‘Resources curse’ still plagues Africa
STRIKING oil or precious minerals is supposed to signal the dawn of a new era of prosperity for any country. Not so in many corners of Africa. The coup in the Central African Republic (CAR) — with fatal consequences for SA’s military — brought home poignantly the fact that conflict is never far away from countries with mineral wealth.
It can be argued that the citizens of the CAR have not benefited much from their country’s diamonds and gold, just as those in the Niger have little to show for their uranium.
Sudan and South Sudan have already exchanged salvos over oil, and many foreign governments continue to be involved in the two countries with that resource in mind. The Democratic Republic of Congo is the prime example of what has become known as the resources curse. The vast country’s diamonds, gold, cobalt, copper, and oil have done little to lift it from poverty, but have inspired decades of armed conflict.
Countries such as Congo and the CAR typically have weak institutions and leadership. Weak institutions fuel dictatorships and political exclusion, which feeds into insecurity and national unrest.
These countries also suffer from poor economic management and high levels of unemployment.
In countries that should ordinarily have plenty, there is little to show in terms of progress.
A sense of economic exclusion, fuelled by the perception that a country’s resources are being siphoned away by its inept and corrupt leaders rather than benefiting its people is responsible for the growth of dissent, which starts off as low-key political opposition, but usually erupts into violent revolt.
Insecurity in these countries takes many forms — from assault on women and children, including rape, to vandalism. Such violence can be
Leaders concerned about welfare of the people and not self-enrichment needed for African countries to realise potential
recurrent and often mutates. That is why analysts and development experts argue that governments should be as inclusive as possible and they should do everything possible to ensure national resources are not pillaged by a small political elite.
To move away from being “potentially rich” to full exploitation of a nation’s resources, countries have to adopt clear strategies of building credible institutions that safeguard their economic interests and outline how business can be conducted above board.
Credibility of national institutions and a clear understanding of procedures and policy is important, but it is effective only if a strong leadership that is concerned about the welfare of its people, rather than self-enrichment of individual leaders, emerges.
After much struggle, countries including Nigeria and Angola, are showing that a formula can be found to turn natural resources into wealth for ordinary citizens.
Oil cash has translated into improved infrastructure — better roads, railways, schools and hospitals — and salaries for the professionals in that sector have rocketed. Serious income disparities still exist, but progress is there.
Nigeria has also made great strides because of its oil revenue.
In 2005, for instance, Nigeria successfully negotiated using its oil cash to pay off $12bn in debt, in exchange for a debt write-off of $18bn from the Paris Club.