (AFD), the Dutch Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO), even the Vatican.
What about the banks? Not too far behind! Morgan Stanley, Wells Fargo, Goldman Sachs JP Morgan, and Bank of America all signed off to stop funding fossil fuel drilling in the artic. Do you see where I am going with this?
Businesses fail because they run out of cash. The plan is to take away the cash from fossil fuels, then it dies.
The Vice President of Nigeria, Prof Yemi Osinbajo sees the cheese moving away. While giving a keynote speech at the World Liquefied Petroleum Gas Association (WLPGA) week-long forum in Dubai, he said: “It is worrying that a growing number of wealthy nations have banned or restricted public investment in fossil fuels, including natural gas.”
He continued, “Such policies often do not distinguish between different kinds of fossil fuels, nor do they consider the vital role some of these fuels play in powering the growth of developing economies, especially in sub-Saharan Africa.”
Prof Osinbajo is correct, the West is seeking a good thing in terms of a clean earth, but the path to a clean earth is a loss of jobs and economic growth in the poorer developing world where renewables are more expensive.
This brings us back to who moved our cheese. I watched a video of a session of the Nigerian Senate, from 2019. Two senators were debating. One Senator argued for electric cars, he has a Tesla and charges it via solar. The other Senator is the one that interests me, he argued that Nigeria should “frustrate” the adoption of electric cars because Nigeria sells crude oil and gas, thus electric cars will hurt the export sales of Nigerian oil and gas.
That Senator is Hem. There are many Nigerians like him. Right before their eyes, Shell has divested from onshore oil in Nigeria, banks and nations are publicly pledging not to invest in oil and gas, yet they are focused on oil and gas, they are asking who moved their crude oil.
Like Hem, the questioning is on the rationale for the West to stop fossil fuels funding, you hear the pleading and self-pity as well. To be clear, I agree, should the West decide to move too quickly on renewables, it will cause massive social upheaval, what will Saudi Arabia do?
So, let us look at Saudi Arabia.
In the book, Who Moved My Cheese, there is another mouse called Sniff who sniffs out change and acts.
Saudi Arabia is a swing producer of crude oil, they produce a lot. Yet Saudi Arabia is divesting away from crude oil into renewables. The Saudi Sovereign Wealth Fund, the PIF, invested $1.3 billion in Lucid, an electric automaker three years ago. Today, that holding is worth about $47 billion, yes, forty-seven billion USD. The Saudis also own stakes in Tesla and hold stakes in Uber. Saudi Arabia’s oil Minister said:
“In Saudi Arabia, we recognize that eventually, one of these days, we are not going to need fossil fuels. I don’t know when, in 2040, 2050 or thereafter.”
He then continued, “The kingdom planned to become a global power in solar and wind energy and could start exporting electricity instead of fossil fuels in coming years.”
So, let’s back up.
Saudi Arabia who has more crude oil than Nigeria recognizes that their cheese has been moved, then they take action to find new cheese, they are not seeking to frustrate electric cars to export more crude oil, no, they are investing in electric cars.
Nigeria is investing in the Dangote Refinery, it has approved $2.7 billion for this, the bulk of the cash to invest will be borrowed. Nigeria is not ready to let go of her cheese.
Two oil and gas producing nations, same pressures, yet two very different responses. Saudi Arabia has found new cheese, Nigeria is still wondering who moved her cheese.
Change is hard. But l end with this quote from the book, “Adapt to Change Quickly: The Quicker You Let Go of Old Cheese, The Sooner You Can Enjoy New Cheese.”
This is classic, I hope that policy makers and politicians understand this.
Brilliant
The point cannot be more aptly stated.
Unfortunately we have leaders who are looking backwards while at the steering wheel!
I cannot imagine what is about to happen.