March 27, 2013


From non-renewable resources to unlimited knowledge

Developing countries often have more natural resources than they know what to do with. The resources course is still a popular subject for books and essays in the development industry. Decades of work on the subject and still very little has been done to avoid it. Here is a solution: Make the resources themselves the focus of a knowledge sector.

I wrote about it last year on Got resources? Think Tank Them. At the time, I argued that:

The University of Dundee in Scotland is host to students from all over the world who travel there to read courses related to the mining sector. Many Peruvians study there –I know a few of them. Last I heard, though, there aren’t any mines in Dundee were they can practice and experience, first hand, the industry they are studying. So why would a Peruvian leave a country rich in mines to study in Scotland where the mining industry is all but a thing of the past?

The answer is simple: Peru does not have a world-class university that specialises in mining.

The same is true for forestry, tourism, and pretty much everything that is exploitable. Expertise is always somewhere else. And it is not just about extractive industries (of the non-renewable kind): certain crops such as coffee, cocoa and now quinoa remain unexplored for their potential. We sell them to be repackaged and rebranded elsewhere. I find the idea of someone selling ‘Italian coffee’ or ‘Belgian chocolate’ something of an oxymoron. Can someone please show me the coffee plantations in Italy?

And we are to blame. Not only have we not made investments that developed countries did in their tertiary education and research sectors but we have no even done what a few progressive developing countries did either. Colombia, for example, did not just ‘imagine’ the ‘Colombian Coffee’ brand over night. The fact that Colombia has one of the best education sectors in the region goes a long way in explaining its success (at least until recently).

I followed that blog with an article in a Peruvian Newspaper, El Comercio, in which I used the same title as for this blog. By investing in think tanks and universities specialised on our natural resources, I argued, we could shift from an economy based on extraction to one based on knowledge. The former limited; the latter unlimited.

Here is another article, written in the Arab News by Abdulateef Al-Mulhim: Kingdom needs oil industry think tank, that deals with the same issue. In it he makes similar arguments to those I made before and adds something that rings so true in relation to how policy is made across the world:

Does anyone remember the words, “we play it by ear?” These were the words of Sheikh Ahmed Zaki Yamani, the most famous and most influential oil minister in the world from 1962 till 1986. These crucial words were not the words that were circulating in the oil industry. He said these words loud and clear at a symposium about oil industry and production capacity.

Al-Mulhim offeres an encouraging vision:

Saudi Arabia needs a genuine independent research center with no ties to any official organization in the Kingdom. And in later years, this research center could be the information center of the world in the oil and gas sector. All the petroleum intelligence reports should come out from a Saudi think tank. And most importantly, the research center must be staffed by capable people to study the impact of oil industry on Saudis, politically, socially or economically.

Countries rich in resources should share this vision too. Become global centres of excellence in their sectors and industries. And they should do so, in part, because it is in their best interest to do so.

Al-Mulhim reminds us, too, that think tanks are there not only to inform policymakers but also to educate the elites and, eventually, the public (maybe through the media). He suggests that most Saudis do not know much about the Oil industry; I would argue that similarly, most Peruvians do know much about the mining and coffee industries (two of Peru’s largest commodities), that most Zambians do not know what goes on in the Copperbelt, that most Indonesians are unaware of the details of the forestry and palm oil industries, etc.

The model for a think that focused on a sector or industry that I put forward is:

These think tanks could focus their attention at three levels:

  • The policy environment: research and analysis to develop recommendations directed at improving the policy environment that affects the sector.
  • The business environment: research, analysis and direct support aimed at strengthening the capacity of existing and future businesses to further develop the industry –sustainably, responsibly, etc.
  • The art and science of the sector: (maybe in the long-term) aimed at improving the evidence base of the sector –for example, research into new varieties of timber, into new ways of treating mineral waste, into the commercialisation of new agricultural products, the use of new seeds, etc.

But we must take care that, as Abdulateef Al-Mulhim concluded, these think tanks think and don’t just play it by ear.

About the author:

Enrique Mendizabal:  Founder, On Think Tanks

Read more from: Enrique Mendizabal