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This post, co-authored with Alan Gelb, was originally published in Financial Times: This is Africa
On November 28 Anadarko Petroleum doubled the estimate of its massive Mozambique gas discovery. If this proves correct, Mozambique will become a major gas exporter and can expect a hefty windfall.
Mozambique is not alone. Per square mile, proven sub-soil assets in poor countries — notably in Africa — are only about one quarter of those in better-explored, rich countries. Not surprisingly, high prices and new technologies are driving new oil, gas, and mineral discoveries across the developing world. Billions of dollars will be pumped into countries like Uganda, Liberia, Papua New Guinea, Mongolia and Bolivia. While this should be good news, it also raises concerns.
That’s the question in Alain Vicky’s piece this morning in Le Monde Diplomatique (gated). Vicky warns that oil discoveries in Uganda’s Bunyoro region threaten to heighten simmering tensions between the local communities whose ground is being drilled and the central government which is pocketing the cash. Unmet expectations and popular frustration with politicians could unleash violence and do raise concerns that Uganda might be heading for a rough patch.
This is a joint post with Stephanie Majerowicz
The World Bank’s Shanta Devarajan and Marcelo Giugale in yesterday’s Guardian Poverty Matters blog write:
Except for Botswana, the track record of Africa's mineral and hydrocarbon exporters is sobering. While Africa's central banks are today better equipped to deal with currency appreciation, and its civil society more alert to environmental hazards, the institutions that control graft are not strong. They must be improved. However, this will take time. Is there a shortcut to better accountability in the management of natural resources? Yes, there is: direct transfers of resource dividends to citizens.
It is thrilling to watch the overthrow of despots and dynasties as people power erupts across the Arab world. But the headiness of the moment can only lead to durable political change and meaningful economic progress if the new governments that emerge find a better way to handle oil revenue and other easy money (rents, in econo-speak) that have corrupted the outgoing regimes.
This posting is joint with Julia Barmeier
According to its website, the United Nations Educational, Scientific and Cultural Organization (UNESCO) has stopped accepting nominations for its UNESCO-Obiang Nguema Mbasogo International Prize for Research in the Life Sciences. But we are guessing that the applicant pool remains quite small. Frankly, who would want his or her name affiliated with one of Africa’s worst dictators? Besides UNESCO, that is.