Huge quantities of natural gas have discovered in Tanzania and Mozambique in the year 2010 and 2014.
As per today, Mozambique ntural gas assets reach at 100 TCF (trillion cubic feet ). Meanwhile, Tanzania estimated 57 TCF (Trillion cubic feet) of natural gas.
And according to the US Geological Survey, the country still has potential natural gas reserves up to 441 trillion cubic feet solely in the coastal region, so more gas discovery might be forthcoming.
But the huge reserves will be worthless if East African countries won’t transform the rich brought by oil and gas and gas resources into economic and social development.
A report from the Brookings Institution’s Africa Growth Initiative (AGI) point out that Tanzania has potential to generate US$ 2.5 billion per year in government revenues from the gas sector.
The world bank foresees the revenue generated from the sources in Mozambique will reach $ 9 billion in 2032.
Natural resources are prosperity when they used to promote social and economic development.
The Modern Dubai
The oil wealth has transformed countries such as Norway and United Arab Emirates (UAE). These countries had few resources. Since the oil discoveries, the economies of these countries are booming.
United Arab Emirates (UAE) has transformed from the small desert to modern state with the high living standard. As per today, Dubai is a center of trade and tourism which attract millions of tourists a year.
The countries have reached such height because they transform oil wealth into another sector of the economy .
East African countries can look up to Dubai and follow in its footsteps.
many resources rich countries have turned resources into a curse. For example, Nigeria learned the hard way in Niger Delta. Resources curse is the situation a country with an enormous natural resource has poor economic development than the country without.
This mistake shouldn’t repeat in East Africa. The use of Sovereign Wealth Funds (SWFs) can be a better way of managing oil and gas revenue.