The resource curse is a term used to describe a nation’s dependence on minerals or fossil fuels to power development and economic growth. In the Middle East, this “paradox of plenty” has historically led to productive economies with bloated public sector employment, expensive welfare rolls, distortionary subsidies, and undisciplined fiscal policies.
Conversely, countries lacking resource wealth find themselves compelled to keep a tight rein on government spending and to prioritize human capital and innovation. Saudi Arabia made headlines several years ago when it unveiled Vision 2030, an ambitious plan for moving the kingdom away from reliance on fossil fuels by restructuring the government to stimulate private sector growth outside of the oil sector.
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