Are Natural Resources A Blessing or A Curse?: A Comparative Analysis of Wakanda and the Democratic Republic of Congo

By Melissa Wei

Deep in the heart of Africa lies a nation with deposits of one of Earth's rarest and most highly valuable precious metals critical to the next technological revolution. This country will attempt to nationalize the wealth of this resource in an effort to uplift its people into prosperity and desperately protect it from exploitative domestic and outside forces. The ultimate question therein lies: will this resource become its greatest blessing or a ruinous curse?

This is the premise of the $1.3 billion blockbuster hit, “Black Panther”, depicting the fictional African nation of Wakanda located in the Marvel Cinematic Universe (MCU) and the journey of its King, the Black Panther, in navigating the future of their most valuable resource, the strongest metal on Earth, Vibranium. Superhuman drugs and bulletproof panther suits might seem out of this realm but a country like Wakanda might not be as far-fetched as one might think. With the world in a race to transition to sustainable sources of energy and electric vehicles, the rechargeable battery market has received meteoric attention from global economic leaders, having been compared to the replacement of oil as the new source of energy. These developments have made cobalt, the ideal material for thermal stability and high energy density in ion batteries, into our world’s Vibranium and the Democratic Republic of Congo, which holds half of the Earth’s supply and produces 70% of global stock , into a real-life parallel to Wakanda. They have won the metaphorical natural resource lottery, especially with global demand for cobalt expected to grow fourfold by 2030, according to the World Economic Forum. But like many lottery winners, some fair worse than before, while some prosper like no other. Likewise, Wakanda is the wealthiest fictional nation in the world of the MCU, while Congo is the poorest in ours. How could two countries, both so resource-rich, have such contrasting political economies?

This long-observed trend by economists since the 16th century has been given many names, the paradox of plenty or poverty paradox, but it is most well-known as the resource curse. Simply put, it is a theory that states countries rich in natural resources often have worse economic growth and development than those with less. Considering that raw materials are an integral part of production, it wouldn’t be wrong to argue that economic growth comes from having an abundance of natural resources. Paradoxically, pioneering studies by Sachs and Warner (1995 and 1997) compare resource-poor Asian Tigers that were experiencing an uninterrupted growth pattern to oil-rich countries that were experiencing bankruptcies. Many strong empirical studies have found similar results in agreement, countries with higher exports of natural resources experienced the lowest economic growth, while those without or with less natural resources had the highest economic growth. Numerous studies have been conducted to find the factors causing economic growth in different contexts and countries. To better understand the causes theorized by the latest in economic research, the comparison between Wakanda and the Democratic Republic of Congo (DRC) serves as a great model.

At Wakanda’s origin, when the five African tribes that would come to form the country discovered Vibranium they peacefully united to share the resource led by a shaman who would become the first Black Panther, Bashenga. Fascinatingly in parallel, when the abundant deposits of minerals including cobalt were discovered in Congo they had just declared independence from their Belgian colonizers and broken free from corrupt capitalist hands. Congo was on the path to rebuilding new political and economic institutions in hopes of sharing the wealth of the resources under strong government oversight led by the first democratically elected Prime Minister of Congo, Patrice Lumumba. He was seen as a martyr for the pan-African movement, an independence leader, and was essentially the DRC’s first Black Panther.

This is where an interesting difference occurs between these two nations; Wakanda’s tribes settled on a constitutional monarchy under the rule of a super-warrior king who saw it best to hide the nation from the outside world. Wise leadership meant Wakanda had escaped colonization and the slave trade which allowed them to evolve their socio-cultural, political, and economic institutions naturally and gradually without interference. In contrast, the DRC’s way of life was replaced with extractive and exclusive colonial institutions for centuries. After earning independence, the surviving factions settled to be an unstable democracy with armed and extremely divisive political parties making up differing ideologies, nationalities and ethnicities. While Wakanda continued to have their stable political setup for millennia enforcing strong institutions, the DRC, having to start anew with fragmented groups, fell into political turmoil and created institutions that hadn’t improved much from their colonial history ridden with corruption and instability. To put into frame the extent of the issue, a few months after being elected, Prime Minister Lumumba, the “Black Panther” of the DRC, was assassinated by his political rivals who then created nationalized companies that accumulated $1 billion in wealth which they kept for themselves. Not long after, they were replaced and what followed was autocracy after autocracy which continued to “milk the country unabated”.

Many studies have shown strong empirical evidence that natural resource endowments are often an economic boom for well-governed countries like Wakanda but a burden for those with weak political institutions like the DRC as governments play a key role in managing/regulating extraction, signing trade agreements & securing resources such as capital investments in a highly competitive market. In the presence of weak political and economic institutions, the fiscal revenue windfalls from abundant mineral resources generated opportunities for corrupt government officials to extract rents and divert funds from the local economy. It also meant that rebel armies had plentiful funding to support their armies and the looting of eastern Congo by the governments of neighboring countries began. Involvement of the MNCs in the exploitation of mineral resources was a huge factor in the preservation of the armed conflict and resource curse as rebel groups have economic interests that are forever met by MNCs. As a consequence, these activities undermined the state's already unstable authority in the mining regions and empowered the local militia to have access to the mining regions for personal and selfish rewards. The DRC was ultimately unable to successfully convert their resources into other productive assets nor were they able to improve their mining infrastructure as they are still highly reliant on artisanal mines, which raises several ethical questions on child labor or low wage levels. Widespread inequality, mass human rights violations, and lack of proper infrastructure to monitor and manage its resource industry led to foreign entities ending trade relations and pulling out of the country. In 2023, 60% of Congolese survived on less than $2.15 a day, while food-price inflation reached 173%. Consistently, the DRC has the lowest, or nearly the lowest, nominal GDP per capita in the world.

The DRC also suffered through another cause of the resource curse, the well empirically supported Dutch Disease which states an increased capitalization on natural resources leads to a decline in other sectors of the economy. Resources are reallocated from other sectors, such as manufacturing, agriculture, fishing, etc., to the primary commodity, and as a result, both the external as well as the domestic economy are affected. The external sector’s exports become less and less competitive when the exchange rate starts to appreciate. The domestic sectors disappear as workers flock to the booming mining industry and deindustrializing occurs as it becomes overly dependent on one resource and extremely sensitive to the fluctuations in its price. The DRC generated up to 70% of its export revenue from minerals in the 1970s and 1980s, and by 2005, 90% of the DRC's revenues derived from its minerals, thus it was particularly hit when resource prices deteriorated.

In comparison, avoiding the effects of the Dutch disease Wakanda has a well-diversified economy preventing an overreliance on the production of raw Vibranium with each of their five tribes specializing in different trades; mining, fishing, defense, arts & technology. Their leaders, being forward-thinking and observant of outside interests, had kept their resources and development hidden from the rest of the world which allowed their institutions to incrementally adapt to Vibranium without currency appreciation and foreign influence. In addition, by investing in human capital, they were able to generate sectors that would render their raw resource of Vibranium into productive assets and generate new industries such as medicine, transportation, fashion, energy, technology, etc. In tandem, economic studies found that countries that are rich in resources if there is a low amount of human capital suffered from the resource curse.

Being a closed economy also meant that Wakanda wasn’t sensitive or dependent on Vibranium’s price volatility in the global market. Other nations have made less drastic decisions to escape the resource curse such as Norway which announced that its trillion-dollar sovereign wealth fund would divest its oil and gas exploration and production investments for the purpose of diversification, gradual shifts, and avoiding rapid currency appreciation that would reduce domestic products competitiveness in foreign markets.

As such, the strength of their political and economic institutions, the external influence of global markets and agents, as well as the forward thinking policy strategy of their leaders are ultimately what diverged the paths of these nations.

All in all, Wakanda and the DRC’s comparison shows how it is important to realize it isn't necessarily the abundance of resources that is the fuel driving poor economic growth. Countries aren’t destined for great economic devastation if they are resource rich. In the case of the DRC, it is more of a spark that has the potential to burn a country’s economy to the ground, revealing the rotting structure underneath, further exacerbated by the environmental conditions around it which forms the phenomenon we call the resource curse. The structure is the political and economic systems in place to harness and optimize such a surge in resources and the environmental conditions being the highs and lows, exploitative or cooperative agents of the global economic community. Yet for countries with forward-thinking mechanisms in a well-established structure, no matter the environmental conditions, the spark of resources can light the engine of economic growth as seen in Norway, Canada, and especially Wakanda; the fictional rewriting of history and destiny for many African nations in terms of escaping slavery, colonialism and ultimately, the resource curse.