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EITI findings; solid basis to probe institutional weaknesses

  • SOURCE: | qwesa2big
  • bostThe findings of the Extractive Industries Transparency Initiative report on Ghana’s extractive sector ‘provides a solid basis for probing further existing institutional weaknesses and the need to strengthen them,” Ato Forson, the Deputy Minister of Finance and Economic Planning has indicated.

    The 2010/2011 EITI reconciliation report on the oil and gas sector made some critical findings which point to various weaknesses within the extractive sector revenue institutions. It is in view of this that government institutions, companies among others affected by these findings and recommendations have been advised to ensure that the necessary corrective measures are put in place immediately.

    ‘Ghana is among many developing countries that depend heavily on the extractive sector. The discovery of oil and gas adds to this phenomenon and raises expectations among Ghanaians and the international community at large. The efforts to lower these expectations can only be credible if we enhance transparency and accountability by disclosing and publishing information on not only what government receives from the extractive industries, but also what the companies are paying to government.’

    It is for this and other reasons that the country is said to have signed on to the EITI in 2003. The EITI is a governance tool for improving transparency and accountability in respect to payments by companies in the extractive sector to governments. It seeks to improve resource management in natural resource-rich countries for current and future generations.

    These were made public on behalf of the Deputy Minister of Finance and Economic Planning as part of the highlights of the 2010/2011 EITI report on oil and gas and mining at a GHEITI dissemination workshop organised in Kumasi. The workshop among other objectives also provided a platform for stakeholders to be educated on the latest EITI standard reporting requirements.

    The 2010/2011 EITI reconciliation reports blamed some companies and government institutions for the challenges in the EITI reporting processes. These companies and government institutions were said to have been unwilling to provide the needed data as part of the EITI reporting procedures. ‘The Bank of Ghana declined to provide details of the petroleum Holding Account, while oil companies were also not willing to provide information beyond payments made to government.’

    ‘Since the entire reconciliation exercise hinges on data obtained from participants, the acquisition of data is critical to the flow of the process. Any delay affects significantly the timely completion of the exercise.’ However, it was indicated that the terms of reference for the assignment required the reconciler to analyse and comment on some details including operating cost, capital allowance computation, prices, and linings by GN PC and the IOC’s.

    In view of this development, the Steering Committee of the Ghana Extractive Industries Transparency Initiative (GHEITI) has been recommended to deliberate on the terms of reference, along with the time required for the completion of the report with both the state-owned Agencies and IOCs.

    The Deputy Ashanti Regional Minister, Hon. Yaw Edusie Opoku, noted that in spite of benefits the country derives from the extractive sector, particularly mining, conditions in mining communities do not measure up to the huge resources that have over the years been extracted by mining companies from those areas.

    Apart from the fact that most of the communities are deprived, such communities also continue to suffer from the adverse effects of mining. It is in line with these and other reasons that the role of EITI is very critical toward ensuring open’ and transparent management of resources from the extractive sector.’

    Source: B&FT

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