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Geopolitical Tensions, Natural Resources, and Environmental Policies

Sat, September 7, 2:30 to 3:00pm, Pennsylvania Convention Center (PCC), Hall A (iPosters)

Abstract

How do geopolitical tensions shape natural resource and environmental policies in Africa? In the wake of the Russian invasion of Ukraine, heightened geopolitical tensions among the great powers such as the US, Russia, and China have engendered rippling economic and political outcomes in the natural resource and environment sector across developing countries. However, there is no consensus on how precisely geopolitical tensions shape natural resource dependence and environmental policies. This paper argues that tensions create a demand and consumption effect that incentivizes rapid investments in the resource sector to take advantage of the rising demand and high commodity prices. This phenomenon leads to increased resource dependence as well as a relaxing of environmental laws to allow for increased resource extraction. Using data applied to 16 resource-rich African countries, the paper finds, however, that the impact of tensions on resources depends on the global powers involved. US-Russia tensions increase dependence on forest resources but not on oil and minerals. US-China tensions on the hand increase dependence on oil and mineral resources but not on forest resources. On the environment, the study finds that while US-Russia tensions lead to a decline in the enforcement of environmental laws, US-China tensions do not. The paper contributes to the literature by helping understand how different geopolitical tensions shape different natural resource policies and the environment in developing countries.

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