Mission improbable: Does petroleum-related aid address the resource curse?

Petroleum-related aid programmes and projects are a key part of donor activities in oil-rich developing countries. This paper critically assesses petroleum-related aid activities, using the Norwegian Oil for Development programme as a main case. Recent research suggests that institutions, or governance, are essential in averting a resource curse. While governance issues are beginning to receive more attention in these types of programmes, they still form a minor part of programme activities. The narrow sector focus that characterizes petroleum-related aid makes it unlikely that it will produce the higher order institutional changes needed to lift the resource curse. Petroleum-related aid activities address the issue of corruption only to a limited extent. Given the commercial and political interests of donor countries, questions about the integrity and credibility of these types of programmes can be raised.