International
Corruption
Europe proposes new transparency law to fight corruption
The campaign for transparency in the oil, gas, mining and forestry industries was given a big boost today with the publication of European Commission proposals for a new law guaranteeing all company payments to governments will be published. This country-by-country and project-by-project reporting will give citizens the information they need to hold their leaders and companies accountable. ONE and the Publish What You Pay coalition have been working hard for this change and have warmly welcomed the proposed law.
ONE’s co-founder Bono had this to say on the move:
“This is a serious step forward by Barroso and Barnier, who have thrown their weight behind the fight by the citizens of poor countries to ensure their natural resource wealth turns into actual wealth for the people – and doesn’t line the pockets of dodgy dictators or distant exploiters. The next step is when the great activist himself, Bill Gates Jnr, presents the case for these legally binding measures to the world leaders of the G20, along with other historic proposals on financing the fight against poverty.”
Our Brussels Director Eloise Todd explains what needs to happen next to get the proposed law onto the statute books:
“President Barroso and Commissioner Barnier have shown real leadership. It is now the responsibility of the Council of Ministers and the European Parliament to ensure that these proposals are implemented in full, which we trust will happen given the strong support from the French, British and the European Parliament. In some areas we will look to the Council and Parliament to tighten up the regulation, for example in removing the exemption for countries that would rather keep information secret. It is also essential that the provisions on project-level disclosure are strengthened. The murky deals between extractive companies and despots must become a thing of the past. The EU and its companies will now have to decide which side of history they want to be on.”
The issue of extractive industry transparency is crucial for development prospects in Africa. Huge flows of money are coming into the continent for natural resources ($246 billion in 2009) and yet far too much of it is not being spent on reducing poverty and strengthening public services. Transparency over individual projects gives citizens and activists the information they need to hold their governments accountable for money coming in.
The move by Europe complements ONE’s campaign for section 1504 of the US Dodd-Frank Act which ensures all US listed extractive industry companies will shortly be publishing their payments to governments. We are now moving towards a global standard of mandatory transparency, which was endorsed by the G8 and we hope to see progress on at the G20 next week.
Now for Action: Governments make commitments to openness, transparency and accountability
At 7.00 New York time, Brazil, Indonesia, Mexico, Norway, the Philippines, South Africa, the UK and the USA – the countries on the steering committee of the Open Government Partnership – published their Action Plans. They contain a wide range of exciting measures to enhance transparency and accountability and to make governments more open and responsive to their citizens. Efforts to tackle corruption feature heavily in many of the plans, including those of Brazil, Indonesia, Mexico and South Africa. Initiatives to enhance budget transparency and to improve the delivery of public services feature in the plans of Brazil, Indonesia, the Philippines and South Africa. And welcome moves to enhance aid transparency feature in the plans of the UK and the USA. On transparency about natural resource revenues, Norway has signalled a commitment to consider passing legislation that would require multinationals to publish tax information on a country by country basis. And by signing up to the Extractive Industries Transparency Initiative, the USA has continued the leadership it showed last year in passing legislation on extractives transparency.
The Open Government Partnership (OGP) looks set to be an important forum for sharing experience, encouraging and assisting governments to become more open. Africa’s involvement is currently limited with just three African countries – Ghana, Kenya and Tanzania – joining South Africa within the OGP. However, the partnership has great relevance for Africa and for ONE: the ability of African citizens to hold their governments to account is shaped by the actions of the USA, the EU and other countries that provide aid to Africa and whose companies operate in Africa; African governments can share experience with other emerging economies as regards transparency and accountability; and, over time, we hope that many more African countries will choose to take the path towards more open, transparent and accountable government.
We know that in 2012, Brazil will continue to lead the way on the open government agenda, hosting meetings of the Open Government Partnership, the Global Initiative on Fiscal Transparency and the International Anti-Corruption Conference, and perhaps joining with the USA in requiring its oil companies to publish what they pay to the governments of the countries where they operate. And we trust that Mexico will pick up the baton of transparency and accountability as it takes over the leadership of the G20 from France.
For ONE’s introduction to OGP and a link to our policy pitch see here.
Or check out ONE’s full analysis of the Country Action Plans from a development perspective
Opening Government to Accelerate Poverty Reduction
By shining a light on the ways in which governments in developing countries invest aid, natural resource revenues and other public resources, transparency can turbo-charge accountability, helping ordinary citizens to hold their governments to account. This can play an important role in reducing corruption, improving the delivery of essential public services such as health and education, enhancing the climate for growth and investment, and accelerating countries’ progress along the road out of poverty, towards prosperity and beyond aid dependence.
Transparency and accountability provide, in effect, a boost to the quantity and quality of resources available for development. To maximise this “resource dividend” it is essential that there is transparency and accountability for the use of all public resources, including aid, climate finance, taxes, and natural resource revenues, and that budget processes are open, with room for citizen engagement. The Open Government Partnership (OGP) – to be launched today (Tuesday 20th September) by President Obama of the United States and President Dilma Rousseff of Brazil – provides an important opportunity for governments to take a real step forward in enhancing transparency and accountability for the use of all public resources.
(OGP logo)
OGP is a new international initiative which aims to encourage and enable governments, in partnership with civil society, to promote transparency, increase civic participation, fight corruption, and harness new technologies to strengthen governance. By taking advantage of this moment of opportunity, governments can empower citizens with the information that they need to take greater control of their own development and make an important contribution to accelerating progress on poverty reduction.
At the OGP launch, the founding governments – Brazil, Indonesia, Mexico, Norway, Philippines, South Africa, United Kingdom, and the United States – will endorse an Open Government Declaration and announce national action plans. The founding governments will also be joined by another 38 governments, including Ghana, Kenya and Tanzania, who will commit to developing and delivering their action plans at a follow up meeting in March 2012 in Brazil. The official launch of OGP event will be live streamed at www.whitehouse.gov/live
As well as participating in the launch, we will be analysing countries’ action plans to assess whether governments’ commitments – on aid, on budgets and on natural resource revenues – will empower people in developing countries with the information they need to hold governments to account. See our recent policy pitch for more information about the commitments that we believe governments should make to promote the transparent and accountable use of public resources. Over the coming months and years we will be working closely with a number of partner organisations to build a global movement on transparency and accountability, to keep transparency and accountability high on the agenda at the G20, the Fourth High Level Forum on Aid Effectiveness in 2011, and in meetings of the G8 (US), G20 (Mexico) and the International Anti-Corruption Conference (Brazil) in 2012, and to make sure that governments meet their commitments to become more open.
Transparency alone will not deliver the accountability that is needed to ensure that resources are invested effectively in poverty reduction. Politics is key. But without transparency, political choices are poorly informed and there can be no accountability. With the demands of people across the Arab world for better governance fresh in our minds, now is the time to open government in order to accelerate progress on poverty reduction.
European Parliament pushes for extractives transparency
Political momentum increased yesterday for a new transparency law in Europe that would help citizens in poor, but resource-rich, countries. The European Parliament endorsed plans for an EU-wide transparency law to shed light on the payments oil, gas and mining companies make to the governments where they operate. This would empower citizens with the information they need to hold their leaders accountable for money received, and would help governments negotiate fairer deals with extractive industry companies. In both these ways efficiency of public finance would improve, and more resources could be allocated to vital development projects.
(photo from PublishWhatYouPay.org)
ONE is a strong supporter of this type of transparency, and is part of the Publish What You Pay coalition which includes over 600 civil society organisations from around the world. For example we worked with Ugandan activists earlier in the year to deliver the message that the UK can help them make sure their new-found oil wealth is not wasted. Over the last few days Publish What You Pay has been asking people on Twitter what they would do with greater control of their #oilmoney. Education, healthcare and environmental projects were listed as priorities.
Moves towards legally binding measure in the EU will help with this. Jean Claude Katende of Publish What You Pay in the Democratic Republic of Congo argues: “We want to see the European Union adopt rules which are as ambitious as possible. Payment information will help us hold our leaders to account, but other information on profits, sales, production levels and reserves would enable us to judge whether DRC is getting a fair deal for the exploitation of its mineral resources.”
Last July the US passed a law that will soon mean all oil, gas and mining companies listed in America will have to publish their payments at the level of individual projects on an annual basis. Europe will soon propose a similar law. We need both jurisdictions to move swiftly to implementing these laws so that activists in Africa get the revenue information they need as soon as possible.
The end goal of better accountability in this area of public finances is to ensure resources are invested well, including in health and education, so that poor countries’ reduce poverty and progress towards middle-income status.
Make Aid Transparent
Today, our friends at Publish What You Fund launched the Make Aid Transparent Campaign, which calls on aid donors to publish information on what they are doing with their development aid. ONE has joined the coalition of more than 50 civil society groups from over 20 countries around the world to call on donors to be more transparent on where, when and how they spend their aid budgets.
ONE has been campaigning on improving the impacts of effectiveness through better transparency of aid data for some time. We believe aid money should be well spent, and any scope for corruption and inefficiency stamped out. One of the best ways to do this doesn’t cost a thing: transparency. This helps us know more about how our taxes are being spent, but more importantly making the information available can also help the citizens of developing countries know how much their governments are receiving and can push for it to be spent it in ways that really meet their needs.
This Make Aid Transparent Campaign targets all donors as they prepare for a major international conference on Aid effectiveness in Busan, South Korea in November. If you’d like to know more about why aid transparency is important visit the campaign website, where you’ll find the petition aimed at donor governments. So please register your support!
UK Chancellor responds to ONE members’ call
Together as ONE we have done it again.
Over the last few weeks ONE members have been asking the UK Chancellor, George Osborne, to make a public statement in support of laws across the EU that will require big oil, gas and other extractive companies to declare exactly how much they are paying developing country governments. Almost 10,000 ONE members signed up, and the petition was delivered to Downing Street by ONE member Nicky Minford (right).
Working together, we have helped to make important progress.
Last year, thanks to work from ONE, the “Publish What You Pay” campaign, and many others in the US, we successfully pressured the US Congress to pass a law on this issue. Since then we have been encouraging the UK Government to support a similar law across the EU. Mr Osborne has since responded with this public statement:
“As we enter a new decade when the resources of Africa are going to be heavily developed, I strongly believe it’s in everyone’s interests that mining companies and others operate to the highest standards. That’s the way to ensure some of the world’s poorest benefit from the wealth that lies in the ground beneath them. That’s why I’ve raised the issue of new international rules at the G20 in Paris – the first time that’s happened. And that’s why Vince Cable and I will be arguing for an European agreement that matches the new standards just set in the US.”
Thank you for playing your part! This is a fantastic first step, but the battle isn’t over yet. The next stage will be later this year when the EU has an opportunity to introduce legally-binding measures to make this a reality. ONE will be working as part of the Publish What You Pay coalition to make sure that Mr Osborne’s words are turned into concrete action.
Thanks to your support we are even closer to ending the resource curse.
Getting Extractive industry transparency legislation in Europe
In July 2010, the United States passed the Dodd-Frank Act, which included a crucial provision requiring extractive industry companies to publish the payments they make to governments of the countries in which they operate. Since then, ONE has been working with the Publish What You Pay coalition to try and push other G20 countries to adopt similar legislation that goes at least as far .
In recent weeks there have been a number of important developments within the European Union with many government officials going on the record to support legally binding measures:
- In January, in an open letter to ONE’s co-founder Bono, French President Nicolas Sarkozy stated that he will ask the European Union to adopt, as speedily as possible, legislation. Then in February he repeated his support when addressed the Africa Progress Panel in Ethiopia.
- On 20 February the Guardian and Observer newspapers reported that the UK Government would back a ‘publish what you pay’ rule at EU level for oil, gas and mining firms and push this within the G20 meetings. Although we still await a public announcement of UK Ministerial support.
- Backbench UK MP Anas Sarwar (with cross party support) proposed a 10 minute Rule Bill to get a UK extractive transparency law into the parliamentary legislative calendar. It passed easily and will now begin the legislative process.
- German politicians also made positive sounds on the issue at a ONE event in Germany in January.
- The potential for EU law was discussed in detail at the Extractive Industries Transparency Initiative (EITI) Conference in Paris last week. ONE, along with follow Publish What You Pay coalition members, attended the conference, which saw Oxford economist and friend of ONE Paul Collier, American Philanthropist George Soros and African entrepreneur (and ONE Board member) Mo Ibrahim; all state their public support for such a law.
- Also at the EITI Conference civil servants from Germany, France, the UK and European Commission all reiterated their countries’ support for legally binding measures at the EU level.
Oil, gas and mining companies listed on European Union stock exchanges are valued at over €2 trillion, making the EUn the second largest home of extraction industry listed companies in the world. For this reason it is critical that the EU passes transparency legislation. The last few weeks have seen major developments in the campaign for extractive industry transparency, however there is still much to do. We now need Government Ministers from across Europe need to come out in public support of such legislation
The European Commission will make suggestions on what a transparency law could look like later in the year. It is important that these recommendations are as strong as possible. To be most effective the recommendations should not be limited to asking for only the most basic level of payments to recipient countries to be reported. To ensure this is not the case government and civil society support will be very important. As such we will continue to rely on your support in helping ensure the best possible legislation comes about.
Why transparency in the extractive industries matters for women
Each year around the world, International Women’s Day is celebrated on March 8, with thousands of events occurring not just on this day, but throughout March to mark the economic, political and social achievements of women.
As the world marks this special day ONE spoke to Winnie Ngabiirwe, Chairperson of Publish What You Pay Uganda and Executive Director of Global Rights Alert, on why transparency in the extractives industries will benefit women in Uganda and other countries.
Winnie leads the effort to make sure revenues received for Uganda’s recently discovered oil are not wasted, and are put towards social and economic development programmes.
As Winnie says:
“Once governments disclose how much they are receiving from oil and mining companies it creates a conducive environment for debate in which women’s issues can be put into consideration. And that debate can translate into beneficial investments in sectors like health and education… so if investments of the monies that come from the extractive industry are invested wisely then the status of women will improve.”
Find out more about International Women’s Day and sign our petition to the UK Chancellor, George Osborne, asking him to support laws that will require oil, gas and other extractive companies to declare exactly how much they are paying foreign governments.
Dictator’s son considers spending $380 million on a … yacht
When a government minister on an official salary of $6,799 a month commissions plans for a super-yacht worth $380 million, there are bound to be questions asked over where the money is coming from. When that minister happens to be the son of a notorious dictator in one of Africa’s most oil dependent countries, it fits an unfortunate pattern that links embezzlement with natural resource revenue.
In Equatorial Guinea, the rich live very well indeed. However most of the population still lives in poverty and one-fifth of children die before their fifth birthday. In a country with huge oil deposits the inequality is sickening. Indeed the yacht Teodorin Obiang made plans for costs more than the combined spending on health and education in the country.
It is situations like this that sparked into ONE into action on promoting transparency in the extractive industries. We want all payments made to resource-rich countries from companies to be published, so that local activists can hold their governments accountable for revenue received. The US passed a law along these lines last July, and now we are asking European governments to follow suit. Transparency in itself is not the whole answer, but it is a crucial first step towards empowering the brave citizens who stand up to corruption with the information they need. In that way, we can move towards a world where it is much harder for the Obiangs and Gaddafis to secretly use their country’s natural resources for their own enrichment.
UK MPs show their support for transparency legislation in the extractive industries
Yesterday at a little before 5.30pm Anas Sarwar ( MP for Glasgow Central) delivered a ten minute rule Bill to members of the UK government. In this statement to Parliament he outlined a proposal for a law requiring oil, gas and mining companies to publish how much they pay to all governments on a project by project and country by country basis.
The value of oil, gas and mineral exports from African countries is estimated to be nearly 9 times the value of international aid to the continent. However at the moment there is a major lack of transparency in how much money these companies pay to government officials. Unfortunately this means that sometimes officials misuse and misappropriate the money they receive, instead of using it to reduce poverty and benefit all citizens.
Often civil societies, and individual MPs within governments, are unaware of how much funding their government is receiving in exchange for natural resources. Without this information it is hard for groups to hold their governments to account for the spending of this finance and ensure it isn’t misallocated. However with this knowledge they could be greatly assisted in being able to monitor funds to ensure that all the money received is spent accountably, and used in the interest of all citizens. For Example by putting more children in school, more nurses in clinics, and getting farmers better seeds and training so they can grow enough food to feed their families and earn some money to support them. Due to the immense scale of gas, oil and mining export payments this transparency legislation could lead to huge developmental benefits.
For a number of years, a global network of organisations called Publish What You Pay (PWYP) has been campaigning for this type of legislation and real momentum is building this year to get this information made public. Last year the United States passed a law requiring companies listed on the New York Stock Exchange to publish what they pay other governments, and France’s President Sarkozy recently declared his support for similar legislation across the EU for European Stock exchange listed countries.
Last week we asked ONE members in the UK to sign a petition asking the UK Chancellor of the Exchequer, George Osborne,to make a public statement in support of such a law. With support from members of the PWYP coalition over 9000 people have already signed. This action was referenced by Mr Sarwar in his speech in which he also highlighted the benefits to business, investors, governments and civil society the legislation could bring.
When it was time to vote on the bill it passed without anyone voicing an opinion against it.
Mr Sarwar and his bill co-sponsors from all 3 major UK parties will now begin drafting a legal bill on the topic for the house to consider, in what are the first steps towards getting a UK law on the issue. However we still await a clear public statement from the UK Chancellor in support of legislation.
If you haven’t already signed the petition asking for George Osborne to make a public statement in support of the legislation you can do so here.
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The International ONE Blog is a daily log of the anti-poverty movement. The site is operated by ONE staff, with guest contributions from ONE volunteers, members and allies.
The content of each post and each comment represents the views of that author and does not necessarily reflect the views of ONE. ONE does not support or oppose any candidate for elected office, and any post expressing support or opposition for a candidate is not endorsed by ONE.
TAGS: Africa, Bono, Corruption, Policy News, Transparency