Effective States and Inclusive Development

Politics and Natural Resource Governance Across Space and Time

Politics is the primary drive of how mining, oil and gas sectors are governed and the primary problem surrounding resource extraction hinges around relationships of power and how power is exercised. This project asks the following questions:

  1. How does the nature of political settlements affect the governance of the mining and hydrocarbon sectors and the relationships between those sectors and patterns of social inclusion and exclusion?
  2. How does the circulation of ideas and the materiality of the resources in question affect this relationship?
  3. How do transnational factors (ideational, institutional and political economic) affect these relationships?

 

When the theme is mining and hydrocarbon governance, the transnational must be at least as analytically important as the national. By the same token, the localized nature of minerals and hydrocarbons means that their extraction typically enrols sub-national actors in national and international dynamics. New subnational elites emerge with substantial power to influence the course of extractive industries. The geography of resource extraction creates subnational constituencies with holding power.

Subsoil resources also produce significant rents meaning that the politics of extractive industry governance are also the politics of financing mechanisms for the explicitly political (sometimes ideological) strategies of elites.

The symbolic significance of subsoil resources means that ideas take on a potentially causal power. These include ideas of resource  nationalism – the idea that natural resources should be managed above all for the needs of the nation, and therefore be controlled by the nation state for the ‘the people’ Linked to these ideas is the notion that anti-poverty policy instruments could be directly funded by taxes on mineral and hydrocarbon sectors.

This project also takes a longue duree / long term historical approach. The distinction between competitive clientelist/dominant leader party forms of settlement seems less helpful and descriptive rather than explanatory for this project in so far as it begs the question of why more dominant or competitive modes of rule emerge. A view of the longue duree allowed us to map the rise and demise of different political actors as a means of explaining how certain period of rule emerged.

A series of transnational processes and shared global histories link resource extraction in the four countries. These include a) colonialism and post-colonialism, b) global commodity prices and domestic political and economic dynamics, c) state capitalism and neoliberalism and d) corporate strategy and new investors.

Findings:

The four countries have not moved far beyond economies that are dependent on the primary sector, and have not been very successful in developing relatively stable, durable and diverse channels of inclusion through either the labour market or public expenditure.

Through creating the reality, or the prospect, of significant rents, the very imaginary of subsoil wealth creates incentives that encourage political and economic elites to focus on capturing these rents, rather than seeking economic and political innovations that might create new value. Second, by producing highly uneven geographies of accumulation and dispossession, and creating incentives to particular regions to increase their capture of rents, the natural resource economy creates serious obstacles to the building of broad-based coalitions that share a national development imaginary. Natural resource dependent economies may tend to foster political splintering rather than alliance.

In terms of politics, it is not clear that there is any clear distinction between the implications of competitive clientelist or dominant party arrangements for how the sector has been governed. To the extent that political context has affected the specifics of extractive governance, this appears to have been more due to the ideological convictions of the parties, to the dominant settlement and to the capacity of horizontally excluded factions to use mobilization, protest and conflict as a means to force through institutional changes that attend to their demands. Many of these demands such as fiscal transfers or environmental regulation have been constituted through the mobilization of particular ideas of justice, ethnic identity and sovereignty, and reflect geographies that have been constituted through the materialities of the subsoil. The relationship between political settlements, resource extraction and inclusive development depends heavily on a combination of transnational actors and institutions, politically resonant ideas and the materiality of the resources in question.