Why Do Some African Countries Negotiate Unfair Natural Resource Contracts?

Abstract

This chapter revisits the literature on resource curse, or the phenomenon whereby natural resource abundance yields poor development outcomes, and the role of unfair government contracts in underwriting poverty in Africa. The chapter takes issues with governance approaches and interventions biased toward transparency on rent appropriation and argues that attention be paid to the bargaining process, the negotiation stage where abuse of authority and corruption often occur. Thus, within the “law-politics-business” matrix it is not the legality of contractual agreements that is put into question, but their substantial value for sustainable development.