The Curse of Oil in Africa

Why does everything turn to shit in Africa? Events that would seem to indicate a positive outcome in other places inevitably bring pain and suffering to Africa and a windfall to a couple of Africans (and a bunch of outsiders)

The discovery of oil in Africa has been, almost without exception, a disaster for the host countries. The reasons are partly economic, partly having to do with the lack of well-developed institutions in many African states, partly owing to colonial legacies, and partly the fault of Western oil companies all too willing to turn a blind eye to corruption while the getting is good.

This article in Salon is about "Untapped: The Scramble for Africa's Oil," by John Ghazvinian. A quote from the book:

That oil wealth could be a curse seems counterintuitive. When an oil bonanza is discovered in a struggling African country, the instinctive assumption is that it can only be a good thing; that it will result in a rapid improvement in the lives of the people; that suddenly there will be money for hospitals and vaccines and schools and roads; and, even more than that, everyone will be rich. To the contrary, however, studies suggest that real GDP and the population's standard of living nearly always decline where oil is discovered. Between 1970 and 1993, for example, countries without oil saw their economies grow four times faster than those of countries with oil.

Part of this is the legacy of colonialism. The systems that remain in Africa were designed to extract wealth and to only invest the bare minimum in infrastructure and society while enriching a very few. The system, 50 years after independence seems immutable. It devours everything -- including and especially aid -- and turns it into the monster that continues to devour the continent.