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What impact has the EITI transparency initiative had on Nigeria?

Source: Sun, 26 May 2013 23:54 GMT
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Children stand in front of a stilt house used as a local fuel station near the river Nun in Nigeria's oil state of Bayelsa November 27, 2012. Despite billions of dollars worth of oil flowing out of Nigeria South East, life for the majority of Niger Delta's inhabitants remains unchanged. REUTERS/Akintunde Akinleye
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SYDNEY – An initiative to increase transparency in Nigeria’s extractive industries has failed to drive through substantial reform due to a lack of political will from the ruling elite, campaigners at an EITI conference in Sydney said.

However, they said Nigeria’s Extractive Industry Transparency Initiative (NEITI) had helped engender public debate about the role of the West African country's vast oil sector, which has brought great riches but which has also fuelled corruption and conflict.

A government minister also told the conference that NEITI had helped retrieve $2 billion in taxes.

Since 2002, the Extractive Industry Transparency Initiative (EITI) has helped activists, investors and the media shine a light on a country’s resource wealth by promoting the publishing of resource revenues.

Nigeria was an early adopter of the EITI in 2004 and is considered by some to be a poster child for the initiative in that it was the first country to enshrine a number of EITI principles into national law and the NEITI National Stakeholders Working Group is a statutory body.

But Nigeria is also often cited as a prime example of what is dubbed the resource curse, in that it is rich in oil but has significant governance problems, high levels of corruption and widespread poverty.

At the EITI’s biennial global conference last week in Sydney, conference participants agreed that while NEITI had certainly made a mark, the scope of its impact within the political sphere was limited.

“It is still too early to say we have achieved a lot in the transparency field because there is still a lot to do,” Ledum Mitee, chair of the NEITI National Stakeholders Working Group, told an audience at the May 23-24 conference.

“If we have been able to bring about a transparency increase in the public domain, can we say that it actually has led to an improvement in the lives of the people?” Mitee said.

“Personally, I would not say that that has happened. That’s why this conference is called “Beyond Transparency”; it is an admission that there are gaps,” Mitee added.

Oil accounts for around 80 percent of the Nigerian government’s revenue but state oil firm NNPC which is at the centre of the country's energy business is blighted by under-funding, mismanagement and corruption, according to several government investigations.

POLITICAL WILL LACKING

A number of conference participants cited a lack of political will in the Nigerian government to tackle mismanagement and corruption in the extractive sector as the key blockage to further reforms.

“When (people) talk about the fact that there is government political will because we (NEITI) are established, for me, that is not political will,” said Faith Nwadishi, head of the Publish What You Pay coalition of campaigners in Nigeria and an EITI board member.

Nwadishi said there had been umpteen reports with recommendations yet nothing was ever done.

“These recommendations, they are not implemented... we need to begin to say, this is what is happening, if the report says this, let us do this," she told Thomson Reuters Foundation on the sidelines of the conference.

“What is the essence of bringing out all those reports if we do not begin to implement?”

However, NEITI has had some notable successes, not least in that the audits of the oil industry that it has conducted have helped to identify and retrieve taxes owed to the government.

“As a result of Nigeria’s EITI audit exercise within the period 1999 to 2008, Nigeria recovered about $2billion from companies," Musa Sada, Nigeria’s minister of mines and steel development, told the conference.

“This is made up of funds we recovered from underpayments and underassessment of levies and petroleum taxes,” he said.

“We are hopeful that more funds will be recovered from the NEITI... from the period 2009-2011.”

 

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