inefficient that the return on investment can be modest. The IMF
refers to this as ‘limits on absorptive capacity’. While this is correct,
the inference that savings should therefore be held abroad is not:
the right inference is that the capacity to invest must be built. I term
this link in the decision chain ‘investing-in-investing’ and it is likely
to prove the most difficult.
The decision chain is a weakest link problem – if any link fails the
result is plunder in one form or the other. What is more, the entire
link has to hold again and again for at least a generation, which is
what it will take to lift an impoverished society to prosperity.
The need for a critical mass of informed opinion
There is no substitute for a critical mass of informed opinion,
society-by-society. The issues are sometimes about transparency
and accountability. Here, the Extractive Industries Transparency Initiative
is helping to achieve change, insisting that citizens have a right to
know what revenues are flowing in, and how extraction contracts
are designed. The EITI was the right place in the decision chain to
start, and there are still important battles to be won. But it would be
the wrong place to stop. All along the decision chain coalitions of
appropriate stakeholders need to be built to help support decisions
that promote the ethical exploitation of natural assets. Currently,
the least energy is in the downstream issues – how money is spent –
yet these are the links in the chain where typically most goes wrong.
In order to build a critical mass of informed opinion, the costs of
information must be lowered and citizens must be able to assets the
decisions taken in their own society against realistic benchmarks.
A new effort to provide societies with information on the decision
chain is the website http://www.naturalresourcecharter.org/. The Natural
Resource Charter is a civil society initiative completely independent
of any official institution. It is overseen by Ernesto Zedillo and Mo
Ibrahim, and has technical support from a team including the
Nobel Laureate Michael Spence. Pitched for several different levels
- citizens, journalists, and practitioners – the Charter aims to lay out
in clear terms the entire decision chain. It is endorsed by the
African Development Bank and promoted on the EITI website.
Bringing it to the attention of citizens in resource-rich poor