Posted on 18 Sep 2013
To meet growing global demand, natural resources are under increasing pressure. New sources have entered global markets – many of them in developing or emerging economies. Valuable resources such as oil, copper, tungsten, gold and timber can be found in many poor or fragile states, sometimes in very remote areas. Myanmar, a country that has recently embarked on an important political transition, is one of these resource-rich nations.
Over the past decade, more and more actors have recognized that natural resources, when properly managed, hold great potential to contribute to social and economic development. Mounting evidence from resource-rich countries, such as Botswana, Chile and Norway, points to the positive outcomes for local communities and countries when natural resources are developed. Elements such as equitable redistribution of revenues, strong public institutions, investment in local capacity, environmental planning and transparency measures contribute to the virtuous circle of natural resource management, bringing wealth and prosperity to citizens and companies alike.
Conversely, the risks associated with the poor management of natural resources – social unrest, corruption, graft, environmental degradation – are also well known. New research by the United Nations has revealed an important correlation between natural resource exploitation and violent civil conflict, with estimates indicating that 40% of intrastate conflicts are related to or fuelled by natural resources. More than three quarters of the states classified as “fragile or failed”2 possess extensive natural
resources that could be instrumental in creating economic opportunity.3 But if these resources are poorly managed, the potential to create new conflicts and exacerbate old ones in already challenging environments increases.
To address the relationship between natural riches and conflict, international organizations, companies and civil society are collaborating on a wide variety of important guidelines and tools that can assist countries in ensuring their resources are developed properly. A significant body of expertise pertains to the challenges and opportunities associated with natural resource exploitation, including support mechanisms that can help ensure that a country’s wealth – be it in gold, land or oil –
does not undermine its prosperity.
The debate continues, however, on what constitutes the responsible management of natural resources, and how governments, communities and companies can maximize the development potential of resources, particularly in fragile states.