Resource Curse vs. Government Curse
The "resource curse" has often been blamed for conflicts around the world, as a result of international powers who carve up a country to grab its natural goods. However, the idea that a country is automatically doomed to failure because they have a wealth of resources is disingenuous. In reality, the definition of what constitutes a resource curse is blurry, and the difference between success and failure for a resource rich country primarily comes down to the management of that country.
In order to first understand the resource curse, one must first attempt to define it. As it turns out, this is a difficult task to do, which no one does in a satisfying manner. Generally when one thinks of a resource rich countries that are cursed, they are reminded of countries that are abundant in only a single natural resource. Sierra Leone is "resource cursed" because it has diamonds. The Middle East is "resource cursed" because it is full of oil. The implication is that these countries' economies are heavily dependent on the one resource they produce, and that international attention towards those resources is causing conflict in order for whatever interest groups can get a hold of it to make a large profit.
However, is having only one single resource really considered being "resource rich?" If a country has only one major natural resource that they are heavily dependent on, it means that they are less self-sufficient and more at the mercy of foreign powers. While they may be rich in the one export which gives the country international attention, they have as much of an issue due to lack of resources as they have due to an overflow of them.
If a country is defined by their reliance on a sole natural resource in order to be "resource cursed," then there are several examples of countries breaking that curse. Ideally, a country heavily dependent on an important natural resource should expect to have many foreign clients, and as a result should roll in a good amount of export money that they can use to build other sectors of the economy. Indeed, this is the case with the United Arab Emirates. While they are ostensibly "resource cursed" with oil, it understands the West's dependency on the resource, and has utilized that Western investment in order to build their service economy. Diversifying will also have the effect of securing the economy long term, if oil were ever to crash in price, lose its demand, or be depleted as a supply. Saudi Arabia is undergoing something similar, and has been relatively peaceful. Even Sierra Leone engaged with this mindset. Since diamonds have a seemingly insatiable appeal in the West, they have brought in large sums of export money, which the country has reinvested into infrastructure or other resources that they need. As a result, conflict in the region has seemingly died down, and civil war has not yet reignited in Sierra Leone since the early 2000s. That is not to suggest that these countries do not have their own share of problems, however, they are not currently marked by major conflicts or short term instability.
On the opposite end of the spectrum, are countries in the Americas, a region with multiple natural resources, and could potentially be defined as "resource cursed." Brazil, for example, can extract plenty of timber due to the Amazon, but it is also a major exporter in items like coffee beans or sugarcane. Chile first became rich off of its copper, but it has since become known for other things such as being a fertile wine country, and it exports a large amount of organic foods such as poultry, apples, or pears. These countries can be considered "resource rich," but are that way because they have myriad types of resources in their own country, limiting their dependency on imports. Despite being resource rich, and presumably resource cursed, the Brazilian and Chilean societies are not considered to be failing. Brazil has been touted as an emerging power, especially due to its association with BRICS, and has become one of the largest economies in the world today. Chile, meanwhile, has the highest human development in all of Latin America, as well as one of the region's strongest economies and highest literacy rates. While there was an expectation of these countries to be resource cursed for being rich with desirable natural resources, these countries are relatively stable and prosperous.
By contrast, Venezuela is similarly rich in natural resources, but is highly unstable. Its murder rate is one of the highest in the world. People there are starving, eating zoo animals or making soup out of grass, and inflation is so high in the country that some video game currencies are worth more than the Venezuelan bolivar.
The common thread between the cases of a resource curse are that the government is doing a poor job at managing the resources due to corruption or poor policy making. This is the underlying problem in each case, whether a country has one natural resource or many.
In reality, countries under the resource curse are in their situation for two reasons. The lack of any resources beyond the one they are rich in has created a dependency on foreign economies in the country, and even if they were able to be autonomous from the global economy, they would require a government that can properly utilize those resources. Therefore, it is more appropriate to consider the problem to be one of poor governance, or at least label the problem a "singular resource curse."
The points you make about redefining the resource curse to instead mean a lack of governmental management or a singular resource curse are important. I really agree with your idea that much of the problem has to do with the way the government is structured and makes use of their resource. As you mention also, the problem seems to be a pattern of nations with only a singular resource. Countries with many resources are, as you mention, less reliant on the importation of other goods and the exportation of their one product. Therefore, the issue is not having an abundance of a resource, but rather having an abundance of only one resource, alongside poor government structure.
ReplyDeleteI also believe the need/want the Global North has with some of these resources is also important to mention. Take the Middle East for example. There's no doubt that there is instability in the region due to corruption, terrorist organizations, and overall poor governance. However, the United States's involvement in the region arguably is also causing issues. We have a major stake in the region due to the surplus of oil there which has caused us to meddle with an already unstable government. Therefore, the governments in the Middle East struggle to prosper due to the constant involvement of other states. The lack of governmental management was clearly seen in Sierra Leone though. The government simply wasn't strong enough to prevent the invasion of the RUF. Had the government been managed better, this invasion potentially could have been prevented, and the diamond production could have been smoother. I agree that just because a county is rich in one resource does not mean they are cursed. It's due to other factors such as more governmental management and the involvement of other nations.
ReplyDeleteI agree with your argument that much of the problems with resource curses countries stems primarily from poor governance. I also agree with your argument that diversification of resources along with stable governance within a nation is one of the surest ways for it to succeed. I would also add that places like the UAE which you mentioned, have also been particularly successful because of creating access to programs -through substantial computer programming scholarships for local children in Dubai, for example-, that create diversely skilled work forces. In order for many nations to be stable -regardless of their lack or excess of resources- they need to have a stable government leading them, and diversifying their economic output, whether that be resources and/or skills.
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