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Resource Curse Issues

Oil, gas and mining industries can generate huge revenues for companies and governments, which in turn can contribute to improving quality of life for citizens.

But instead of creating economic growth and development, extractive revenues are often linked with conflict, corruption and poverty. This phenomenon is known as the "resource curse"or the "paradox of plenty".

The terms also refer to the contradiction that countries with an abundance of natural resources tend to have worse economic growth and worse development outcomes than countries with fewer of these resources.

This happens when a country rich in natural resources begins to focus on the resources sector (particularly oil and gas or mining), and fails to develop other sectors. Research shows countries that experience the "resource curse" are often developing countries with weak political institutions and a rich natural resource base, such as Myanmar.

As well as damaging economic growth, lack of proper resource rights, policies and framework governing the fair distribution of income can foster government corruption, as well as poverty and conflict among affected communities.

Spectrum believes part of the solution to this "resource curse" lies in the transparent and accountable management of natural resource revenues, to ensure that Myanmar's natural resource wealth is shared by all of society.

  • Classic Resource Curse

    Classic Resource Curse

    In 2003 an editorial in the Financial Times expressed Natural Resource Curse issues well:

    "By past experience, you could wish nothing worse upon a developing country than an oil find...
    No longer needing to rely on taxes, they become less accountable to their people
    Oil has proven to be an addition for the rulers."

    Read more...
  • Benefit Sharing

    Benefit Sharing

    RESOURCE REVENUE SHARING IS CRITICAL TO PEACE AND SECURITY, INVESTOR CONFIDENCE AND RISK

    Read more...

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