Oil
The rough guide to transparency and natural resource revenues
How can transparency in the oil industry be improved?
Authors:
K. Astill
Publisher:
Catholic Fund for Overseas Development , 2007
This document examines the oil industry in Africa, and provides an overview of the multistakeholder Extractive Industries Transparency Initiative (EITI) and the NGO-coalition Publish What You Pay (PWYP).
The authors argue that countries endowed with an abundance of natural resources seem unlikely candidates for chronic, deep poverty. However, the reality is different. One issue is the management of a massive influx of oil revenues poses serious challenges for any government, but especially for those without strong democratic and accountable institutions. Initiatives such as the UK led EITI attempt to deal with this situation.
The PWYP, however, believes that EITI has some serious inadequacies as t relies mainly on voluntary reporting by companies and governments and therefore unlikely to draw in countries where lack of transparency is most severe. The PWYP recommend the following:
- international Accounting Standards for extractive industry companies should include a requirement to disclose payments to governments
- revenue transparency should become a condition of all future lending and technical assistance
- it should henceforth be a standard condition for lending to governments that the recipient is transparent about its resource income and expenditure.
