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Asia's Energy Security and the Middle East

Strong growth and rising energy needs are increasing Asia’s reliance on energy supplies from the troubled Middle East, making energy security an urgent issue. Existing policies, based on orthodox demand-based economics and an overly narrow concept of energy are unlikely to solve the problem. This paper presents a new framework for thinking about energy and economic growth based on the broad concept of energy used in the natural sciences. This framework views economic activity as transfers of both current solar energy and vintage solar energy, stored in the form of natural resources, human capital, physical capital, and technology, driven by the uncompromising laws of thermodynamics. It points toward unconventional solutions to the energy security problem including investing in communication networks, information technology, and education; agricultural research to increase the efficiency plant energy capture and improve the productivity of farm workers and, thereby, release manpower for the energy-efficient services sector; and legal, regulatory, and exchange rate policies to provide a stable environment to attract high tech capital from global investors.