Escaping the Resource Curse


By Mauricio Villafuerte

(Version in عربي)

It reads like a script for a Hollywood movie—a poor protagonist happens upon an opportunity that has the potential of bestowing riches, but an evil curse threatens to spoil it all.

Unfortunately, it’s not a movie script. The scenario plays out repeatedly in many parts of the real world all the time. For many developing countries, managing natural resources and the increased revenues they bring is a tough haul.

Cue the extensive literature on the “resource curse” and the lack of consensus on how to run fiscal policy and manage budgets in resource-rich countries.

In some respects, this is like the “all-too-similar” sequel, because the tribulations associated with how to best manage natural resources, such as oil, minerals, and gas, seem to endure so that resource-rich developing countries are never quite free of them.

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Topical Trust Funds—The New Assistance Vanguard


By Alfred Kammer

The IMF has begun implementing a new approach to financing its technical assistance by creating a series of topical trust funds that bring together interested donors.

The idea behind the new topical trust funds is to support broader initiatives on policy topics and engage donors on a broader, longer-term, and more strategic basis.

Let me illustrate this with two examples of trust fund programs that we are currently developing. A program on Tax Policy and Administration aims at helping countries mobilize more domestic resources in support of investment toward reaching the Millennium Development Goals, while also reducing their aid dependency.

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