International Finance Corporation
If developed and managed appropriately, a country’s oil, gas, and mineral resources can make a major contribution to economic development and poverty alleviation. The purpose of this paper is to contribute to the understanding and discussion of how the costs and benefits of natural resource development are shared across society. This paper presents how IFC, as both an investor and a development organization, determines whether benefits and costs are shared reasonably, and how this assessment influences IFC’s decision to invest in a particular natural resource project. Through its long experience in the sector, IFC has learned that investments likely will run into problems at some point in their life cycles if there are imbalances in the sharing of fiscal, economic, environmental, and social costs and benefits. By describing IFC’s thinking and lessons learned, the goal of the paper is to promote a broad, constructive dialogue across stakeholders— governments, investors, civil society, and others— around benefit sharing.