Explaining Resource Nationalism
| Author | Sam Pryke |
| Date | 01 November 2017 |
| Published date | 01 November 2017 |
| DOI | http://doi.org/10.1111/1758-5899.12503 |
Explaining Resource Nationalism
Sam Pryke
Wolverhampton University
Abstract
This article attempts to dissect the term resource nationalism (hereafter RN). It looks first at the origins of the term. Second, it
examines various definitions of RN: in the business press where a zero sum conception of state and corporate interest is gen-
erally assumed, related definitions in academic writings that hinge on the relative control of resources by government and
company, explanations that subsume the phenomenon within economic nationalism, accounts that stress how it restricts out-
puts and, finally, recent discussions that question prevailing understandings of RN and emphasise instead the diversity of its
contemporary forms. The article then considers drivers of RN: the capture of economic rents, the corollary of the influence of
market prices on this objective, obsolescing bargaining, the pressures of natural scarcity and the role of national identity.
Fourth, the global context, commercial and legal, in which RN operates. Finally, the article considers the fluctuations in RN in
recent years.
Policy Implications
•Resource nationalisms are, despite cartels, one factor underlying the lack of global regulation of natural resources. An
effective global policy, so desperately needed in the context of finite resources and unsustainable warming, would require
a transformation in current trading regimes to combine the dynamism of corporate exploration with sustainable priorities.
•Resource nationalism is not new. The quest by nation states to benefit from the ownership and control of natural
resources within their jurisdiction has a long history and is evident periodically since the mid-twentieth century.
•Resource nationalism is a widespread and normal policy of states –especially with energy supply. Such an understanding
is at odds with dominant definitions of resource nationalism that assume antagonistic, zero sum, relationship between a
state and foreign company involved in the extraction of a natural resource.
•There is very little international regulation to limit resource nationalism. The WTO makes limited attempts to involve itself
in the resource policy of members. So the determination of trade agreements between states and companies is through
bilateral deals.
•There was a rise in resource nationalism in the period 2003–2013 due to high market prices. However, it was not as far
reaching as often assumed. Rather, the rise was generally of mutual benefit to governments (through rents) and compa-
nies (through profits).
Resource nationalism: a definite practice, a vague
term
The term ‘resource nationalism’(hereafter RN) refers to vari-
ous forms of state involvement in the extraction, processing
and sale of natural resources. The single most common
usage in the business press, representative organisations of
oil and mining companies and by investment advisors is in
relation to government involvement with international com-
panies operating within their national jurisdiction. The fre-
quency of the use is influenced by how prevalent it is. In
the year 2012, when the price of oil per barrel was generally
well over $100 and when one management firm (Verisk
Maplecroft, 2012) estimated that 44 per cent of global oil
production was taking place in countries where there was a
‘high or extreme risk’of RN, coverage of the practice were
commonplace. By contrast, in 2017 with oil below $50, there
is less mention of the term. While it is used in relation to
domestic politics in particular states and regions, RN is not
now posed as a generalised phenomenon of our times. This
aside, use of the term in press and industry sources and,
more recently, in academic books and articles concerned
with energy supply and law, have made the term a conven-
tional one.
Yet RN remains an ill-defined label; something with
descriptive value but little analytic purchase. The purpose of
this article is to provide clarity to policy makers and aca-
demics alike in understanding RN in a world of, on the one
hand, multiple, piecemeal, trade agreements on resources,
and, on the other, of finite raw materials, unsustainable
warming and rising populations. It does so by defining what
it is and identifying its motivations by sifting through the
more important contributions on RN, both business and aca-
demic. In doing so, the article is clear on what I take to be
the most constructive designations and drivers from the
existing literature. It is therefore a work of critical synthesis,
not originality. While there are some references to resources
other than oil, discussion is primarily about the world’s most
traded commodity. The article is organised in the following
manner. I first attempt to locate the practice and term in
©2017 University of Durham and John Wiley & Sons, Ltd. Global Policy (2017) 8:4 doi: 10.1111/1758-5899.12503
Global Policy Volume 8 . Issue 4 . November 2017
474
Research Article
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