Introduction
Today’s column wraps up my discussion of the Resource Curse. This is the second of the top ten development challenges, which I have said the Government of Guyana’s (GoG) spending of fiscal take from its oil wealth has to navigate in the coming years. Afterwards, I shall turn to consider the Governance Curse. This has been placed third on the list of challenges. Today’s wrap-up essentially identifies, briefly, four issues that were not satisfactorily addressed in last week’s column.
Resource Curse (Cont’d)
The first of these issues is that in recent years several analysts have presented the Resource Curse under a very broad rubric. This rubric covers several of my listed challenges as its subsets. For example, the Dutch Disease, which has been already addressed. I do not, however, share this position, simply because it runs the risk of creating for one challenge an amorphous jumble of complex considerations.
A second issue is that research has identified distinct drivers of the Resource Curse. These include the propensity in affected countries towards 1) weakened institutions; 2) a deterioration in the standards of governance; and, 3) the consolidation of “rent seeking behaviour” (discussed in last week’s column). These drivers reflect those historical forces that typically encourage rent seeking behaviour in “poor petroleum abundant states.” In Guyana, such forces include: its small size; its colonial evolution; its external dependence (openness); and, its low levels of income, wealth and spending power (without oil and gas revenues).