Do Economic Sanctions Lead to Change in Mining Taxation?

Economic sanctions have become one of the main instruments of international pressure. Since the 2000s, their use has intensified, targeting, among others, countries rich in natural resources. A country subject to sanctions often faces difficulties in attracting foreign investors and financing its economy. To maintain the country’s attractiveness for natural resource extraction, it may therefore be tempted to change its tax policy, particularly by reducing the taxes and levies imposed on multinational corporations exploiting its natural resources.

Our study, published in The World Economy, examines this question using data covering 20 African countries and 75 developing countries between 2000 and 2020. It investigates whether economic and financial sanctions lead governments to change their tax policies and assesses the consequences of these decisions for rent sharing; that is, the distribution of the net revenues generated by natural resource extraction between the government and private companies.

To address this question, we use spatial econometric methods and distinguish between two dimensions. The first concerns changes introduced into law (“de jure”), namely legal tax reforms that are expected to affect the sharing of resource rents. The second concerns changes actually observed in rent sharing (“de facto”). In practice, a tax reform does not always alter the de facto distribution of resource rents. Its effects may be limited by fiscal stability clauses, long-term contracts protecting investors, or tax-planning strategies implemented by multinational corporations.

Read the blog article in French

Published article reference

Amedanou, I., Laporte, B., Ouédraogo, M., & Rouamba, B. J. (2026). Economic Sanctions and Taxation of Natural Resource Rent: Evidence From Spatial Analysis. The World Economy, 1–49.