Mar 31, 2014

IMF: resource money should go to the government, with hopes of trickling down to the poor.

IMF Survey : Natural Resources Can Play Key Role in Inclusive Growth (Mar 2014):
"Governments need to provide investors with credible fiscal and regulatory regimes within which to explore, develop, and produce. Governments also need to meet their responsibilities for infrastructure, social services, and security in extraction areas. In return, governments expect to receive a reasonable share of the revenues."
"Governments have options when it comes to the revenues they receive from natural resources. Critically, they must decide how much of the resource revenue flows to consume now and how much to save/invest for future generations; and how best to save and invest—that is, in the domestic economy or abroad in foreign assets."
"By setting up natural resource funds governments can deal with resource revenue volatility (stabilization funds), meet development needs (development funds), and save for future generations (savings funds)."
"Rapid and sustained poverty reduction requires inclusive growth that allows people to contribute to and benefit from economic growth—a big challenge under natural resource development." If well designed, targeted cash transfers have shown they can help reduce income inequality. Experience in the region has also shown that linking eligibility for transfers to investments in education and health can promote more inclusive growth."
"Targeted cash transfers" is just another term for welfare spending. Not a word about citizen dividend. 

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