April 11: "The World Bank, Mining and Poverty Reduction"

A lecture by Dr. Scott Pegg, Dept. of Political Science

When: Monday April 11 1:00 PM

Where: IUPUI University College, lower level

No doubt about it, if you are a country "blessed" with lots of reserves of minerals, oil and gas, you aren't "blessed" at all. You're saddled with a "resource curse." Compared to countries not cursed with "extractive resources," your people are more likely to be poor; your economy will be less stable; your government is more likely to be despotic and corrupt, and you are much likelier to experience a civil war. Yikes! Remember when Administration officials such as Paul Wolfowitz confidently asserted that Iraq would be able to finance its own reconstruction (at little cost to US taxpayers)? Perhaps we would be doing the Iraqis a favor by letting the insurgents destroy the country's petroleum industry. Well, probably not, but we ought to be helping the people of Iraq (and other countries) cope with their resource curses.

The folks at the World Bank can look at numbers, they know how poor the record is for developing countries cursed by natural resources. In 2001 the World Bank commissioned an "extractive industry review" to figure out why this is so, and to make recommendations about how to improve the lives of the poor in these countries. Critics of globalization have viewed the study with skeptical optimism, the International Council of Mining and Metals with skeptical pessimism. I personally like the "extractive industry transparency initiative": the problem isn't global capitalism, it's local accountability and democracy.

Scott Pegg of IUPUI has been researching this problem for several years. Both he and the World Bank look carefully at Nigeria ... and I imagine reach different conclusion. Scott will critically evaluate the contribution that mining has made to poverty reduction, and assesses the prospects for better performance in the future. Employing the World Bank's own conceptualization of poverty as an analytical framework, the presentation demonstrates that mining has a dismal empirical track record to date in poverty reduction. While the theoretical reasons to believe that mining can contribute to poverty alleviation are perhaps sound, the reality of mineral-led development has not lived up to its rhetorical promise. Dr. Pegg will outline what preconditions must be met before mining can truly be a source of poverty alleviation.

If you like this event, you should check out the May 18 symposium on energy security and the talk by Robert Ebel of the CSIS Energy Project.