STRATEGIC CONSIDERATIONS FOR RESOURCE ENDOWED COUNTRIES TO AVERT THE RESOURCE CURSE PHENOMENON: WITH A CASE STUDY OF THE DEMOCRATIC REPUBLIC OF CONGO
Open Access
- Author:
- Masangu, Joyce Ndala
- Graduate Program:
- Energy and Mineral Engineering
- Degree:
- Master of Science
- Document Type:
- Master Thesis
- Date of Defense:
- March 29, 2018
- Committee Members:
- Dr.Kohler, Thesis Advisor/Co-Advisor
- Keywords:
- resource curse
Democratic Republic of Congo
mining
mineral resources
resource-rich
artisanal mining
guidance
strategic considerations
mining sector
ministry of mines
ASM
political will
good governance
economic discipline
development
sustainability
economic growth
poverty reduction
poverty alleviation
Africa Mining Vision
Dutch Disease - Abstract:
- The discovery of a new valuable mineral deposit in a country does not always lead to economic growth or development in a nation. There are many examples of countries with abundant resources whose economic and social situations have not improved, and in many cases have worsened, because of their bountiful mineral resources. The “resource curse” describes the paradoxical fact that countries with an abundance of natural resources, specifically non-renewable resources like minerals and fuels, tend to have less economic growth and worse development outcomes than countries with fewer natural resources. The degree of the phenomenon’s effects varies from country to country. There are many causes and symptoms of the resource curse evident in the economics literature, but there is no clear guidance on how a country can avert its resource curse. This study aims to identify the factors that hinder resource-rich countries’ attempts to achieve sustainable development and economic growth. The relative importance of the factors is assessed, and a seven-point strategy is formulated to help resource-rich countries reduce the adverse effects of the resource curse. The study uses a qualitative-phenomenological methodology. Fifteen resource-rich countries, which either faced the phenomenon in the past, are still facing it, or never experienced it, were selected for the study population. Subsequently, the study focuses primarily on the Democratic Republic of Congo (DRC), one of the wealthiest in terms of resource endowment, but also the most affected by the resource curse within the study population. A comprehensive set of variables were selected to compare the DRC’s mining sector to that of Australia, Botswana, Brazil, Canada, Chile, Ghana, India, Ivory Coast, Namibia, Peru, South Africa, United States of America, Zambia, and Zimbabwe. This study finds that there are seven specific factors that enable a country to reduce adverse economic and social outcomes as a result of its vast mineral resources. The seven factors are the following: political will, competitive legislation and the enforcement thereof, strong institutions with targeted goals, economic discipline to achieve visions and goals, the diversification of the economy, the application of good governance practices, and motivation to learn from other countries’ experiences. By focusing on these determinants, mineral-rich countries can mitigate the effects of the resource curse, and as a result, they can experience the economic growth and sustainable development that should follow from their mineral assets.