Natural Resources Revenues, Agriculture Development and Urbanization in African Countries


This paper analyzes the mechanism through which natural resource abundance leads to a poor agricultural performance and a rapid urbanization in African countries. We conducted a static and dynamic panel data analysis for a panel of 39 African countries during the period 2000-2013. Our findings show that natural resources rents have a negative impact on agricultural performance and a positive impact on food import dependency. In addition, the results show a significant positive impact of resource rents on rural-urban migration and on urbanization rate. We argue that these findings can be explained by the government choice to specialize in primary commodities to the detriment of the development of other productive sectors, especially agriculture. Because policy makers tend to invest resources rents in developing infrastructures, mostly in cities, this inevitably creates some pulling factors for rural population in search of a better life. Consequently, we observe a rapid urbanization associated with serious problems (Expansion of urban slums, limited access to improved water and sanitations facilities) in many African countries, highly dependent on natural resource rents.