AEITI

Extractive Industries Transparency Initiative (EITI)

Background

EITI is a global standard for transparency and good governance in the extractive sector.

In countries participating in the EITI, companies are required to publish what they pay to governments and governments are required to publish what they receive from companies. These figures are then reconciled by an independent administrator.  

A multi-stakeholder group (MSG) that includes representatives from the government, private sector and civil society organizations oversees the EITI process in each country.  Representatives on the MSG are responsible for liaising with their constituencies and acting as their spokesperson within the MSG.

The EITI International Board, which oversees the initiative, is comprised of representatives from EITI implementing and supporting country governments, extractive companies and investors, and local and international civil society groups. 

The EITI International Secretariat - based in Oslo, Norway - is responsible for turning the policy decisions of the International Board into action and coordinating worldwide efforts to support EITI implementation

Importance of EITI

In the effort to translate natural resource wealth into better development for the local population, the EITI sits in the center of the value-chain, focusing on revenue transparency. In resource rich economies, oil, gas and mining companies make payments directly to governments. Normal channels of public accountability are often missing in resource-dependent countries because the government has an autonomous source of revenue not dependent on taxing its citizens.  Government reliance on extractive revenues can result in lower public service delivery, increased opportunities for corruption and higher dependency on the extractive sector. The EITI aims to address this problem by increasing public information, empowering the public to more effectively hold government accountable for resource revenues. Some other benefits of increased revenue transparency include:

• Improving revenue collection and management processes
• Creating a more attractive investment climate
• Building trust between governments, companies and citizens
• Providing a forum to discuss broader extractive industry governance issues such as physical and process audits, contracts transparency and sub-national revenues

EITI implementation 

Although the EITI is a national process that varies from country to country, the EITI International Board has established a set of rules outlining the basic criteria and guiding countries through the three stages of implementation: sign-up, candidacy and compliance. …………………………………………………………………………………………………….                             
A. Countries voluntarily commit to the EITI by signing up to the initiative –yet they are not recognized as implementing EITI at this stage. 

B. in order for a country to become an EITI Candidate, it must first complete the four sign-up requirements and submit a proposal to the EITI International Board. 

C. If the Board is satisfied that these indicators have been fulfilled, the country will be officially recognized as a Candidate country.                                                                   ………..
……………………………………
EITI Candidate countries must undergo the EITI Validation process, which determines whether or not a country has achieved compliant status, may have its Candidate status extended beyond two years, or loses its Candidate status. The Validation is carried out by an independent validator selected by the MSG who must follow the methodology outlined in the EITI Rules.  Validation will only result in the granting of EITI Compliant status if the EITI International Board deems that a country has met all the indicators in the Validation Grid.

Afghanistan EITI 

Background