Conflict and cooperation on natural resources: Justifying the CoCooN programme - Conflicts Over Natural Resources in the Global South - page 24

by Bannon and Collier (2003) outlines the insights and policy recommendations that
have emerged from this project. They recommend general measures promoting global
development, believing development in general to reduce conflict. With regard to the
governance of natural resources specifically, they discuss a whole series of measures:
increased transparency of natural resource revenues; certification of origin; checking
of finance of illicit commodities; scrutiny of illicit payments; and attracting reputable
companies to risky environments.
Extractive Industries Transparency Initiative (EITI)
The lack of transparency and accountability of the payments that companies make
to governments and the revenues that governments receive from those companies
compounds effective ameliorative international action. The Extractive Industries
Transparency Initiative (EITI) launched by British Prime Minister Tony Blair on the
World Summit for Sustainable Development in September 2002, seeks to ensure that
transparency and accountability. EITI is a voluntary initiative supported by a coalition
of companies, governments, investors and civil society organisations that follow the
so-called EITI Principles adopted in 2003. In 2005 a set of criteria for the implementa-
tion of the EITI was formulated and actions to be taken by governments and industries
were compiled in a source book. Through the EITI, citizens can hold governments and
industries accountable for the origin and use of the revenues resulting from extractive
industries (Extractive Industries Transparency Initiative 2005).
International and governmental transparency initiatives
EITI is closely linked to a number of similar initiatives. The G8 countries, for example,
issued a Declaration on Fighting Corruption and Improving Transparency at Evian in
2003. The IMF has promoted fiscal transparency in member countries via the vol-
untary Code of Good Practices on Fiscal Transparency and the associated manual.
Implementation of the code is monitored through the production of Reports on the
Observance of Standards and Codes (ROSCs). Both the IMF and the World Bank pro-
mote more effective resource revenue management through policy advice, policy-based
and project lending, and technical assistance. The OECD has developed Best Prac-
tices for Budget Transparency and a Due Diligence Guidence for Responsible Supply
Chains of Minerals from Conflict-Affected and High-Risk Areas. A sectoral example
is The Forest Law Enforcement and Governance (FLEG) Ministerial Process focusing
on East Asia, which aims “to increase the amount of forest-related rent that accrues
to the government and to prevent the illegal appropriation of such rent, including via
illegal logging'' (Swanson et al. 2003: 62). In 2005, the European Union adopted a
Voluntary Partnership Agreement mechanism under FLEG, with (in 2012) implemen-
tation agreements in Cameroon, Ghana (Beeko and Arts 2010) and the Republic of
Congo, and new initiatives in other African and Asian countries. 5 Section 1502 of the
Dodd-Frank Act - passed by the US Congress in July 2010 - foresees a disclosure
requirement that calls on companies to determine whether their products contain con-
flict minerals, which some fear will put a de facto embargo on minerals from the DRC,
forcing many artisanal miners to seek alternative livelihoods.
5 See: http://ec.europa.eu/environment/forests/flegt.htm