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Badilisha Lugha KISWAHILI

EU urged to expedite laws on resource extraction reporting

28th March 2012

Civil society organisations (CSOs) in the country have urged the European Union (EU) to show global leadership in natural resources extraction and logging by speeding up legislation of its proposed mandatory reporting requirements.

The CSOs said that over two-thirds of the world’s poorest people lived in resource-rich developing countries, stressing that lack of transparency in the management of Africa’s booming extractive and logging industries denied people information on how much revenue was generated from extraction of their resources by multinational corporations and how their governments spent such revenues for their well-being.

In their report made available to this paper yesterday, a group of Tanzanian CSOs, including Policy Forum, Publish What You Pay Tanzania (PWYT), Agenda Participation 2000, HAKIMADINI, Legal and Human Rights Centre (LHRC), Tanzania Natural Resource Forum (TNRF), International Alliance on Natural resources in Africa (IANRA Tanzania) and Lawyers Environmental Action Team (LEAT) said meaningful transparency and accountability meant all citizens had the right to know the amount of wealth generated from each resource and the terms of the deals and contracts signed between their governments and extraction companies.

“In February 2009, Tanzania joined the Extractive Industries Transparency Initiative (EITI) with other 30 governments worldwide. However, the initiative remains voluntary and narrow in scope…the first country’s EITI reconciliation report remains surprisingly a source of information about gas and mineral revenues, with inconsistency of about 30 per cent in the total payments.

"The depth of the information does not warrant meaningful comparison of revenues and the amount of resources extracted,” it said, adding that the report did not include payments in kind.

In a meeting organised by Policy Forum recently to discuss the proposed EU regulations on mandatory disclosure on extractives and logging and its implications to the governance of Tanzanian oil, gas, mineral and forest sectors, the CSOs underscored a need for comprehensive disclosure of payments made to the governments resulting from the extraction of resources.

They said they commended the European Union Commission for proposing mandatory disclosure requirements for multinational companies to report on all payments, including payments in kind, country-by-country.

They further established that the union had a great responsibility and opportunity to make a huge difference to the push for transparency and democracy in Africa and the world.

In addition, the CSOs said attention must be given to the voice of the real people in the country and Africa at large who have lost a great deal of their national wealth to corrupt governments and multinationals.

“The EU cannot allow African children, women and men to die of hunger, malnutrition, curable diseases and bloodshed caused by resource-based conflicts while these people’s resources are being squandered,” they said.

A report by Traffic estimated that Tanzania lost US$58 million a year in 2004 and 2005 in timber revenue due to poor governance and corruption in the forestry sector. In 2008/9, Tanzania exported gold worth over US$800 million but generating only less than 10 per cent in tax revenue. In 2008, tourism was estimated to be generating over US$1 billion annually.

However, experience worldwide suggests that lack of trust about the management of these sectors breeds conflicts and unrests, exacerbating the high incidence of poverty in the countries.

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