sharing in governance of extractive industries
The Democratic Republic of Congo has made meaningful progress in implementing the EITI. Despite the country’s positive direction of travel in strengthening transparency, major challenges in accountability and governance remain.
The EITI Board decided today at its meeting in Addis Ababa, Ethiopia, that the Democratic Republic of Congo has made meaningful progress in implementing the EITI Standard. Recognising efforts to open up the sector and acknowledging the strong potential of the EITI to yield further impact, the Board nevertheless expressed concerns about the persistence of corruption and mismanagement, as well as broader restrictions to civic space.
“In a country where the extractive industries have consistently accounted for over 80% of exports during the last three decades, the sector’s potential for positive impact on livelihoods is immense,” commented Helen Clark, the EITI’s Board Chair. “Progress has been made in a complex environment. I would urge the Government of the DRC to carefully consider the Validation findings and the next steps it can take to continue its journey towards transparency.”
The DRC hosts some of the world’s most extensive deposits of copper, cobalt, coltan, diamonds and gold. Validation, the EITI’s quality assurance process, showed that EITI reporting has shed light on the profile and operations of the numerous companies operating in the DRC, as well as the implementation of the SICOMINES infrastructure-for-minerals deal.
Validation highlighted that the EITI has had an impact on the organisational culture of government agencies and companies, changing the way they report on their activities, payments and revenues. For example, the Ministry of Finance and the Ministry of Mines show the potential for transitioning towards the routine disclosure of data. Government agencies are encouraged to tackle challenges related to the comprehensiveness and reliability of the data they disclose through greater collaboration with supreme audit institutions and other oversight bodies. Gaps between the government’s contract disclosure policy and practice is one key area where weaknesses in sector oversight were identified by EITI stakeholders.
The DRC EITI also represents an authoritative voice on beneficial ownership transparency, in a context where discussing the link between politically-exposed persons and natural resources is often seen sensitive. EITI stakeholders succeeded in including beneficial ownership transparency provisions in the 2018 Mining Code and suggested related provisions in the oil and gas, mining and forestry sectors in a draft decree.
Although Validation did not find violations to the Civil Society Protocol in respect of civil society organisations substantially involved in the EITI, the Board expressed concerns about the wider environment in which civil society organisations operate in the Democratic Republic of Congo. Within the extractives sector, however, the Validation documented the remarkable extent of the civil society constituency’s engagement in the EITI and in extractives transparency. For example, the Congomines website, supported by the Carter Centre, constitutes alongside the DRC EITI website a rich repository of information and demonstrates how civil society actors can use the EITI to catalyse investigations into the management of sector revenues. In the DRC, the EITI has witnessed the emergence of an informed and committed local civil society, working on key issues such as mining revenues paid to provinces or the corporate governance of SOEs.
The EITI has contributed to building trust between stakeholders that have not traditionally worked together. However, a governance crisis in 2016 that led to the suspension of the former national coordinator revealed challenges in ensuring that the multi-stakeholder group (MSG) effectively carries out its mandate and operates in a transparent manner. The Board therefore encourages the DRC EITI to reconstitute the MSG, and to prioritise a robust process for the recruitment of a national coordinator and the sound management of its financial resources.
Stakeholders consulted during Validation questioned progress in bridging the gap between transparency and accountability in the management of the extractive industries. Many noted that transparency alone was not enough to ensure that the development of the DRC’s natural resources benefits the country’s citizens, despite a stated objective for the DRC EITI to “contribute to sustainable development in the DRC through the responsible and transparent management of natural resources”. The Board encouraged the new government, led by President Félix Tshisekedi, to use the EITI to help advance its anti-corruption agenda. The EITI can indeed help identify areas most prone to corruption in the sector, including opaque awards of licenses and contracts.
The decision by the EITI Board allows the DRC 18 months to carry out thirteen corrective actions. Local stakeholders including civil society actors should be at the forefront of demanding further transparency, using reliable and timely information in requesting reforms to drive positive change. The EITI Standard provides entry points to monitor key issues such as the implementation of regulation on the allocation of revenue to local communities, the contribution of the artisanal and small-scale mining sector to the economy, social and environmental investments by companies, and assessment of whether the country is signing deals in the extractives sector that benefit its citizens.
The EITI holds all implementing countries to the same global standard. During the Validation process – the EITI’s quality assurance mechanism – each implementing country is evaluated on their degree of progress in implementing the EITI Standard.
Validations are intended to provide all stakeholders with an impartial assessment of whether EITI implementation in a country is in line with the provisions of the EITI Standard. The Validation report, in addition, seeks to identify the impact of the EITI in the country being validated, the implementation of activities encouraged by the EITI Standard, lessons learnt in EITI implementation, as well as any concerns stakeholders have expressed and recommendations for future implementation of the EITI. The outcome of a Validation report is an overall assessment of Satisfactory, Meaningful, or Inadequate progress.
More information about the Validation procedure can be found on EITI’s Overview of Validation page.
This article was published on the EITI website on 16 October 2019.
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