Ricardo Soares de Oliveira - The impact of the extractive industries in Africa

Ricardo Soares de Oliveira, Professor of International Politics of Africa at the University of Oxford, examines the extractive industries in Africa.

About Ricardo Soares de Oliveira "I’m a Professor of International Politics of Africa at the University of Oxford, and co-editor of the journal African Affairs.

My research interests include the workings of the extractive industries (oil, gas and mining) in sub-Saharan Africa; the relationships that African states have established with Asian countries, especially in the last two decades; and, more recently, the politics of global finance and its impact on Africa."

Key Points

• One impact of prioritising the extractive industries is under-development in other areas of the economy. • While Africa only has around 12% of the world’s oil, its welcoming of foreign companies makes it central to the global corporate oil economy. • Building a sustainable future involves not just moving beyond extraction in the long term but also managing dependence in the short term.

Extractive industries and African governments

The extractive industries – oil, gas and mining – are absolutely crucial for Africa. In fact, they are the biggest source of exports from Africa into the world economy. For all but a handful of States, the revenues of African governments tend to come from these sectors. This impacts on everything from how these governments deal with the outside world to the way they deal with their own populations.

In terms of international relations, governments that possess oil and natural resources tend to be more empowered in their relations with other States as well as oil and mining companies. Internally, this also makes a difference. African governments with revenues from the extractive industries face less pressure to tax their own populations. They have their own alternative sources of revenue. Because they have this ready source of revenue, they have been less concerned with the development of other sectors. There’s very little incentive for them to develop industrial sectors or agricultural sectors, which in the long term further consolidates their dependence on oil, gas and mining.