Skip to main content

The Real Raw Material of Wealth

Poor countries export raw materials such as cocoa, iron ore, and raw diamonds, while rich countries export – often to those same poor countries – more complex products such as chocolate, cars, and jewels. But this does not mean that poor countries should focus solely on adding value to their raw materials.

TIRANA – Poor countries export raw materials such as cocoa, iron ore, and raw diamonds. Rich countries export – often to those same poor countries – more complex products such as chocolate, cars, and jewels. If poor countries want to get rich, they should stop exporting their resources in raw form and concentrate on adding value to them. Otherwise, rich countries will get the lion’s share of the value and all of the good jobs.

Poor countries could follow the example of South Africa and Botswana and use their natural wealth to force industrialization by restricting the export of minerals in raw form (a policy known locally as “beneficiation”). But should they?

Some ideas are worse than wrong: they are castrating, because they interpret the world in a way that emphasizes secondary issues – say, the availability of raw materials – and blinds societies to the more promising opportunities that may lie elsewhere.

We hope you're enjoying Project Syndicate.

To continue reading, subscribe now.

Subscribe

Get unlimited access to PS premium content, including in-depth commentaries, book reviews, exclusive interviews, On Point, the Big Picture, the PS Archive, and our annual year-ahead magazine.

https://prosyn.org/WQk5yRu;
  1. bildt69_DELIL SOULEIMANAFP via Getty Images_syriansoldiermissilegun Delil Souleiman/AFP/Getty Images

    Time to Bite the Bullet in Syria

    Carl Bildt

    US President Donald Trump's impulsive decision to pull American troops out of northern Syria and allow Turkey to launch a military campaign against the Kurds there has proved utterly disastrous. But a crisis was already inevitable, given the realities on the ground and the absence of a coherent US or Western policy in Syria.

    2

Cookies and Privacy

We use cookies to improve your experience on our website. To find out more, read our updated Cookie policy, Privacy policy and Terms & Conditions