UNTAPPED
Lee interviewed John , the author of where he talks about... what else, oil in Africa. Hat tip to My post about these book is still sitting somewhere in my draft folder. I hope this will suffice. That’s a fair point, you’re right I do kind of go on about that. The industry gets excited because we’re talking about offshore deep water and ultra-deep water oil. You’re talking about thousands of feet below sea level; oil thats a
good hundred miles offshore sometimes. The reason they like that, if you’re
familiar with Nigeria, when you drill offshore you don’t have to deal with angry
villagers and militants and so forth disrupting what you’re doing. So, the
industry likes that. However, as I try to argue, this is a little bit of a deceptive story. What does happen even in the offshore situation is you get all kinds of economic and political problems on a macro scale. You have the Dutch Disease, which economists like to talk about, where the country’s currency appreciates and it becomes impossible to diversify the economy. You also have the rentier trap, which is basically where the country becomes a sort of landlord, gets lazy and sits there collecting oil money.
If you have a poor struggling African country with very little capacity and very immature institutions, and you throw very large amounts of dollars into that country
overnight…it’s going to create problems. It’s not going to make things better.
It’s actually not rocket science. If you have a poor struggling African country with very little capacity and very immature institutions, and you throw very large amounts of dollars into that country overnight…it’s going to create
problems. It’s not going to make things better. That’s the ‘curse of oil‘ that
people talk about.
