Over the last decade many poor countries have seen huge increases in
revenue from the export of oil, gas and minerals as a result of rising
global commodity prices. Although this income provides a significant
opportunity to reduce poverty and inequality, public spending in
affected countries has often been unproductive. Competition for
resources can also catalyse new forms of social and economic conflict.
Centre for the Future State research explored the experiences of
Ecuador, Bolivia and Peru in managing the boom in natural resource
revenues between 1995 and 2008. All benefitted from windfall revenues
from the export of their main commodities: oil in Ecuador, minerals in
Peru and gas and oil in Bolivia. The research considered the political
and institutional arrangements in place prior to and during the boom and
their impact on strategies adopted for allocating and managing natural
It was apparent that pre-existing political and institutional features,
and not only policy prescriptions, affected the impact of the revenue
windfall, of fiscal shocks and of formal mechanisms introduced to manage
Key messages for policy makers are discussed.
Institute of Development Studies, Brighton, UK, 4 pp.
How do natural resource revenues affect the quality of public spending in developing countries?