THE U.S. government Friday signed off on a US$297, 000 project to be manned by the respected Carter Center to help Guyana meet the premier global standard against corruption in the natural resources sector. “We are committed to improving transparency and accountability within the extractive industries sector and will work with the Carter Center to ensure that we meet our benchmarks…,” said Raphael Trotman, Minister of Natural Resources at the ceremony where the U.S. grant-funding was announced.
The project will help Guyana become a member of the Extractive Industries Transparency Initiative (EITI), in which member countries publicly report the revenues that are generated from the extraction of natural resources such as gold, diamonds and petroleum.
Guyana’s economy is heavily based on extractive industries and the country is soon to become an oil and gas producing nation, Minister Trotman noted, saying that these resources need to be managed judiciously.
“In this context, EITI will bring many benefits to Guyana: an improved investment climate, a signal to international investors that the government has a clear commitment to transparency and good governance, and strengthened accountability vis-à-vis the Guyanese people.
“Guyana’s entry into the EITI framework is not only because of oil, as our other resources must be better managed as well,” he stated.
U.S. Ambassador Perry Holloway said that the 12-month project will facilitate a series of programmes with the Ministry of Natural Resources to help Guyana accede to the EITI.
“I am confident this programme will strengthen the work of the Government of Guyana in promoting transparency in the country’s extractive industries at a time when Guyana prepares to welcome future growth in the petroleum industry,” said the U.S. Ambassador.
The benchmarks
Guyana’s efforts to become a member of EITI began under the previous EITI project, the Ambassador noted, and has its genesis in the People’s Progressive Party/Civic administration and he commended the new coalition government for “getting us closer to making EITI a reality in Guyana.”
Minister Trotman said the project will help Guyana to:
1. Publish the G-EITI work plan and implementation schedule
2. Identify sources of funding for EITI implementation
3. Review Guyana’s legal framework to identify potential obstacles to EITI implementation, and to ensure compatibility with EITI implementation and reporting
4. Build capacity for the multi-stakeholder group, other engaged ministries and parliamentarians
5. Develop EITI reporting templates and guidelines
Ambassador Holloway reminded those gathered at the simple ceremony of the benefits the significant oil find by U.S. oil giant ExxonMobil can bring to Guyana.
He said Guyana has the potential to be transformed from one of the poorest nations in the western hemisphere to one of the richest.
“However, it will take careful and thoughtful planning by key stakeholders to make this happen. We have talked about Guyana creating a Sovereign Wealth Fund and the importance of transparency and accountability.
“[Friday’s] announcement is a logical step in the progression towards assisting the Government of Guyana to achieving greater prosperity for the wonderful people of Guyana,” he stated.
Jason Calder, Country Representative of the Carter Center, said the centre’s involvement in the extractive sector spans more than a decade.
He explained that while Guyana is most familiar with the centre for its work on elections and political processes, it has much experience working in the extractive industries.
Calder like the U.S. Ambassador spoke of the potential, transformative impact that oil revenue could have if it supports a sound national development strategy.
“Central to such a strategy are the systems for inclusive governance, transparency and accountability.
“This has not been the reality in many countries stricken with the ‘resource curse,’ something we are certain Guyanese want to avoid.”
Multi-stakeholder group
There are currently 51 countries implementing the EITI Standard, with 31 being compliant, and Calder said the Carter Center looks forward to Guyana joining the group.
Calder said too that a tri-partite Multi-Stakeholder Group drawing from government, civil society and the extractive industries is to guide and oversee the EITI process in each country.
“The Government has been engaging with civil society and extractive industry actors on the process of forming this group. Our assistance is intended to build off that recently provided by the World Bank and to complement the fruitful collaboration Guyana has with the EITI secretariat in Trinidad and Tobago.”
He noted that the primary task of the Multi-Stakeholder Group is to produce an annual report in which the various types of extractive sector revenues paid by companies to the government are reconciled with those that the government reports receiving.
“There is much more to EITI though. Reporting under the EITI also examines revenue allocations, inter-governmental transfers, company social expenditures, the process for allocating licences and contracts, identifying the beneficial owners of companies in the extractive sector, and documenting the impact of the extractive industries on the economy.”
Additionally, he said the changes in laws, regulations, administrative systems and the way they work in practice and their accessibility to the public will receive regular scrutiny as part of the EITI. The role of EITI over the years can be significant in setting and advancing the national agenda.
Minister Trotman said that by the end of 2016, the government hopes to make great strides in not only Guyana’s candidacy in the EITI, but most importantly strengthening the good governance and transparency initiatives and other democratic fundamentals.
“Open, Transparent and accountable governance of the extractive industry are integral to the sustainable development of Guyana,” the minister stated.
Minister of Foreign Affairs and Acting Prime Minister Carl Greenidge gave the government’s assurance to pursue membership of the EITI.
He said the issue of governance has been much debated and is very important to Government’s commitment to ensuring the well-being of all Guyanese.
With the extractive industries being critical to the country’s economy, the Foreign Affairs Minister said it is important that those resources are properly managed.