Pink Floyd’s Money Travels Long Way to Mongolia

Natural resources can be a boon to a nation's economy – just ask landlocked Botswana, which enjoyed tremendous growth, thanks to its diamond deposits. However, abundant minerals, gas, and oil can hinder a country's economic progress, if governments over-invest in such booming industries at the expense of building manufacturing or agricultural sectors. Without a diversified, bustling economy, a drop in prices for raw materials quickly prompts economic downturn. In a young democracy such as Mongolia's, the chances of this "Dutch disease," or resource curse, increase along with the potential for corruption. For its part, Mongolia is proceeding cautiously, too slow for investors who want immediate claims and rights secured. Mongolia’s finance officials recognize the pitfalls of fast and easy money. Ultimately, by balancing the welfare of an impoverished populace and the demands of foreign investors, Mongolia could demonstrate how to maximize benefits from a resource boom. – YaleGlobal