Dear Friends of the EITI,
The EITI underwent a major shift in 2013. The EITI Standard was launched, significantly increasing the ambition and reach of EITI; efforts were made to increase coverage and use of data; and there were commitments from major new resource rich countries to join the EITI movement. The EITI can now truly claim to be a global Standard.
The EITI Standard makes the EITI more meaningful and more comprehensive
The Standard, which replaces the EITI Rules, moves the process beyond a tick-box exercise to make it more adaptable to the needs of each country and more easily linked to wider reform efforts. The Standard requires the
Our priority in 2014 will be to roll out the EITI Standard to make the EITI more useful to all stakeholders. We will also seek to reach out to more countries.
Use of EITI data
Thirty-five countries have now disclosed their key extractive data. The EITI infographic competition provided an opportunity to illustrate data on the payments from oil, gas and mining to highlight specific issues in the extractives sector. The submissions were creative and told unique stories. It was inspiring to see how the complex EITI data could be presented in a way to make the EITI more intelligible to citizens.
The business case for the EITI is becoming stronger with EITI data helping company decisions and helping countries make their tax collection equitable and efficient. Eight additional companies declared their support to the EITI in 2013.
At the end of this year, almost 200 fiscal years and well over a trillion dollars of taxes and royalties will have been covered by EITI reports. In Nigeria, the EITI process uncovered vast discrepancies between what the government has received and what they should have received. For the three-year period 2009-2011, these Nigeria EITI Reports revealed that a company owed tax payments adding up to US
$8.3 billion. That is more than the Federal Government spent on education in the same period. As a consequence US $443 million has already been recovered into state coffers. Nigeria EITI is committed to conduct further investigation of the missing payments in collaboration with tax collection agencies.
As part of their EITI, in 2013 Liberia performed what they called a “Post Award Process audit”, which looked at 68 contracts that had been awarded. The Economist commented "The audit found that 62 of the 68 concessions ratified by Liberia’s parliament had not complied with laws and regulations”. The government is exploring these cases the policy, legal and legislative implications.
EITI for all resource-rich countries
This year has brought about a significant growth in countries implementing the EITI. Honduras, the Philippines, Senegal, Tajikistan and Ukraine all became full reporting countries in 2013, bringing the total number to 41. The United States, Ethiopia, and Papua New Guinea have recently submitted Candidature applications; Colombia and Myanmar are preparing theirs; Australia is conducting an EITI pilot, and France, Italy and UK have begun the implementation process.
Thank you to the Board and all EITI stakeholders around the world
I want to thank the Board and the whole EITI family for the tremendous work that has been done in this past year. Developing the new Standard was not without its challenges, but we now have a Standard that will help us better achieve the objectives we set ourselves when the EITI Principles were adopted. It was time to evolve from a process that encouraged the meeting of our requirements to one that really encourages better governance of the extractive sector.
I look forward to working with you all over the next two years. I hope and believe that the EITI, when incorporated into broader reform efforts in countries, will make an important contribution towards ensuring that citizens of resource rich countries enjoy the benefits of their natural resources.
Best wishes for 2014,