Yesterday I took a virtual trip to check out the U.S. Institute of Peace event, Natural Resources: Plunder or Peace, via live webcast. The event featured Paul Collier, director of the Centre of African Economies at Oxford University, and Nancy Birdsall, president of the Center for Global Development, and focused primarily on natural resources beneath the ground (or subsoil assets, as they were commonly referred to during the event).
Paul Collier began his discussion with fun question to the audience. According to Collier, an average square kilometer of land in the richest countries in the world was valued to have $120,000 worth of subsoil assets. The statistics game started when he asked the audience whether they thought that the value of subsoil assets beneath an average square kilometer of African land would be more than that average. By a show of hands (save my own, as webcasts are only projected one-way), it seemed most everyone indicated a vote of “yes.” But according to Collier, everyone was wrong; the average in Africa amounts to roughly $23,000. By his assessment, this pointed to one obvious conclusion: we simply haven’t discovered the other assets to make up for the nearly $100,000 disparity. I temporarily accepted this fact and listened on.
To Collier, an increase in outside investment discovery is the first step toward increasing the value and improving management of subsoil assets. The latter steps would include:
- Rent payments to states from private corporations extracting the assets;
- Government ownership of assets and their profits;
- Investment of state profits toward nurturing future enterprises – as natural resources and their profits belong to the people, both the present and future generations;
- And investing in investing – making an environment that is open to and supports public and private investments,
Adopting these five steps, Collier expects that a state could relieve itself from corruption and impoverishment within a generation. To learn more, refer to Collier’s forthcoming book, The Plunder Planet.
Nancy Birdsall emphasized the changing nature and needs of states, and called for international bodies engaged abroad to recognize this dynamic. Birdsall went on to explain that the type of governing mechanisms and government leadership necessary to successfully implement the five link chain, including equitable distribution of profits and managing contracts, could be difficult for native political figures in a state with a history of entrenched corruption. Instead, Birdsall suggested that a foreigner be allowed to run as a single term presidential candidate in the elections of a new government. According to her, this person would be unbiased and thus the best option for governing and arbitration of internal conflicts.
Amidst their differences, both speakers made clear that the development theories of the past were simply not equipped to handle present situations. Accepting this, both agreed, is the true first step toward any hope for states besieged by corruption, poverty, and antiquated aid efforts.