Transparency and Accountability In Africa’s Extractive Industries: The Role of The Legislature
2007
Shari Bryan and Barrie Hofmann
National Democratic Institute for International Affairs
Revenues from oil, gas and mining should spur economic growth and social development in developing countries. In practice, however, economies that are overly dependent on oil and mineral wealth have often encouraged authoritarian rather than democratic forms of governance, particularly in countries with weak legal or regulatory frameworks. Profits from natural resources allow ruling elites to consolidate power through patronage systems, while revenue mismanagement may fuel devastating spirals of corruption, conflict and poverty. Competition for control over natural resources has led to armed conflict in Nigeria, the Democratic Republic of the Congo, Liberia, and Sierra Leone, and to the suppression of political dissent and the violation of human rights in countries like Congo-Brazzaville and Chad.
The efforts of various local organizations and advocates to promote greater transparency in the management of their countries’ natural resource wealth have garnered increased international
attention in recent years. A growing number of initiatives target oil and mining companies, governments and international financial institutions in their advocacy efforts.
The Kimberly Process – a joint initiative of governments, civic groups and the private sector – aims to limit the unregulated sale of rough diamonds as a source of funding for conflict. The Publish What You Pay (PWYP) Coalition, a network of over 300 non-governmental organizations worldwide, promotes mandatory disclosure of the payments made by oil, gas and mining companies to governments. Led by the United Kingdom’s Department for International Development (DFID) and the World Bank, with support from the private sector, the Extractive Industries Transparency Initiative (EITI)
encourages governments and their private sector counterparts to adhere to a voluntary set of principles that include publication and verification of company payments and government revenues
from oil, gas and mining. Research conducted by a number of other organizations, including Catholic Relief Services and International Alert, has also stimulated interest in the development of
more accountable and transparent resource management systems.
To be effective, these initiatives must foster cooperation beyond ministries, multilateral organizations and multinational corporations to include legislative bodies, political parties, civic organizations,
and the media. Each of these groups has a distinct and complementary role to play in demanding and enforcing accountability, and in ensuring that a nation’s natural wealth benefits broader populations.
This report is intended to help strengthen the capacity of legislatures to design and implement more accountable and transparent mechanisms for monitoring extractive industries generally, as
well as the collection and use of extractive industry revenues. Through research into the management and oversight of extractive industries in nine African countries, NDI has sought to identify and
raise awareness of effective policies, strategies, structures and techniques for overseeing revenues from extractive industries. Over the longer term, will assist reformers in selected countries
to develop strategies for increasing democratic oversight of extractive industry revenues.
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