John Campbell

Africa in Transition

Campbell tracks political and security developments across sub-Saharan Africa.

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Africa Impoverished?

by John Campbell
September 21, 2012

A woman and her children wash gravel from local mines in hope of finding sapphires in the town of Sakaraha 16/09/2007. (Jasleen Kaur Sethi/Courtesy Reuteres) A woman and her children wash gravel from local mines in hope of finding sapphires in the town of Sakaraha 16/09/2007. (Jasleen Kaur Sethi/Courtesy Reuteres)

I had always thought that Africa was a cornucopia of mineral riches:  gold, platinum, coal, diamonds, oil–you name it; Africa has it all.

Maybe not so, writes Bright Simons in “Africa’s Fabulous Mineral Wealth that Isn’t all There,” published in African Arguments. 

He argues, inter alia, that on a per square mile and on a per capita basis, Africa is poorer in mineral production and reserves than the world average. Only ten of the hundred minerals most important to industrial production play a major role in African mining. Further, their production and reserves are concentrated in only four countries: South Africa, Angola, Congo, and Guinea.

His “per capita” argument is intriguing:  Norway and Nigeria each produce about the same amount of oil per year.  Using 2012 prices, he calculates that if the oil revenue were divided equally among all 4,707,270 Norwegians, he or she would each receive $15,000.  But under the same methodology, the nearly 170,123,740 Nigerians would receive only $460. His discussion of the value of minerals is also fascinating.  He states that the worldwide value of gold reserves is about $2.6 trillion using 2012 prices.  The total value of gold production in 2011, again using 2012 prices, was $138 billion. Africa’s share was worth about $30 billion.  Iron is in short supply in Africa.  Worldwide, he estimates the value of iron reserves at $128 trillion.  The value of 2011 iron production was about $475 billion. So, the value of iron reserves and production greatly exceeds the value of gold.   And while Africa has the latter, it has little of the former.

Simons’ argument is the beginning of a conversation, not the end. But, these considerations highlight the possibility that advocates of the “resource curse” argument may be short-sighted.

It is also relevant to note that when the African National Congress came to power in South Africa after the 1994 ‘non-racial’ elections, its leaders were surprised that the country was not nearly as rich as they had thought it to be.

Post a Comment 5 Comments

  • Posted by Emeka Chiakwelu

    Bright Simons lacks the fundamental understanding of economics. The natural resources of a nation is best measured not by the primitive calculation of diving the worth of the resources by the population. It is beyond the narrow understanding of Bright Simons’s perspective.

    The richness and advantage of having natural resource is the ability to use it for further creation of wealth. The significant optimization and utilization of natural resources are to use the funds generated from them to build educational and industrial infrastructures that are needed for wealth creation. Even the fund derived for oil export can be used to provide security leverage that will enable the attraction of capital and investments.

    Therefore Bright Simons perspective is crude and obsolete from 21 st century understanding of wealth and wealth creation.

  • Posted by Mikael Berg

    Really intriguing. I am beginning to think people have taken it so much for granted that no one has really conducted any quantitative studies yet.

  • Posted by Zainab

    “His “per capita” argument is intriguing: Norway and Nigeria each produce about the same amount of oil per year. Using 2012 prices, he calculates that if the oil revenue were divided equally among all 4,707,270 Norwegians, he or she would each receive $15,000. But under the same methodology, the nearly 170,123,740 Nigerians would receive only $460.”

    One only needs knowledge of the most elementary arithmetic to realize that using Bright Simon’s flawed logic, dividing the Norway and Nigeria’s almost equal oil wealth by the former’s 4 million people and Nigeria’s over 170million would OF COURSE mean that Nigeria has a lower per capita income, not because Nigeria and “Africa is poorer in mineral resources and reserves” but because of the sheer numbers.

    Bright Simons’ extremely faulty and flawed logic is hardly the “beginning of any conversation”

  • Posted by John Ojeah

    Exactly my point to most Nigeria cynics. Not only Norway, but Kuwait, Saudi Arabia, Russia, Qatar, Equitorial Guinea, Brazil, USA, Canada, Australia, UK, Angola, etc all produce more oil than Nigeria per capital.

    I look forward to a time when oil will not be a dominant issue in the politics and economy of Nigeria. A situation were all the intellectual of a whole political class is concentrated on how one region should get more oil than another without even the slightest issue of what else can be brought to the table is sad.

  • Posted by Ismail Ayub

    Emeka and Zainab lack both the intellectual resources and the humility to understand the nuances in the author’s point that Africa COMPARED to the rest of the world is not rich in natural resources. Their emotional responses betrays the ignorance and arrogance that makes it difficult for serious intellectual conversations to be had in Africa. What a shame!

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