Yemen reaffirms commitment to transparency [Archives:2006/995/Business & Economy]

October 2 2006

By: Raidan Abdulaziz Al-Saqqaf
[email protected]

The international community seems to be very concerned with the 'resource-curse' of countries with considerable mineral resources such as oil, gas and minerals, yet continue to suffer from extreme poverty and underdevelopment. The Extractive Industries Transparency Initiative in Oslo included a serious discourse on the resource-curse by the international community with delegations from countries suffering from the curse. Yemen sent a high-level delegation and actively participated in the conference.

The Extractive Industries Transparency Initiative has a specific and a tangible objective – creating transparency in revenue streams. In line with that objective the President of the World Bank Paul Wolfowitz has illustrated the example of Nigeria, a resource-rich country which has lost US$ 300 billion or oil revenues due to corruption and lack of transparency during the last few decades, as a reminder of the size of the problem: “…can the benefits from extractive industries be a blessing for countries or is it in fact perhaps sometimes a curse?” Wolfowitz asked in his opening address in the EITI Oslo conference.

Many development agencies were represented in the Oslo EITI conference, as well as western donor countries sharing the same concerns as Wolfowitz, along with delegations and representatives of some 60 developing and underdeveloped countries which have considerable mineral resources, including Yemen. However the non-presence of Asian representatives was noted in spite of the great developmental and Economical interests of Asian countries such as Japan and China with many participant countries which suffer from the resource-curse.

Nevertheless, the fundamental principles underlying EITI are universal, as it focuses on transparency and disclosure and requires the cooperation of three parties involved, governments, oil and extractive companies and the civil society for the EITI to succeed in any country and in the 22 countries which have vowed to implement the initiative, only two countries have made significant progress, while the other 20 are still lagging behind.

Key governance lessons of relevance to EITI include the fact that improving accountability helps tighten revenue collection and expenditures to increase transparency, freedom of information and public disclosure of expenditures. Corruption happens because of weak regulatory frameworks, low public sector wages and poor service delivery, and low levels of participation in political and economic activities emerges when there is little citizenship involvement in planning and monitoring of public expenditures.

“The EITI process has given key stakeholders a global stage to make commitments to help ensure that natural resource revenues alleviate poverty,” said Henry Parham, International Coordinator of Publish What You Pay, which campaigns for full transparency revenues. “To take steps to reduce poverty, we need more than words,”

To motivate governments even further to endorse and implement the EITI, Robert Jenkins, Chairman of the Board of F&C Asset Management indicated that a group of over 70 international investment institutions representing combined assets of US $12.3 trillion will signal its strong support for an inter-governmental effort to boost transparency standards in the oil, gas and mining sectors of developing countries through investing in countries which endorse the EITI and exhibit a high commitment to transparency.

“EITI can bring more stable government and prosperity for the citizens of resource-rich developing countries