More Countries Sign Up To Transparency Through The EITI
The rising number of governments committing to the Extractive Industries Transparency Initiative (EITI) is a sign that they are getting more serious about transparency in their mining, oil and gas industries, as well as being more proactive about weeding out corruption in the sector.
Forty-nine countries are either fully compliant or are going through the process to be part of the EITI, a global standard which promotes the open and accountable management of natural resources, mainly of oil, gas, metals and minerals, although it can extend as widely as forestry and aquaculture.
“We are certainly seeing improvements, especially in countries which we have visited several years in a row. We’re noticing that reconciliation differences are getting smaller. It’s also been easier to explain the differences,” said Tim Woodward, a partner in Moore Stephens, an accounting and consulting firm which has completed the highest number of EITI reconciliations in countries around the world.
Companies need to disclose and publish what they pay to governments, and governments will publish what they receive in an EITI report. A multi-stakeholder group of governments, companies and civil society oversee the disclosure.
Taxes, royalties, benefits in kind, and payment such as those to local government organisations, are all included in the reconciliation, says Woodward.
"In Africa, we have seen some very positive improvements in countries such as Burkina Faso, Togo and Mali, while the Democratic Republic of Congo is funding its own reconciliation, a strong indication that it is committed to the process,” said Woodward. Donors, such as the World Bank and European Union, usually pay for the reconciliation process.
Currently there are seven requirements a country needs to meet to become EITI compliant.
Moore Stephens has completed the EITI process for Nigeria, Mali, Zambia, Burkina Faso and the Democratic of Congo, while young democracy, Myanmar, has recently come on board.
"The size and scope of the Nigerian reconciliation for the EITI was large and we had a good response rate," said Woodward.
Moore Stephens is also involved in the EITI process for Zambia, the Seychelles and Ethiopia and is currently working on the reconciliation process for the UK.
“We’ve seen a wave of developed countries, such as the UK, the US, France, Germany and the Netherlands sign up for the EITI. It’s gaining traction, and countries are becoming aware that they don’t want to be left out of the process,” said Woodward. He foresees that developed countries will increasingly come on board the EITI.
When well managed, there’s far less chance of corruption and even conflict.
“It comes down to reputation – making sure people believe in a country and are willing to invest.”
The EITI is keen to point out that it wants citizens to hold their governments to account, as to what taxes they are receiving, and how they’re spending taxpayers’ money.
“It’s very fulfilling to see that we are able to make a difference in assuring people that government funds are getting to the right place,” said Woodward.
The EITI has 49 implementing countries, 44 of which have published their revenues from extractions from their country’s natural resources.