The Political Economy of Natural Resources in South America

Since the beginning of this century, the remarkable and prolonged commodity price boom has brought about a drastic change in the regional macroeconomic scenario. This was correlated with the changing nature of the dilemmas faced by the economic policy. For most South American economies, the central macroeconomic issue, unlike what had happened in the last quarter of the previous century, no longer was how to deal with the foreign exchange shortage but how to deal with the external boom. There is no doubt that natural resources have a number of peculiar characteristics. But just as there are countries for which their abundance is a “curse”, there are others for which this represents a “blessing”, revealing that the problem does not lie in these peculiarities but in the way in which each society manages to organize their exploitation.