Abstract:
This study aims to estimate and analyze the impact of the extractive industry of natural
resources on the economic growth of SADC countries. To achieve this goal, two models of
economic growth were estimated using panel data from 11 SADC countries. The main
results of the study indicate that: (i) SADC countries do not tend towards convergence; (ii)
during the period of this study, the total extractive industry and the extractive oil industry
had a positive and statistically significant impact on the economic growth of the SADC
countries, while the extractive forestry, natural gas, ore and metals and coal industries had
no impact; (iii) at the long-term (LT) the total extractive industry has had a positive and
significant impact on the economic growth of SADC countries, while the forestry extractive
industries, natural gas and ores and metals had a negative and significant impact on
economic growth. Furthermore, at the LT, the oil extractive industry and the coal extractive
industry had no impact on the economic growth of the SADC countries; in the short-term
(ST) the forestry extractive industry had a negative and significant impact on the economic
growth of the SADC countries, while the other extractive industries had no impact and; (v)
the total extractive, forestry, natural gas and coal industries have had a negative but
negligible impact on mozambique's economic growth at ST. In turn, the oil extractive
industry and the extractive ore and metals industry have had a positive but negligible
impact on Mozambique's economic growth at the ST. In turn, the oil extractive industry and
the extractive ore and metals industry have had a positive but negligible impact on
mozambique's economic growth and the ST. Based on the above results, the study's key
conclusion is that extractive industries have different impacts on economic growth. In
Mozambique every type of extractive industry has no impact on economic growth. The
study recommends policy coordination between SADC countries with a view to achieving
convergence. To improve the contribution of the extractive industry to economic growth,
the study recommends increasing the allocation of extractive industry rents into
economically efficient investments. However, in case, in the light of these investments, it is
recommended to improve the quality of the institutions.
