Natural Resources Curse for Rich Nations

Natural Resources Curse for Rich Nations

Introduction

There are natural resources a blessing for countries? That would have us believe, but experience shows that this is generally not the case. Most resource-rich countries are characterized by political instability and lack of development. In some cases foreign interests intermingle with internal factions to produce civil wars. In other cases are dominant families who monopolize power and wealth. In the best political system is prey to populist democracies that deliver perks and destroy the cultural values ??necessary for development. Is it possible to escape the curse of natural resources?

Discussion

The nature of the problem

In a recent article Thomas Friedman argues that the most lethal weapon that has the United States against Iran is to reduce their own energy consumption and consequently the world oil price. If this happens, Iran should eliminate u $ s 25,000 million dollars politically popular subsidies that support the regime, condemning the unpopularity and eventual fall. "There is only one sillier thing to be addicted to oil consumption country (referring to the U.S.) and that is to be addicted to the sale of oil country. Because being addicted to oil sales can do really stupid country "says Friedman.

Friedman's argument is based on the theory of "the curse of natural resources". Global experience is overwhelming and shows that the poor but with significant income from their natural resources, developed countries do not adhere to genuine democracies. The main reason is that these countries do not encourage the culture of work; it is more attractive to participate in the bid, and live, that easy wealth;

In some cases that bid, which involved the interests of multinational corporations, gives rise to civil or regional wars. The difficult solution of the Iraqi problem today has as its background the fact that all the oil is in Shiite and Kurdish areas and nothing in Sunni areas. The civil war in Iraq is a struggle fueled by religious factions struggle for the distribution of oil revenues.

When the country is poor but uniform and escapes these divisions, the most likely outcome is that dictators and feudal families bear the full power. Whoever comes to power will have enough resources to stay on it and therefore it is normal to find that these countries are run by dictators and royal families. This is the case of Saudi Arabia and other oil producing countries.

If the policy evolves democratic forms, the tendency is to populism, that is, to split the rent of natural resources in the form of perks. Venezuela is the best current example.

The curse of natural resources is then translated, in the worst cases, regional armed conflicts or civil wars. In more normal cases, generates totalitarianism and control of wealth by a few. In the best case, generates populist democracies that deliver essential perks and alienate the development cultural factors.

Natural Resources and Economy

Gold, diamonds, oil and coltan remains the "crown jewels" of a world economy that says start to stock more ...