Columbian coca leaf. This has led to more self-employment and work for teenage boys in
rural areas, but not to widespread economic spill-over effects, and the financial opportunities
that coca provided have fuelled violence and civilian conflict especially outside the major
cities (Angrist and Kugler, 2008). Greenland benefits from a large annual grant from
Denmark to ensure a similar GDP per capita to the Danish one. As a result, it has suffered
from an appreciated real exchange rate as well as rent seeking from a comprehensive system
of state firms and price regulations (Paldam, 1997).
Others discuss more positive experiences. Forty percent of Botswana’s GDP stems
from diamonds, but Botswana has managed to beat the resource curse. It has the second
highest public expenditure on education as a fraction of GNP, enjoys the world’s highest
growth rate since 1965 and its GDP per capita is at least ten times that of Nigeria (Sarraf and
Jiwanji, 2001). The Botswana experience is noteworthy, since it started its post-colonial
experience with minimal investment and substantial inequality. Of 65 resource rich,
developing countries only four managed to achieve long-term investment exceeding 25
percent of GDP and an average GDP growth exceeding 4 per cent, namely Botswana,
Indonesia, Malaysia and Thailand (Gylfason, 2001). These three resource rich Asian countries
have achieved this by economic diversification and industrialization. Still, they fared less well
than their neighbours Hong Kong, Singapore and South Korea with little raw material wealth.
Norway has shown remarkable growth of manufacturing and the rest of the economy
compared with its neighbours despite phenomenal growth in oil exports since 1971
(Anderssen, 1993; Larsen, 2006). Norway is the world’s third largest petroleum exporter after
Saudi-Arabia and Russia, but is one of the least corrupt countries in the world and enjoys well
developed institutions, far sighted management and market friendly policies.
United Arab Emirates account for close to 10 percent of the world’s crude oil and 4
percent of the world’s natural gas reserves, but has turned its resource curse into a blessing
(Fasano, 2002). Its government debt is very small, inflation is low and hydrocarbon wealth
has been used to modernise infrastructure, create jobs and establish a generous welfare system.
Major strides in life expectancy and literacy have been made through universal and free
access to education and health care. In anticipation of depletion of its natural resources, oil-
rich Abu Dhabi has emphasised petrochemical and fertilizers, Dubai has diversified into light
manufacturing, telecommunications, finance and tourism, and the other emirates have focused
on small-scale manufacturing, agriculture, quarrying, cement and shipping services. Many
Latin American countries have abandoned misguided state policies, encouraged foreign
investment in mining and increased the security of mining investment. Since the 1990’s Latin
America appears to be the fastest growing mining region, well ahead of Australia, Canada,
Africa and the US in terms of spending on exploitation. Chile has recently achieved
remarkable annual growth rates of 8.5 percent while the mining industry accounted for almost