Tag children

Government Revenues – the only real benefit from the extractive sector?

Advocates of natural resource extraction in developing countries commonly list five benefits: economic growth, employment, infrastructure, community investments, and government revenue.

Our conclusion is unambiguous: the overwhelming benefit is government revenues. Here’s a roundup of why…

Natural resources – a curse, a blessing, or a “preventable disease”

According to conventional wisdom, a rich endowment of natural resources represents a curse, not a blessing, as resources are said to do more harm than good. Findings show that the resource curse may be overstated in the case of Mozambique.

Firstly, natural resource dependence has been linked to increased incidence of civil war in places like Angola, Sierra Leone and the Democratic Republic of Congo.

In the case of Mozambique, natural resources were not a factor in the civil war. A distinction can be drawn between resources that are “lootable” – those that can be exploited with out sophisticated technology – and those that require industrialized production. While there is artisanal production in Mozambique, the majority of the mineral wealth can only be exploited with industrial technology.

Taxes for good?

I spend a lot of time thinking about the revenues from the extractive industry and the wait predicted by some experts as to when the monies will actually be visible in the national treasury.  My concern is that children don’t have the luxury of waiting a decade or two for coal and natural gas revenues to flow in and out of the national coffers and eventually into the pockets of their parents – through decent employment, their teachers – through quality education and their community health clinic – through basic vaccines and other core services.  Children need their rights fulfilled now.  Children are stunted due to inadequate nutrition and care practices today and will not have the capacity to grow into the leaders of tomorrow if they are physically and cognitively compromised in their first two years of life.  Investing in social protection systems could make the difference to the most vulnerable and give them a fighting chance for their futures.

If I had a million dollars…

Many of us could spend a few moments daydreaming about winning the lottery or finding a pot of gold at the end of a rainbow.  But in resource rich countries like Mozambique, the discovery of coal and natural gas, among other mineral resources, can place a Government within a tempest of rapidly evolving circumstances where decisions with regard to the legal, policy and fiscal regimes can mean the difference between sustainable development for all or battling the resource curse for decades to come.