Oil Boom: Peril or Opportunity? Sub-Saharan Africa is in the midst of an oil boom as foreign energy companies pour billions of dollars into the region for the exploration and production of petroleum. African governments, in turn, are receiving billions of dollars in revenue from this boom. Oil production on the continent is set to double by the end of the decade and the United States will soon be importing 25 percent of its petroleum from the region. Over $50 billion, the largest investment in African history, will be spent on African oil fields by the end of the decade.

The new African oil boom -- centered on the oil-rich Atlantic waters of the Gulf of Guinea, from Nigeria to Angola -- is a moment of great opportunity and great peril for countries beset by wide-scale poverty. On the one hand, revenues available for poverty reduction are huge; Catholic Relief Services (CRS) conservatively estimates that sub-Saharan African governments will receive over $200 billion in oil revenues over the next decade. On the other hand, the dramatic development failures that have characterized most other oil-dependent countries warn that petrodollars have not helped developing countries to reduce poverty; in many cases, they have actually exacerbated it.

Africa's oil boom comes at a time when foreign aid to Africa from industrialized countries is falling and being replaced by an emphasis from donor nations on trade as a means for African countries to escape poverty. The dominance of oil and mining in Africa's trade relationships, coupled with this decline in aid flows, means that it is especially vital that Africa make the best use of its oil.

CRS is committed to helping to ensure that Africa's oil boom improves the lives of the poor through increased investment in education, health, water, roads, agriculture and other vital necessities. But for this to occur, these revenues must be well managed. Thus, this report addresses two fundamental questions: How can Africa's oil boom contribute to alleviating poverty? What policy changes should be implemented to promote the management and allocation of oil revenues in a way that will benefit ordinary Africans?

For the past several decades, the conventional - and, until recently, the predominant - perspective on development in the international donor community has been that countries are poor because they lack resources, infrastructure, education, and opportunity. By this logic, if rich countries could only transfer enough resources and technology, improve human capacity enough, and support health and education enough, development would occur. To be sure, greater public resources, better physical infrastructure, and stronger public health and education are essential for development. But they are not enough, and they are not most crucial factor.

President George W. Bush has demonstrated impressive flexibility in reshaping his approach to foreign policy to deal with the new international challenges brought to the fore by the terrorist attacks.

Before Sept. 11, President Bush embraced a humble mission for the United States in the world. This country, he believed, had to "preserve the peace" by seeking to maintain the basic balance of power between nations. Now, Bush has abandoned the preservation of the old system. Instead, he seeks to change it by promoting liberty, freedom and eventual democracy in countries ruled by autocrats.

In doing so, Bush lines up next to "idealists" or "liberals" such as Ronald Reagan, Woodrow Wilson and Immanuel Kant, and implicitly distances himself from realists focused solely on the balance of power such as Richard Nixon, Thucydides and his own father, the 41st president.

In a second remarkable change, Bush has become a supporter, at least rhetorically, of nation building. Before Sept. 11, the Bush administration derided nation building as a Clinton-era distraction from the more important issues in international politics. Now, Bush has clearly identified the connection between rebuilding the failed state of Afghanistan and American national security interests. If Congress approves his proposals, Bush will be the author of the greatest increase in the American foreign aid budget since John F. Kennedy's presidency.

Third, the Bush administration before Sept. 11 expressed disdain for multilateral institutions. But in his speech this month before the United Nations, Bush outlined an ambitious proposal for revitalizing the United Nations and American cooperation with this most important multilateral institution.

To be credible, President Bush needs to do more to demonstrate his commitment to the promotion of democracy, nation building and multilateralism. Bush must show that he wants to see political reform in Saudi Arabia as well as in Iraq. Words about promoting liberty ring hollow if they apply only to some people.

To show seriousness on nation building, Bush should press for increases in the peacekeeping forces in Afghanistan. Those working to rebuild Afghanistan unanimously complain that the lack of security throughout the country is the No. 1 impediment to their work.

To make credible his pledge to reinvigorate the United Nations and other multilateral institutions, the president should complement his pledge to enforce U.N. resolutions on Iraq with a rededication of American participation in other international regimes. Bush could start with the ratification of the United Nations Convention on the Elimination of All Forms of Discrimination Against Women, an agreement that American officials helped craft.

Because many are suspicious of the president's recent embrace of democracy promotion, nation building and multilateralism, he must demonstrate a sustained commitment to his new foreign policy strategy.

If Bush has shown a willingness to consider new ideas about foreign policy, his critics -- both at home and abroad -- have demonstrated amazing conservatism. In a reversal of positions, those most opposed to Bush's new approach to foreign policy now seek to "preserve the peace" by defending the status quo. The core flaw in this is the assumption that the old international system was working. It was not.

Before Sept. 11, the United Nations had failed to enforce its own resolutions on Iraq. If the "international community" cannot act to execute its will when dealing with such grave issues as the proliferation of weapons of mass destruction, then it has no credibility on anything.

The international community is ineffective in dealing with despotism, poverty and human rights violations because it seeks to preserve state sovereignty above all else. Fifty years ago, this was a progressive idea, which brought about the end of colonialism. Today, it is a regressive idea, which preserves the sovereignty of dictators who defy international law, denying the sovereignty of their people.

It is odd to hear the international community invoked so often as the defender of high ideals and then see representatives from Iraq in the U.N. General Assembly. Should the United States really be a member of the same organization that includes Saddam Hussein? Eventually, autocracy should go the way of slavery and colonialism as simply unacceptable.

To be effective, the international community and the United States need each other. U.N. Security Council resolutions can only be enforced if the United States helps to enforce them. The United Nations can only assist in the building of new states or prevent the destruction of vulnerable regimes if the United States participates, and vice-versa. The international community has no army and no economy, but even the mighty and rich United States can't afford to remake the world alone. For an effective partnership, change has to come from both sides.

Michael McFaul is an associate professor of political science and Hoover Fellow at Stanford University and a senior associate at the Carnegie Endowment for International Peace.