Despite rational thinking suggesting that a country rich in resources should have higher
socioeconomic growth and development,the results of many resource rich countries have not
been encouraging. This phenomenon has been studied widely and has been termed the
resource curse and denotes how a country with abundant natural resources tends to have
lower economic growth and generally display poorer development levels than countries with
fewer natural resources.
The Sovereign Wealth Fund (SWF) has been proposed by the International Monetary Fund
(IMF) as a tool to curb the resource curse and many resource rich countries have recently
started SWFs. The recent activity of SWFs has sparked a lot of interest in this topic but most of
the studies conducted to date have failed to determine the effect of the SWF on a country’s
socioeconomic development and on its ability to mitigate the resource curse.
This research is unique in that it establishes the impact of the creation of a SWF on the
socioeconomic performance of resource rich countries by examining the Human Development
Index of these countries. In addition,the research examines the key success factors of a SWF
and establishes a framework that can be used to ensure that the SWF is effective.
The study has found that the establishment of a SWF is not a guarantee of success and that
governance is the most significant success factor in a SWFs effectiveness. As a result, the SWF
is proposed as one solution to the resource curse and a SWF framework is presented with
governance as a key success factor.
This research is particularly relevant to the resource dependent economies of Africa that have
lagged the rest of the world in many socioeconomic measures such as the Human
Development Index and income inequality. The effective deployment of a SWF is one option
that these economies can utilise to!ensure that their resource riches are translated into
socioeconomic development. / Dissertation (MBA)--University of Pretoria, 2013. / zkgibs2014 / Gordon Institute of Business Science (GIBS) / MBA / Unrestricted
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:up/oai:repository.up.ac.za:2263/41989 |
| Date | January 2013 |
| Creators | Rajan, Julien Joseph |
| Contributors | Lamprecht, Johan, ichelp@gibs.co.za |
| Source Sets | South African National ETD Portal |
| Language | English |
| Detected Language | English |
| Type | Mini Dissertation |
| Rights | © 2014 University of Pretoria. All rights reserved. The copyright in this work vests in the University of Pretoria. No part of this work may be reproduced or transmitted in any form or by any means, without the prior written permission of the University of Pretoria. |
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