1. The perils of development aid in resource-rich countries
- Author:
- Chiara Ravetti
- Publication Date:
- 03-2018
- Content Type:
- Research Paper
- Institution:
- Centre for International Environmental Studies, The Graduate Institute (IHEID)
- Abstract:
- The emergence of China and other new donors offering foreign assistance to mineraland land-rich African countries has spurred a renewed interest in the relationship between international aid and natural resources (Dreher and Fuchs, 2015; Dreher et al., 2018). Many low-income countries with valuable natural resources have historically received large amounts of aid from OECD donors (Fig. 1). Poor countries endowed with abundant fossil fuels or mineral reserves can have difficulties in converting their resource wealth into other forms of physical or human capital, because these subsoil assets take time to be managed, extracted and traded. Foreign aid can thus provide a complementary source of immediate liquidity for development. On the other hand, the provision of external finances has the potential to hinder political accountability, and ultimately economic development especially in countries with weak institutions.h countries
- Topic:
- Development, Humanitarian Aid, Foreign Aid, and Development Aid
- Political Geography:
- Global Focus