Natural resources make rich

Abstract

Many countries have experienced windfalls though discoveries of oil, gas, gold, diamonds, copper, or other minerals. These can constitute 80-90% of government or export revenues for many developing countries. Such foreign exchange windfalls offer a unique opportunity for resource-rich countries to improve the future of their citizens by speeding up their growth and development path. The obvious policy is to transform subsoil into aboveground wealth whether it is through human capital, health, infrastructure, or sovereign wealth. By investing in the domestic economy or saving foreign assets, consumption can be permanently increased even long after the flow of windfall revenues has ceased.