sharing in governance of extractive industries
By Elisa Peter, Executive Director, Publish What You Pay. Originally posted on Huffington Post.
9 December marks the UN’s “anti-corruption day”. What is there to celebrate and lament in 2017, and have we finally ‘drained the swamp’?
A slogan that helped carry Donald Trump to the White House sent a message that opaque dealings, lobbyists and contractors have a parasitic role in the democratic process that would no longer persist. Yet for the sectors where corruption does the worst damage to the economy, like oil, mining and other extractive industries, the Trump administration took mere days to give ‘the swamp’ a blank cheque.
We were only in January, and it looked like this year would hurl us backwards.
In the US, a significant delay to mandatory disclosure
The law in question, the Cardin-Lugar provision (also known as Section 1504 of the Dodd-Frank Act), is a bipartisan effort to protect US citizens and shareholders from millions, if not billions, of their dollars going to foreign oligarchs in secretive payments. This has been an especially common practice in the oil, gas and mining sectors. A lobbying body called the American Petroleum Institute (API) and one of its main backers, ExxonMobil - whose former CEO, Rex Tillerson, is now President Donald Trump’s Secretary of State - spent years fighting and stalling this law. In one of its very first actions, the Trump Administration granted them their wish, and sent the rule implementing the provision back to the drawing board.
More clouds ahead: trouble at the EITI
Fast forward to last month, and the Trump administration continues to undermine anti-corruption measures in the oil, gas and mineral sectors.
The Extractive Industries Transparency Initiative (EITI), the world’s principal forum and standard for the good governance of extractive resources, has also faced a difficult year, not least when the United States announced it would withdraw from the initiative. The reason cited was that “[the] EITI does not fully account for the U.S. legal framework”, a claim challenged by our US members.
Even more concerning, in March the EITI Board suspended Azerbaijan - the first country to be deemed compliant under the EITI Standard in 2009 - for failing to protect its independent civil society. While regrettable, this decision was the last resort for the EITI to uphold its principles and its Civil Society Protocol. The EITI expects governments to allow a meaningful space for civil society groups to monitor the country’s natural resources and revenues. Following suspension, Azerbaijan left the body.
Niger, the world’s fourth largest uranium producer, also left the initiative, following suspension because of its lack of demonstrable commitment to the EITI. It also failed to guarantee a healthy environment for democratic debate, and arrested one of Niger’s civil society representatives at the EITI, Ali Idrissa. Mr Idrissa is also coordinator of PWYP Niger. Months later, three more of our members were arrested, days before Niger’s EITI validation. While they have since been released, their NGO was dissolved this month by the Minister of the Interior. PWYP continues to put pressure on the Government of Niger to uphold its commitments to basic freedoms and good governance of its extractive sector.
Reasons for being optimistic
These setbacks are unfortunate. But I am just as struck by the bigger picture: despite these setbacks, extractive transparency continues to make unstoppable progress. The EITI has shed light on some 2.28 trillion dollars of government extractives revenues over the past few years. Almost half of the world’s largest extractive companies now report their payments to governments, including Chinese and Russian firms. These account to another 300 billions of dollars that have passed a crucial corruption test. And more and more contracts and licenses that detail terms of resource exploitation are being published.
Another step forward for transparency in 2017, of course, were the Paradise Papers. As often nowadays, a group of investigative journalists blew open the many ways the businesses we monitor try to hide how - and where - their money moves. We learned even more about a well-known blind spot in extractive transparency: the role of commodity traders such as Glencore, whose suspicious dealings in the DRC were revealed by the Paradise Papers. (For more on the problems posed by commodity trading, see my recent blog).
Nothing can stop the push towards transparency
I traveled to a dozen countries this year to meet PWYP members. Their courage and resilience is breathtaking.
In Tajikistan, I met female heads of households successfully influencing decisions about gold mining in the Pamir mountains. In the Philippines, I met indigenous people taking on the mining industry - often at great personal cost - to challenge industry leaders. In Zambia, at the PWYP Africa Conference, activists from around the continent told me how they used the EITI standard to promote transparency in oil and gas revenues. In Colombia, PWYP members are using transparency tools to shed light on the social and environmental impacts of mining, and are involving communities in new and powerful ways.
In the UK, my host country, transparency champions continue to pressure the government to keep the momentum to improve oil and mining disclosure.
These stories tell me that our movement is winning where it matters in the long run: where communities care deeply and stand most to gain from their oil, gas and minerals. PWYP will continue to amplify their voices and ensure that these trillion-dollar industries grow more transparent each day.
Another year ends. Some corruption was prevented. Some was discovered. Secretive business lobbies - some might call it the swamp - continue to fight back. And countless more communities, activists, journalists, experts, and business and political leaders reject the status quo. They choose to stand on the side of transparency. I am proud to stand with them.
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