How Vast Mineral Resources Could Be Bad for Afghanistan

NYT discusses perils of resource curse; AP doesn’t

So, the big story of the day—that New York Times front-pager on the discovery of “nearly $1 trillion in untapped mineral deposits in Afghanistan”—has quickly come in for plenty of skepticism, on counts ranging from how this news is not so new to what the motivations of U.S. officials in encouraging this storyline might be.

The pushback is a welcome corrective to some of the language in the Times story, like the claim in its lede, attributed to “senior American government officials,” that the mineral find could “fundamentally alter the Afghan economy and perhaps the Afghan war itself.”

It’s worth noting, though, that on an important underlying question—are vast natural resources actually a good thing for a war-torn, poorly-governed country like Afghanistan?—the NYT article gives ample space to the cause for concern. Here’s the relevant section:

So the Obama administration is hungry for some positive news to come out of Afghanistan. Yet the American officials also recognize that the mineral discoveries will almost certainly have a double-edged impact.

Instead of bringing peace, the newfound mineral wealth could lead the Taliban to battle even more fiercely to regain control of the country.

The corruption that is already rampant in the Karzai government could also be amplified by the new wealth, particularly if a handful of well-connected oligarchs, some with personal ties to the president, gain control of the resources. Just last year, Afghanistan’s minister of mines was accused by American officials of accepting a $30 million bribe to award China the rights to develop its copper mine. The minister has since been replaced.

Endless fights could erupt between the central government in Kabul and provincial and tribal leaders in mineral-rich districts. Afghanistan has a national mining law, written with the help of advisers from the World Bank but it has never faced a serious challenge.

This is what’s known as the “resource curse,” and it’s afflicted plenty of nations that are resource-rich and governance-poor. (For a good NYT look at how international efforts to address the dynamic in Chad failed, see this Lydia Polgreen story from September 2008.) Natural resources can have economic drawbacks for developing nations, too—like driving up inflation while discouraging investment in other sectors of the economy—but the Times captures some of the chief political risks pretty well.

The NYT doesn’t necessarily deserve a gold star for that—the resource curse is that rare bit of social science research that’s gone more-or-less mainstream, and plenty of other observers promptly raised this concern.

The Times coverage looks more notable, though, compared to the Associated Press rewrite, which manages to preserve the hype of the NYT account while excising the notes of caution. Here’s the portion of the AP article that summarizes the NYT story:

The New York Times reported the $1 trillion figure in Monday’s edition and quoted senior American officials as saying untapped mineral deposits in Afghanistan are far beyond any previously known reserves and were enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself.

Americans discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, including iron, copper, cobalt, gold and critical industrial metals like lithium, according to the report. The Times quoted a Pentagon memo as saying Afghanistan could become the “Saudi Arabia of lithium,” a key raw material in the manufacture of batteries for laptops and cell phones.

“There is stunning potential here,” the newspaper quoted Gen. David H. Petraeus, commander of the United States Central Command as saying. “There are a lot of ifs, of course, but I think potentially it is hugely significant.”

Nothing there about the risk of increased corruption or worsening conflict. And that’s followed by some further hype from Afghan officials—forget $1 trillion! It’s actually $3 trillion!

In fairness, the AP account does push back against the most rosy-eyed estimates, noting that market variability, the time needed to develop the necessary infrastructure, and the fact that the Taliban controls some of the territory where the minerals are located may all limit the anticipated windfall. But nowhere does the story acknowledge a key factor: for a country in Afghanistan’s condition, the discovery of natural resources is as much a crisis as an opportunity.

P.S. Hat tip to Erin McCann, who flagged the lackluster AP coverage in a reply to the CJR Twitter feed. You can follow us here.

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Greg Marx is an associate editor at CJR. Follow him on Twitter @gregamarx.