afrol News, 16 October - Ahead of the International Conference on Extractive Industries Transparency Initiative (EITI) in Oslo, Norway, from 16 to 17 October, the African Development Bank (AfDB) has endorsed EITI to fight the "oil curse". The initiative is expected to enable mineral rich African countries to derive greater benefits from oil, gas, mineral and other natural resources by publicly disclosing revenues, rejecting corruption and using their proceeds for development.

The Bank's endorsement of the EITI also follows a meeting of representatives of the Norwegian Agency for Development Corporation (NORAD), the World Bank and the EITI in Tunis earlier, where experiences were shared with Bank officials on the key challenges in the extractive industries and institutional policies and activities related to the sector.

"There is an important role for revenues generated from oil and gas and other extractive industries in public financing of economic and social development programmes," AfDB Vice President Zeinab El Bakri said, believing that "opportunities for many resource-rich countries in Africa lie in the fact that more and more investors are interested in extractive industries, but which present challenges with regard to the management of revenues, ensuring accountability and avoiding corruption on the one hand, while promoting sustainable development in the context of transparency and fiduciary discipline on the other."

The Bank's endorsement of the initiative is expected to help resolve one of the most striking paradoxes of the African continent, where countries with vast mineral wealth are among the poorest in the world - often referred to as the "oil curse". 14 of the 22 countries around the globe that have joined the EITI are in Africa. The donor partners of the EITI include the G8, and Norway.

A group of companies and industry associations, including IMF, World Bank and Publish What You Pay Coalition, are among the participants to the conference. The Initiative is in line with the bank group's policy on good governance approved in November 1999, and "aimed at supporting good governance practices in its member countries in a manner consistent with its charter, mandate, and development priorities."

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 are needed; corruption is engendered by 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 global EITI community adheres to principles such as prudent use and proper management of natural resources for the benefit of the citizenry, understanding government generate revenues and expenditure by the public for informed choices, transparency by governments and companies in the extractive industries; and above all, and stakeholder engagement.

By staff writer

© afrol News

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