Creating transparency in the extractive resources sector
Nearly a decade after its initial attempt to join the Extractive Industry Transparency Initiative (EITI), Equatorial Guinea has made significant strides toward becoming a member of the non-profit organization this year.
The most promising step came in February this year, when Equatorial Guinea received the official endorsement of the EITI International Secretariat and established positive bilateral relations between the two parties in a meeting held at the Secretariat’s headquarters in Oslo, Norway. In the meeting, the National Commission provided a letter of intent for its membership in the initiative, along with a detailed report on the status of Equatorial Guinea in its process of adhesion to the EITI standards, which outlined all of the improvements and efforts carried out by the country since its last attempt to join the organization.
Implemented in 52 countries, EITI serves as a global standard for the responsible governance of oil, gas and mineral resources, seeking to strengthen key public and corporate governance issues of transparency and accountability by requiring the disclosure of information along the extractive industry value chain – from how revenues make their way through the government to how they benefit the public.
Countries implementing the EITI Standard are required to publish annual reports in which companies report payments to the government and the government reports what it has received. The reports include additional data such as beneficial ownership disclosure, policies and license and contract information.
In 2008, Equatorial Guinea attempted to join the initiative by becoming an EITI candidate – to become a full member, a country’s government must submit an application as well as solicit the support of a multi-stakeholder group composed of representatives from government, companies and civil society. The country then has 18 months from the date it was admitted as a candidate to publish its first EITI report to receive validation. Equatorial Guinea was not able to meet the requirements within the mandated period of time. In 2010, its request for an extension of validation was not approved, and consequently, it was not enrolled as a member country.
Since then, Equatorial Guinea has enacted a series of reforms in an attempt to join the organization, forming an EITI National Commission in 2015. Headed by its president and the Minister of Mines and Hydrocarbons – H.E. Gabriel Mbaga Obiang Lima – the commission is composed of members from the Ministry of Economy, Planning and Public Investment, the Ministry of Finance and Budgets and Equatorial Guinea Civil Society. The Minister reaffirmed the country’s commitment to the adhesion process and compliance with the EITI standards.
“Membership of the EITI would represent a milestone for the country and a critical step forward in its path toward greater transparency and improved governance and management of its extractive resources sector. It continues to be my firm belief that our membership in the EITI will lead to a more attractive investment climate and an increase in foreign direct investment in the energy and non-energy sectors,” he said.
In addition to attracting increased investment, the benefits of becoming a member country extend to companies, government and its citizens. Companies profit from a level playing field and a more stable investment climate in which all companies are required to disclose the same information. Governments also benefit from adhering to an internationally recognized standard that reinforces a commitment to reform and anti-corruption, leads to improvements in the tax collection process and augments mutual trust and stability in an otherwise volatile sector. Lastly, citizens receive an advantage in accessing reliable information about the sector and being a part of a multi-stakeholder platform, in which they can better hold the government and companies accountable.
Under the auspices of H.E Obiange Nguema Mbasogo, President of Equatorial Guinea, Africa Oil & Power will host the African Petroleum Producers Organization (APPO) Cape VII Congress and Exhibition, on April 1-5, at the Sipopo International Conference Hall in Malabo.
Registration for the conference is now open. Get your delegate pass today.