Why is it that the countries/continents with the richest natural resources in the world end up the poorest?

Question

Why are "Third World" countries "Third World" countries?

Answer 1

I think often this is because such countries are prone to unfair (?) exploitation by outside special interests while they are still in the early stages of development (when valuable resources are discovered). Their government structure may not be prepared to address the social development issues that accompany wealth. A few leaders wind up making resource distribution decisions that they are often not equipped to make. These leaders are still operating in the "survival mode", making them prone to corruption. Also, early in social development, aggressive leaders often muscle their way into power, ignoring the will of the general population in favor of special interest (warlords are an extreme example). Once in power, they are difficult to remove.

Answer 2

Why is it that the countries/continents with the richest natural resources in the world end up the poorest?

Before answering the question, its important to understand that while some rich-in-resources countries end up poor ( for example Russia), there are many rich-in-resources countries that are doing pretty well. For example, USA, Canada, China, Australia ... The bigger the land size of the country the more chances that country has to have more natural resources.

Back to the question: All of the above responses by other members are in the ball park. Mentioning Corruption, Financial Mismanagement, Foreign Exploitation, ...

However, a more direct response to your question is simpler than you think.

The answer is Historical Coincidence.


Without getting in to depth of WHY? There are many theories answering the why question. Ranging from European colonization, Exchange & Development of economics ideas, up to the weather affecting Historical Coincidemce.

In modern days, you have developing countries such as Russia Some Arab countries, which have the most natural resources.
Those countries seek immediate Economic gratification by selling their resources. While they lack the infastracture of developed countries, if they could get their act together they would be on the right path to success ceteris paribus!

1st World Countries like USA, Canada, ... Can get much cheaper resources from countries like Russia then to exploit their own resources. Russia's does not have strong Labor Unions, Environmental Groups, and other restrictions all of which add to the total cost of resources

Answer 3

Africa is likewise a continent in turmoil-wars,genocide,deforestation, rape and pillage of the folk and the continent via white Europeans in general, apartheid,suppression of the Africans--Africa till the white guy invaded and so forth replaced right into a continent of international locations at conflict with one yet another there replaced into no universal team spirit while the Europeans-Dutch,German,French and so forth settled and commenced forming governments controlling faculties and the critically repressed education of the Africans and as a manner to be an factor of marketplace,commerce the folk could be schooled,taught the bits and bobs and be prepared, It hasn't been that long on condition that Africans have been given their independence from ecu suppression and there is not any team spirit and till that occurs the place a usa can set up a central authority it is for the forged of the people who commerce and marketplace can flourish. in undemanding terms some ideas for to get each and all of the themes into the final perspective -there are a lot of in Africa on the instant is quite a tension mentally.

Answer 4

Because wealth is found in the human mind. Great minds get together and invent things, processes and services. Wealth is generated by entrepreneurs who use what is already available to them to satisfy a need in society. Where people are repressed in their freedom to move about, think, learn, peaceably assemble, remain free from crime, choose how their money or energy is invested, etc., poverty is the inevitable result. We have great wealth in America because it was and has been for over 230 years a country founded on freedom. A free enterprise system founded upon government by the consent of the governed. Countries where you have the smallest per capita earnings on average, are countries where there are little or none of the above freedoms.

Answer 5

Because it doesn't have anything to do with resources it has to do with freeing the creative potential and productive capacity of the population. Eg. Japan and Switzerland.

Go to the Cato insitute and look at their comparison with standard of living and freedom. You'll see that where the government protects property rights and leaves people alone there is prosperity. And where the government runs the economy there is starvation and ruin.

Answer 6

because they are economically dependent to the more advanced countries. most of this "resourcefull" nations have limited way (mostly technological problems) in fully exploiting their resources. as a result, the one reaping benefits from their resource are not them but nations who have the ability to fully utilize the product. these countries, wether they want it or not is controlled by the more economically powerful nations. the more powerful gets richer, them...they remain poor

Answer 7

b/c a small (but well-armed) group of people can (and does) keep all the money that comes from natural resources.

w/o natural resources, the only way for government to make money is to develop the actual businesses and then tax them (moderately).

Answer 8

corruption