Resource Curse: Why Capitalizing on the Resources Is Actually the Exception?

Oct 13, 2025 | Nadhem Mahmoudi
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This phenomenon refers to the paradox of countries with vast natural or mineral resources who fail to translate those resources into economic prosperity. The resource curse is not, as the name may suggest, just bad luck. When a country discovers abundant resources like oil or minerals, it often over-focuses on them and neglects other sectors like manufacturing or agriculture (a phenomenon called Dutch disease: resource exports inflate the currency and other industries become uncompetitive). Governments may also fall into rent-seeking where elites get the resource profits, which eventually leads to corruption and weak governance. In some cases, resources spark conflict as groups fight for control.