SISAF 444 Africa Studies Seminar

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SISAF 444 Africa Studies Seminar
Winter 2007

• Conflict
• Natural Resources and Ethnicity

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Natural resources and competition for rents

• Key factors in African conflicts
• Poverty
• Dependence on natural resource exports
• Low or negative economic growth

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Natural resources and competition for rents

• Rents
• profits that are much higher than the minimum
  level needed to keep the activity going
• easy profits
• Often related to scarce resources that are unique
  cannot be replicated (e.g. mineral resources,
  talent)

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Six routes from natural resources rents to
conflict

• Political struggle for control of rents
  (rent-seeking)
• Government less dependent on people (revenue
  imperative)
• Risk of secession in mineral-rich areas
• Rents are source of rebel finance
• Appreciation of real exchange rate (Dutch
  disease)
• Resource prices are often volatile

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Wantchekon and Jensen 2004
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Wantchekon and Jensen 2004

• Countries that are NR-dependent have lower
  democracy scores
• NRs make democratic transition or consolidation
  (political liberalization) more difficult
• NR-rich countries have greater government
  consumption
• NR-rich countries have worse governments (World
  Bank governance measures)

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(No Transcript)
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Natural Resources in Africa Diamonds

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Natural Resources in Africa Oil

National Geographic
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Natural Resources in Africa Coltan

Heinz School/Carnegie Mellon University
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Natural Resources in Africa Coltan

Approximately 60 of known world coltan reserves
Heinz School/Carnegie Mellon University
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Sub-Saharan Africa, regional average
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NR-Rich Countries Nigeria
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NR-Rich Countries Equatorial Guinea
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NR-Rich Countries Chad
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NR-Rich Countries Angola
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NR-Rich Countries Republic of Congo
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NR-Rich Countries Sudan
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Challenges for natural-resource rich states

• Scrutiny
• Civil society collective action problems
• Transparency
• Accountability

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Example Chad-Cameroon pipeline

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Chad-Cameroon pipeline

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Chad-Cameroon pipeline

• Revenues due to Chad are deposited in an escrow
  account in London
• 10 of revenues placed in a Future Generations
  Fund
• Allocation of oil revenues monitored by oversight
  committee (CCRSP) that includes representatives
  from civil society, government, parliament and
  supreme court.

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Chad-Cameroon pipeline
World Bank, Chad-Cameroon Pipeline Website
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Chad-Cameroon pipeline
BBC, 13 April 2006
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Costs and Benefits of Ethnicity

• Bates on positive and negative aspects of
  kinship/ethnicity-based economies
• Ethnicity and networks, enforcement based on
  relationships and identity
• Volatility
• Economic growth and meritocracy

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Posner 2004
Lake Malawi
Zambia
Malawi
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Posner 2004

• Cultural cleavages
• How important is ethnic identity ?
• Political salience
• Mobilization

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Gangs of New York

William Boss Tweed
Tammany Hall

• New York City, 1840s to 1860s
• Irish immigrants vs. nativists
• Democratic Party machine politics and
  patronage
• New York Draft Riots

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A Simple Model of Governance