Natural resources can support sustainable and inclusive growth in sub-Saharan Africa if key policy areas in the natural resource management chain are tackled and strong institutions are put in place.

In this brief, we present a framework for natural resource management. This brief can be useful for policy-makers looking to strengthen and better
diagnose the weaknesses in their national natural resource management (NRM) framework. It can also be a useful starting point for those interested in understanding the challenges related to ensuring natural resources support inclusive growth.

Despite the recent fall in commodity prices, Sub-Saharan Africa’s resource boom is continuing. During the past decade of high prices, many new discoveries were made, and the extraction of these new resources will take place over the next few years. Natural resources, through the revenues they generate, have the potential to lead to large and sustained improvements in African standards of living. Yet, too often, those opportunities are missed.

Africa has had resource booms before, but they have seldom been harnessed for sustained development. For much of its post-colonial history, natural resources have fuelled conflict and filled the pockets of political leaders more than they have benefited the population. The default option is that this history of missed opportunities will repeat itself and, for much of the region, this is a likely prospect. Harnessing resources well for the benefit of society is complicated. The steps involved are the subject of this brief.

Resource discoveries bring risks as well as opportunities. Mismanaged, they lead to unsustainable consumption sprees, as politicians struggle to meet exaggerated popular expectations. However, this need not be the case. Some developing nations have successfully managed their natural resource wealth, and have had a path of sustained growth and development as a result. In order to do so, governments of resource endowed countries will need to get the natural resource management policy chain right. They must also spend time and resources building robust institutions ensuring resource revenues support sustainable growth.

Key messages

  1. Natural resources do not need to be a curse

    The resource curse is not inevitable and, if properly managed, resourcedriven
    development is the best growth opportunity for many favourably endowed
    African countries. Indeed, most of African’s natural resources have not yet been discovered, which represents a formidable opportunity for growth.

  2. Governments need to get the natural resource management policy chain right

    The natural resource management (NRM) policy chain has five key areas: discovering, exploiting, taxing, ‘investing in investing’, and investing. All of these need to be adequately developed. Government needs to set up strong policies in each of those areas.

  3. Strong political actions are required to ensure natural resource wealth is used to support inclusive growth

    Governments should build strong institutions and rules, and ensure the citizen body supports them. Strong political actions are necessary to build and maintain the integrity of the NRM policy chain and to ensure natural resource wealth is used to support inclusive growth.