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Economic Growth and Sustainable Development

By Keli Taureka, Managing Director
Chevron Offshore Ltd.

University of California, Berkeley's 6th Annual Asian Leadership Conference

Singapore

ChevronTexaco has been involved in Asia since the early 1920s. With the combination of Chevron, Texaco and Caltex, our joint upstream operations in the region now account for nearly a third of our international oil production. We have refining interests in eight Asia-Pacific countries, and we have service stations and terminals under the Caltex name in Australia, Cambodia, China — including Hong Kong SAR, Malaysia, The Philippines, Singapore, Thailand and New Zealand. We have lube plants — as Caltex or in joint ventures — in China, India, Malaysia, The Philippines, Singapore, Sri Lanka, Thailand and Vietnam. We also are in the chemicals business in China and Singapore and in the power business in Korea, Singapore and Taiwan.

Of particular note is our growing involvement in the region's expanding liquefied natural gas business. We have been shipping LNG from Australia's $12 billion North West Shelf project since 1989, and recently reached a tentative agreement to develop a new $11 billion LNG project at Australia's extensive Gorgon Field. Processing facilities will be on Barrow Island, a wildlife reserve, where our oil field has been operating safely for more than 50 years, setting new world standards for both environmental and conservation controls. The LNG will be shipped to Asia and North America, creating 3,000 construction and 600 permanent jobs.

In all of our operating areas, we have very strong community development programs. We are active in health, education, environmental and economic-growth initiatives. An unusual program I was personally involved in led to a company-created community foundation in Papua New Guinea. Called CDI, or Community Development Initiative Foundation, it was designed specifically for sustainability, that is, to continue after our company left the country.

Over the past few years, in addition to our regular community engagement focus, my company has become deeply concerned about poverty and meeting basic human needs. Our chairman, speaking at the recent World Economic Forum, called poverty the defining challenge of the 21st century. Of the 6.1 billion people alive today, nearly half get by on less than two U.S. dollars a day. That's less than many of us paid for a cup of coffee this morning. Meanwhile, the world's population continues to soar, adding 3 billion people — mostly in the developing world — over the next half century.

So our defining challenge, as participants in this forum, as leaders and, simply, as human beings, is this: How do we help those 3 billion people in the next 50 years attain a standard of living at least approaching that enjoyed by the developed world?

Why should business people care about poor people? Here's my answer: Business must care — not only for ethical and moral reasons, which I think we all share, but quite frankly because it's also in our own financial interest to care. Ask yourself this: Who, more than business, needs an operating environment of peace and political stability; a healthy, educated workforce; the highest-quality local suppliers; and thriving demand for our products?

An even more important reason, of course, why business must join the fight against poverty, is that it is the right thing to do. At ChevronTexaco, we are committed to improving the quality of life wherever we operate. That means contributing to social progress, economic growth and environmental quality. And it means helping people, especially in developing countries, find ways to help themselves.

It comes down to this: How we do business is as important as the business we do.

How can business fight poverty? Business must advocate for trade reform, debt relief, good governance and other global issues that impact the poor. In Asia, for example, business needs to help strengthen investment flows to ASEAN countries, support regional integration and push for economic and judicial reforms.

Even more important, business must act, nationally and locally, by initiating projects that directly reduce poverty through economic growth. Business can stimulate small and medium enterprise, help improve health and education and sponsor training. We can encourage local entrepreneurs by underwriting micro-credit loans. We can help revitalize agriculture. These actions must include "outside the fence line" solutions that impact people and communities far beyond our immediate areas of operations.

Acting alone, no single entity or organization can fight poverty successfully. We need to tie companies, governments, communities and non-governmental organizations together in ways that leverage our efforts across nations and regions.

I've seen the power of partnership from watching the progress of the CDI Foundation in PNG and, more recently, a $50 million initiative called "The Angolan Partnership Initiative" that ChevronTexaco launched in Angola with a diverse group of development partners, including the U.N. Development Programme (UNDP) and the U.S. Department of State's U.S. Agency for International Development (USAID). As in Papua New Guinea, our goal in Angola was to create sustainable, scalable projects — in this case, projects that could help that nation rebuild after its protracted civil war.

We knew we could never tackle such an effort by ourselves. We turned to NGOs with expertise in agriculture, finance and education -- even seed multiplication and goat raising. We worked with international banks, development agencies, the government of Angola, local communities and rural villagers. One initiative, aimed at reviving the nation's small farms, will have helped nearly 900,000 Angolans by the end of 2004. That's about 8 percent of the entire population. We have similar programs, perhaps not on this scale, in Indonesia and other countries where we work.

The point is that success will come only through new partnerships and coalitions that focus our combined strengths.

I would like to end by mentioning ChevronTexaco's special partnership with U.C. Berkeley. Your university has provided us with hundreds of graduates over the years and we participate in many joint activities. Next month we will take part in the inaugural "Bridging the Divide" conference hosted by U.C. Berkeley in association with the United Nations. The conference will bring together global participants from industry, NGOs, government and academia to address ways that technology can be used to improve lives around the world, especially in developing economies. This is a partnership — right in our headquarters' backyard — that exemplifies the best ideas and ideals of partnership.

Thank you.

Updated: March 2004