NS4054: Energy Security Fall Term 2015 “Oil Rents and Political Power in Africa ” Jessica Piombo Reviewed by Brandon R. Brown

Introduction African states are among the richest in terms of natural resources, yet they tend to be the least developed in the world. Purpose of the Chapter: to analyze the politics of oil in sub-Saharan Africa economic impacts of oil relationship between oil and politics Focuses on Angola, Cameroon, Equatorial Guinea, Gabon, Nigeria, and Sudan

Overview African Oil: A Brief Overview Economic Impacts Impacts of Oil on Politics Oil and State Building Oil and Governance Oil and Policy Process Corruption Oil and Conflict Conclusion

African Oil: A Brief Overview Exporter of Crude Oil Historically Found Offshore Mostly State-Owned Oil Companies Sold on the Global Market Domestic Use Domestic Energy Crisis rolling blackouts diesel generators

Economic Impacts Creates an Enclave Economy few domestic workers profits accrue to the state Government Revenue Dependent on Oil Nigeria, Angola, DRC, Equatorial Guinea: 60-90% Foreign Investment Gravitates Toward Oil Slows Economic Development the resource curse Governments Choose not to Diversify State Becomes Vulnerable to Oil Shocks

Impacts of Oil on Politics Access to oil rents has led to an extreme form of personalized rule and a disconnected political regime.  Oil and State Building  Oil and Governance  Oil and Policy Process  Corruption  Oil and Conflict

Oil and State Building State Building = Build Institutions control – tax – provide public goods civil involvement in politics Borders Designed for Extraction coastal capitals extractive infrastructure limited movement across territory “Uncaptured Peasantry” / Urban Bias Institutions Intentionally Weak Location of Oil Determines Level of Control

Oil and Governance Closed Governments based on patron-client relationships Limited Political Competition Control of the Central State is Paramount Oil Rents and State Power clients control state institutions co-op or repress rivals control media and intellectual community

Oil and Policy Process Designed to Support Patron-Client Network and Cloak Extraction Activities masks who gets what Public Goods used to Payoff Clients Economic Development = Competition little incentive to develop an independent entrepreneurial class that might demand reform or gain influence over clients

Corruption Oil Rents Substitute Good Governance State Institutions are Intentionally Weak and Underfunded corruption as a means to survival the cost of doing business No Taxation, No Civil Accountability No Need for Foreign Aid, No International Accountability no incentive to operate effectively or efficiently

Oil and Conflict Oil Revenue Does Not Make Countries More Peaceful Civil Conflict environmental degradation demand for share in oil revenues fight for central power Border Disputes Location of Resources Determines Conflict Duration off-shore oil versus on-shore oil other natural resources

Conclusion Forms Patron-Client Networks Undermines the link between State and Society Opposition is Repressed Retaining Political Power is more Important than State Development Forms an Enclave Economy Stability Reliant on Oil Prices Oil Rents can Fund Repressive Conflict