How Governments Fail to Secure a Fair Share of Natural Resource Wealth

Launch of PWYP-Canada’s New Report: Many Ways to Lose a Billion: How Governments Fail to Secure a Fair Share of Natural Resource Wealth

 

Unfortunately, countries rich in oil, gas and minerals often fail to secure a fair share of their natural resource wealth. Revenue loss from the extractive sector is particularly significant given the large number of countries that depend on natural resource revenues for a substantial portion of their annual budgets. This report seeks to identify the main pathways through which governments lose revenue in the extractive sector and to illustrate these with real-world case studies.

Publish What You Pay (PWYP) coalitions have very successfully advocated for new laws and standards that require that mining, oil and gas companies disclose the payments they make to governments. We have equally worked for changes to standards that support contract disclosure and transparency of company ownership, amongst other things. With new data at hand, there is a growing focus on strengthening the mechanisms by which transparency is used for accountability.

With greater transparency, the link between transparency and accountability is being tested. Civil society is challenged to use new disclosures to change government policies, company behaviour and even global systems. Despite many documented successes, the complexity of both global corporate arrangements and the national laws/contracts that govern the extractive sector, pose a serious analytical challenge.

Recognizing this challenge, PWYP-Canada, with the support of the PWYP Secretariat, has worked with author Don Hubert to write, ““Many Ways to Lose a Billion: How Governments Fail to Secure a Fair Share of Natural Resource Wealth.” This report responds to a persistent question: is my government receiving its fair share of revenues from extractive sector projects? While no single report can specify what constitutes a fair share for every resource project, by identifying and illustrating the common pathways to government revenue loss in the extractive sector, this report will help stakeholders pinpoint mechanisms and policies that can safeguard critical revenues.

It will equally serve as a tool to enable deeper and more systematic analysis of data on company payments to governments. A need made more pressing as new laws, such as the one in Canada, see hundreds of extractive companies report payments to governments around the world every year.

At the global level, the PWYP network has recognized this challenge and is developing different programs focused on using the data. At the national level within the PWYP global network, there is a plethora of initiatives focused on putting data to use. This report aims to enhance and enable those discussions; to be a critical tool for those analyzing government revenues and fiscal regimes; and to be a platform for more informed discussions about whether governments are receiving their ‘fair share.’ For PWYP-Canada, this report provides a critical overview of the systems and policies within which companies make payments and will enable citizens, researchers and others to explore the hundreds of new reports disclosed this year by mining, oil and gas companies in accordance with the Extractive Sector Transparency Measures Act.

http://www.publishwhatyoupay.org/pwyp-resources/many-ways-to-lose-a-billion/

Source of article: GOXI