The Extractive Industries Transparency Initiative (EITI) Board, currently meeting in Manila, Philippines, decided to approve Guyana’s application to join the EITI.
This is momentous as civil society and other stakeholders have been advocating for Guyana to join the global transparency standard since 2010 in a bid to ensure its natural resource wealth is governed well.
The country’s candidacy was approved during the 38th EITI International Board Meeting. Guyana officially submitted its application to the International Secretariat of EITI in Oslo, Norway, in August.
Guyana’s EITI National Coordinator, Dr. Rudy Jadoopat is attending the Board Meeting and was accompanied by Curtis Bernard, Co-Chairman of the Multi-Stakeholder Group, representing Civil Society.
Following the announcement, former Natural Resources Minister Robert Persaud said it was significant progress after a long, tedious process. Although the initiative started under the previous Peoples Progressive Party (PPP) government, Persaud congratulated the current Minister Raphael Trotman and his team for continuing Guyana’s bid.
“Critical too has been the support of local and international stakeholders particularly the United States Government. A good day for transparency in the extractive sector including oil and gas,” Persaud said.
Ahead of the last round of countrywide outreaches in July, a multi-stakeholder group was formed, made up of government institutions, mining companies and civil society organisations.
This group has developed a work plan for the first few years of implementing the EITI and will oversee the activities with support of the GYEITI Secretariat in Guyana.
Dr. Jadoopat had said that the initiative was to ensure that oil and gas companies operating in Guyana publish what they pay to the Government in taxes and royalties.
Under the EITI standard, companies publish what they pay to governments, and governments publish what they receive in an annual EITI country report.
In many countries, most of the revenues from natural resources accruing at subnational levels are not derived from company payments to local government entities, but from transfers from the central government.
Depending on the revenue-distribution frameworks in place, these transfers can be a considerably larger source of revenue for subnational entities than taxes and fees collected at local levels. The revised EITI standard requires that such transfers are reported where mandated by law and where material.
Where companies are legally or contractually required to make social contributions, these must be disclosed, under EITI standards. Where countries collect significant revenues from the transportation of oil, gas and minerals, such as pipelines, the Government will also be required to disclose the revenues received.
The requirement to publish annual activity reports is not limited to compliant countries, the EITI said. It is foreseen that countries will report on progress with meeting the EITI requirements as well as (on) efforts to achieve the objectives set out in their work plans.
Validation is procured and managed by the EITI’s International Secretariat rather than by implementing countries. Countries undertake validation more frequently, with compliant countries being revalidated every three years as opposed to every five years under the old rule.
Guyana’s first EITI Report must be published within the next 18 months and the country will be required to commence validation within two and a half years. Where validation verifies that Guyana has made satisfactory progress on all of the requirements, the EITI Board will designate the country as EITI compliant.
The Extractive Industries Transparency Initiative (EITI) is a global standard to promote the open and accountable management of oil, gas and mineral resources.