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Mining Boom, Economic Growth and Sustainable Development in Democratic Republic of the Congo

Murhula K., Pacifique and Achiza N., Alain (2021): Mining Boom, Economic Growth and Sustainable Development in Democratic Republic of the Congo.

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Abstract

This paper intends to analyze the relationship between mining boom and economic growth and on the other hand the relationship between mining boom and sustainable development in a country potentially furnished of various mineral resources, the DRCongo. To achieve these two goals, we estimate an Autoregressive Distributed Lag (ARDL) Model on Congolese data from 2005 to 2018 for two main equations respectively. From estimations, our findings show that the mineral rent, taken as mining boom proxy negatively impacts on GDP per capita as well as in the long and short run implicating a non-inclusive growth stemming from mining sector. On the other hand, mining boom has a significant and negative effect on sustainable development with a coefficient value of -3.18 and -1 at the long and short run respectively) and this impact is more marked in the long term. This is because a unit of mineral resources exploited today is no longer available for future generations; which reduces their right to enjoy the resources that the country once had. Otherwise, Adjusted Net Saving has been find negative between 2005 and 2018 with an average of -10,16% revealing that the DRCongo is not sustainable.

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