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Natural Resources Extraction in the Developing World

Paradoxically, some countries rich in natural resources—those that receive more than 25 percent of their government revenues from natural resources extraction—actually tend to have high and growing levels of poverty, extreme income inequalities, greater risk of conflict, and high levels of corruption.

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Too often, government revenues from resource extraction are simply not making their way into spending for basic social services such as health, nutrition and education. Worse yet, profits from extractives too often fuel terrible violence, as we have seen in the Democratic Republic of Congo and Sudan.

Poor governance and corruption in resource-rich developing countries are a serious problem, but developed country governments and private enterprise are part of the problem as well.

CRS Policy Position

CRS is committed to helping ensure that government revenues from extractive industries in the developing world improve the lives of poor people.

CRS believes that this can be achieved by:

  • Requiring companies to make public what they pay to governments to extract natural resources.
  • Increasing national-level budget allocation to critical services such as health and education along with local-level monitoring of actual spending.
  • Increasing the transparency of extractives contracts and strengthening government officials' ability to negotiate contracts that are beneficial to the country and its people.
  • Promoting respect for human rights, good governance, and democracy.
  • Investing in national and local-level anti-corruption initiatives.
  • Mitigating and preventing the health, social and environmental impacts of extractive industries.
  • Assuring that communities most affected by extractive company activities share in the benefits created.
  • Curtailing the ease with which illicitly extracted resources can be used to fund violence.
  • U.S. legislation that improves transparency and reduces the use of "conflict minerals" that can help people in developing countries benefit from their national resources.
  • Citizens who work to hold their own government accountable.

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