The Financial Times newspaper in London has a regular glossy magazine supplement advising its wealthier readers “How To Spend It” (presumably after they’ve earned it).

Luxury is a personal choice. I wouldn’t criticize a private consumer with means for being drawn into the lifestyle, but when it comes to public wealth, the rules are different. I reflect on how Muammar Gaddafi nationalized Libya’s oil sector after taking power in 1969 and proceeded to live a life of luxury fueled by natural resource wealth until his downfall and death in 2011. Gaddafi’s vanity is the cover story in this parody; for states lucky enough to be blessed with publicly-owned natural resources, here are a few simple rules for avoiding the curse it can bring.

Don’t spend it on yourself

This goes beyond dictators with a penchant for palaces. Norway is the bellwether for all other oil or resource rich nations to follow. The Norwegians are famously thrifty about how they spend lucrative oil profits. They choose not to increase public spending or subsidize public services (with a few exceptions like social healthcare). The Norwegians opt instead to place state resource revenues in a sovereign wealth fund that largely invests outside of Norway. It’s said that a billion dollars per week passes through the fund’s office in Oslo, and it will be worth $1 trillion by 2020, according to a BBC report published in 2013.

This strategy helps the Norwegians achieve two things: keep inflation in check by diversifying investment beyond their borders, and preserve wealth for future generations.

Don’t subsidize it

Taking another page out of the Scandinavian playbook, Norway has the most expensive petrol prices in the world despite being Europe’s largest oil producer. Instead of subsidizing petrol to make it cheaper for consumers, they tax it to support expensive maintenance of the country’s transportation network.

By comparison, Nigeria is Africa’s largest oil producer. Its government reluctantly subsidizes petrol because much of the population depends on it (with some even powering homes with personal generators that compensate for frequent blackouts). The removal of subsidies would free up billions of dollars to boost Nigeria’s economy and improve the country’s decaying infrastructure. However, once you’ve started down that slippery slope, it’s hard to come back up.

Don’t spend it on un-affordable infrastructure

Using natural resource wealth to fund major infrastructure projects is a great idea in principle, but the underlying business case for building infrastructure needs to stand on its own economic support beams. Infrastructure is an enabler, not a panacea.

The temptation with natural resource wealth is to put the proverbial infrastructure cart before the skills horse and build an Aerotropolis or entire “technology” city with the misplaced hope of attracting global businesses. Abu Dhabi’s sovereign wealth fund managers wisely chose a different strategy. Mubadala Healthcare first partnered with the Cleveland Clinic in the United States to bring healthcare expertise to the United Arab Emirates; then they built a clinic together which will open in 2015. Smart.

Don’t forget the locals

There is a wider economy to natural resource wealth, and the local community should benefit as much as possible. China’s resource-for-infrastructure deals in Africa ten years ago were great for development (in principle), but left some feeling the model was not sustainable long-term for local populations. Resources are finite—which is what makes them valuable—and sooner or later the local economy will have to thrive without them. Investing in skills and a long-term plan to deliver economic balance and diversity is as important as new roads and railway lines.

Don’t go it alone

Partnership has many advantages. International expertise is often needed to effectively develop a natural resource. Partnerships can attract foreign investment and allow some of that expertise to transfer into local firms. When ExxonMobil led an unprecedented multi-billion dollar investment into a liquefied natural gas facility in Papua New Guinea in 2010, for example, it knew the socio-economic considerations would be huge as the capital costs of developing the project were greater than the country’s gross domestic product.

Following this logic, the company consciously planned around cultural sites and set an agenda to ensure that stakeholders were consulted and compensated in an open and transparent process. The company provided employment, training, and local business development. It also contributed to health, education, and agricultural initiatives. These are essential hallmarks of a competitive, open, and transparent marketplace.

Natural resource opportunities are a stepping stone for further private investment into other infrastructure sectors helping nations tackle the broader transportation, energy, and water challenges they may face. Get them right, and governments won’t have to worry about how they spend their wealth. They can invest confidently, knowing that future generations will benefit from their foresight.

Now that’s luxury.