John Heilbrunn is among an emergent group of writers working to dispute the “resource curse” thesis and to argue that the development of extractive industry projects is actually reducing poverty and bringing economic development and democracy to Africa. Readers looking for a clear articulation of this argument will find it in Oil, Democracy, and Development in Africa, which is exemplary of this emergent line of scholarship. For Heilbrunn and the rest of this group of writers, oil is a “blessing,” not a curse (Haber & Monaldo, “Do natural resources fuel authoritarianism? A reappraisal of the resource curse.” [The American Political Science Review 2011]). In this continent-spanning analysis, oil production generates democracy and development by allowing for an expansion of the middle classes, who apply pressure on political leaders to invest oil revenues in social sectors of the economy. This is a handy argument for those whose fortunes depend on the fossil fuel economy. Unfortunately, Heilbrunn does not offer a compelling theory of the case or provide empirical support for this argument.
The main thesis of the book, which sits awkwardly alongside the contention that extractives contribute to development and democracy, is that “political and economic conditions present before hydrocarbons are discovered influence these countries’ developmental and political trajectories for decades” (9). By “political and economic conditions,” Heilbrunn means institutional capabilities, such as the capacity of governments to negotiate fair deals with oil companies, stem corruption, manage oil and mineral rents to the profit of the public, and provide a professional class of workers for multinational companies. To make his point, he compares two relatively new oil-producing countries: Ghana and Chad. Ghana, he argues, was able to regulate oil companies and prevent inflation through the tightening of fiscal policy (though not to prevent corruption and collusion) because it had “stable” institutions when oil was discovered. In contrast, he describes Chad as suffering from “chronic violence and poverty,” which he dates to 1975 and the coup that toppled President Tombalbaye after he awarded an exploration license to Conoco, an American company, instead of to France’s Elf Aquitaine. I focus on two of the many points that might be made about this thesis.
Based on this thesis and the problematic tenets of modernization theory embedded in it, extractives would not seem to be the way forward in all situations—arguments civil society organizations in Chad and elsewhere made on the eve of the oil boom. Heilbrunn’s rejoinder is that, regardless of the level of preparedness or institutional capacity, countries are better off with oil than they would be otherwise. This claim echoes one the World Bank made following the demise of its experimental pipeline project in Chad. While rating the project “unsatisfactory,” the World Bank’s Independent Evaluation Group (IEG) justified the investment by arguing that it resulted in more investment in social and economic sectors of the economy than would otherwise have been the case (IEG, Program performance assessment report. Report no. 50315. [Washington, DC: The World Bank Group 2009]). Despite the less-than-stellar outcomes of this model effort, the IEG therefore urged the Bank to continue investing in extractives. Without oil, Heilbrunn writes, African economies would be “agrarian, subsistence economies,” dependent on foreign aid. Some of these claims are simply fallacious. African economies are not subsistence economies and haven’t been for a very long time. They are also counterfactual; there is no way to test them because they relate to what has not happened.
A second point has to do with the considerable weight Heilbrunn places on the past and on the actions of colonial powers in structuring institutional capacities in contemporary African states. But there is no need to look to the last century to explain institutional dysfunction. We could instead examine the present-day, anti-democratic tendencies of global oil companies and their financiers. While the World Bank touted its capacity to change the Chadian Constitution to include Law 001, a revenue management law dictating how the government would spend its oil-related windfall, it passively accepted colonial-era land laws which claimed land for the state, depriving smallholder farmers of land and millions of dollars in compensation. The World Bank did not move to prevent President Deby, now in his fifth term in office, from altering the Constitution to remain in power or to impede global oil companies from squeezing Chad into a deal for which the country receives pennies on the dollar for its oil. Path dependency has limits, and colonialism, while it lives on, does not structure the future of African countries so much as the actions of actors we are witnessing right now, in the present.
If you want to understand how the World Bank thinks about oil and the extractive industries or what the new smoke-and-mirrors scholarship about oil as a “blessing” and an “opportunity” for poor countries is all about, read this book. But look elsewhere if you want to understand why African oil producers are so often cursed.
