Could Guyana escape the natural resource curse? Part 1

By now many Guyanese are pondering the important concept known as the natural resource curse. Government ministers, high-paid government consultants and some news outlets have been talking about it since the discovery of high-quality crude oil in Guyana’s offshore waters. As early as 1995, the concept was first observed statistically by development economists and researchers in other social sciences. These researchers calculate that on average countries with abundant natural resources such as oil, natural gas, gold, diamonds, copper, etc, tend to have a lower long-term economic growth rate compared with those without said resources. In other words, a paradox of abundance. However, the Dutch disease, one manifestation of the resource curse, was first named by the Economist magazine in 1977 and formalized theoretically by two economists in 1982. We will discuss the Dutch disease in a later column. ….