This week French Foreign Minister Dominique de Villepin is to visit several African countries, including oil-dependent Congo-Brazzaville. Whilst there, Mr de Villepin should follow through on France’s recent commitments to champion revenue transparency.
Making heavily-indebted Congo’s management of oil revenues more transparent is the key to the country’s development, as the IMF and World Bank have recognised. France has a particular responsibility to help: former state oil company Elf’s secret system of kickbacks, influence-peddling and oil-backed loans, culminating in its support for both sides in Congo’s 1997 civil war, led the country down the path of indebtedness and unaccountable government.
The Congolese Government has now committed to improve transparency under an IMF programme, but serious question-marks remain about the pace of reform. The IMF itself has noted recently that ‘improving transparency and accountability in the transactions of the national oil company remains an important challenge’. Congolese civil society organisations and Church leaders have made repeated appeals for the support of the international community to ensure better management of their oil income; as yet to no avail.
France played a leadership role at the Evian Summit, where the G8 recognised the urgent need for improved transparency in the management of revenues from oil, mining and gas in resource-rich-but-poor countries. This includes disclosure of payments made by extractive companies and of revenues received by governments, as advocated by the international Publish What You Pay coalition.
France has reaffirmed its commitment to revenue transparency through participation in the UK Government’s Extractive Industries Transparency Initiative (EITI), which has developed a model for the reporting of revenues by both companies and producer governments to make sure that oil money from companies is actually being received by the national treasury. At the recent launch of the EITI, France’s representative stated that his Government stood fully behind the EITI and was prepared to enter into a dialogue with states and companies to make headway on this issue.
Global Witness and its coalition partners believe it is now time for the French Government to move beyond words to take concrete action. ‘Given France’s major historical and economic links with Congo, Mr de Villepin’s visit is the perfect opportunity for his Government to begin implementing its commitments on revenue transparency’, says Global Witness campaigner Sarah Wykes. ‘He should use his time in Congo to encourage the Government to begin piloting disclosure of its oil revenues through the EITI, and to respond to civil society’s concerns about where the oil money is going’, she added.
Contact: Sarah Wykes on +44 (0)207 272 6731 or +44 (0)7947 008 580 or Gavin Hayman on +44 (0)207 272 6731.
(1) Global Witness focuses on the links between the exploitation of natural resources and the funding of conflict and corruption. It is non-partisan in all its countries of operation. Global Witness has been co-nominated for the 2003 Nobel Peace Prize for its work in uncovering how diamonds have funded civil wars across Africa.
(2) According to the IMF and World Bank, Congo’s debt currently stands at US$ 6.4 billion, with servicing of oil-backed loans taking one third of total government revenue. French company Total (formerly TotalFinaElf) accounts for two thirds of oil production.
(3) Fighting Corruption and Improving Transparency: A G8 Declaration; http://www.g8.fr/evian/english/navigation/2003_g8_summit/summit_documents/fighting_corruption_and_improving_transparency_-_a_g8_action_plan.html
(4) The Publish What You Pay campaign was launched in June 2002 (see www.publishwhatyoupay.org). It calls for stock market and international accounting rules to require oil, gas and mining companies to disclose their net payments to governments for resource access on a country-by-country basis. The campaign now has over 130 member NGOs in the North and South. The coalition believes that revenue transparency is an essential condition for alleviating poverty, promoting just and equitable development, improving corporate social responsibility, and reducing corruption in many resource rich developing countries, such as Algeria, Angola, Azerbaijan, Cambodia, Chad, Colombia, Congo-Brazzaville, Democratic Republic of Congo, Equatorial Guinea, Gabon, Guinea Bissau, Indonesia, Iraq, Kazakhstan, Nigeria, Papua New Guinea, Sudan, Turkmenistan and Venezuela.
(5) Information on the Extractive Industries Transparency Initiative is available at: www.dfid.gov.uk.
(6) The full Global Witness statement on the EITI can be downloaded at www.globalwitness.org. In addition to requiring companies to disclose their revenues, it is important to increase the transparency of government revenue streams from production sharing agreements and state-owned companies. Global Witness believes the EITI reporting principles must be reinforced by the imposition of appropriate conditionality on relevant bilateral and multilateral development assistance, resource-backed loans from banks, and export credit agency funding. In addition, the World Bank and the IMF should be required to mainstream revenue transparency across their lending and technical assistance portfolios.
Press Release / July 28, 2003