The Plundered Planet | Paul Collier

Summary of: The Plundered Planet: Why We Must–and How We Can–Manage Nature for Global Prosperity
By: Paul Collier

Introduction

What is crucial to the welfare of Earth’s ‘bottom billion’? In ‘The Plundered Planet: Why We Must—and How We Can—Manage Nature for Global Prosperity’, Paul Collier outlines how a nation’s natural assets can be the key to alleviating poverty and ensuring prosperity, while recognizing the delicate balance between utilization and preservation. Tackling the cultural divide between ‘romantics’ seeking to save the planet and ‘ostriches’ looking to benefit from it, Collier implores us to find a pragmatic approach that addresses the needs of vulnerable populations while respecting the finite nature of Earth’s resources.

Natural Assets: Saving the Bottom Billion

The world’s poorest nations, home to “the bottom billion,” possess valuable natural assets that can change their fortunes. Handled correctly, these resources can provide wealth for the nation. However, when nations fail to manage these natural assets effectively, “plunder” results. A sound approach to natural asset management must address the needs of the bottom billion while also considering the importance of profitability. Attempting to either save the world or exploit it for profit is not a workable solution. A pragmatic approach is necessary to benefit humanity and the planet.

Africa’s Food Insecurity and Resource Extraction

Most African nations lack the capacity for food production, and global warming only exacerbates the food insecurity situation. Corruption in resource extraction also plagues the continent, with revenue from industry not reaching the citizens. In turn, corrupt leaders fail to regulate the depletion of natural resources and foreigners with expertise in extraction often exploit the situation. This scenario has long persisted, either via colonial powers or postcolonial corporations. Eradicating global poverty and restoring environmental order have now become the most defining challenges of our era. Despite this urgency, developed nations attempt to make less-developed nations enforce environmental rules that they themselves never followed. This disconnect exacerbates distrust between rich and poor countries. Environmentalists and economists must coalesce their effort towards a common goal. Environmentalists need to recognize economic pragmatism, whereas economists need to learn ethics.

Ownership of Natural Assets

When it comes to natural assets like diamonds, oil, copper, and forests, their control matters a great deal to the country where they are located. The exploitation of these resources has been dominated by plunder in the poorest societies throughout history. The buffalo in the Western United States, for example, were almost extinct by the end of the 19th century due to overhunting. Similarly, while the Dominican Republic has rich forests, nearby Haiti has denuded hillsides. The US operates on a “finders-keepers” policy, which leads to an inefficient market where larger companies buy as much land as possible and swallow up smaller competitors. This cycle of exploitation highlights the need for humanity to use natural resources responsibly, with future generations in mind.

Dealing with Natural Resources Curse

Natural resources can be a curse rather than a blessing to some of the world’s poorer nations. Often, the government controls the sale of natural resources to outsiders, leading to corruption, violence, and inequalities. Countries with a weak or potentially corrupt government tend to suffer more from this “resource curse.” Some issues result from poor planning, such as Zambian government’s long-term loss due to the copper market that plummeted. In contrast, Norway and Malaysia managed their respective economic futures astutely with oil income. Honest governments transparently function with resource-related revenues, allowing citizens to participate in their country’s natural assets. Failure to harness natural capital creates the single most crucial obstacle for economic development and growth.

The Resource Curse

After two centuries of resource extraction to industrialization, the developed world has a disproportionately mapped out the resources, leaving the bottom billion nations with corruptible governments to extract their resources. The author connects the resource curse to the management of revenues and governance. The issue of how to capture the value for the benefit of the citizens arises, and this is where corruption happens. Cameroon, for example, derived enormous revenues from the sale of oil rights, but almost all the money went into the president’s private accounts. The fear of asset nationalization justifies firms using bribes to host governments.

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