The International Monetary Fund (IMF), while commending Guyana for its progress in strengthening its anticorruption framework and fiscal transparency in the extractive industries, has urged government to more closely follow up on the recommendations of the Extractive Industries Transparency Initiative (EITI).
The opinion was contained in the financial institution’s report on 2022 Article IV consultations with the government and other authorities.
“On EITI (Extractive Industries Transparency Initiative), staff urged the authorities to improve the information sharing and publication of extractive industries’ financial statements, move towards electronic disclosures and more closely follow up on EITI’s recommendations to address the remaining gaps, where Guyana scores low,” the report stated while referencing the 2019 EITI Validation report released in April of this year.
The EITI’s Board 2019 validation report was released in April and indicated that Guyana received a 52 points rating, which reflects an average of the three-component scores on Stakeholder engagement, Transparency and Outcomes and impact. This report was available to the government in March 2021.
EITI is a global standard to promote open and accountable management of natural resources. It seeks to strengthen government and company systems, inform public debates, and enhance trust. In each implementing country, it is supported by a Multi-Stakeholder Group (MSG) comprising government representatives, extractive companies’ officials and civil society organisations working together.
The IMF Executive Directors, in the report released on September 27, noted that while there is considerable fiscal transparency and a robust anti-corruption framework, the Guyanese authorities are committed to further strengthening governance, particularly on EITI.
“The authorities recognize that following up adequately on EITI recommendations is critical. Prioritization will be needed as capacity is built over time,” it noted.
The IMF report noted that efforts in strengthening the anti-corruption framework as well as transparency of the governance of oil receipts will also be needed to support growth in Guyana. It reminded that the 2019 Article IV report noted weaknesses in the governance and anti-corruption frameworks that could give rise to corruption vulnerabilities.
“Staff noted the authorities’ progress in strengthening Guyana’s anticorruption framework and fiscal transparency in the extractive industries. Recent progress on the anti-corruption framework includes the publication of audit reports of public expenditures, including for COVID implementation of some recommendations noted in the 2019 Article IV Staff Report, as well as the re-establishment of the Integrity Commission. Asset declarations of a large number of public officials are submitted annually, and public procurement tenders are streamed live,” the report said.
Additionally, the IMF Executive Directors said that authorities expressed their commitment to accelerate the electronic publication of key information on procurement contracts, establish a bidders register, continue publishing audit reports of public expenditures including COVID-19 funds, and further strengthen mechanisms and processes for required follow-up as applicable.
The Guyanese authorities that met with the IMF team back between May and June noted that the country’s anti-corruption framework is aligned with international standards, and is being further improved. Moreover, the government intends to increase public awareness about the functions of its anti-corruption framework including increasing the efficiency of the Integrity Commission and the NPTAB.
In its 2019 validation report, the EITI Board commended Guyana for successfully establishing the country’s first functioning platform for multi-stakeholder discussions of the governance of the extractive industries. It also welcomed Guyana’s efforts to tailor the scope of its EITI implementation to address public demands for information beyond the extractive industries to cover forestry and fisheries.
However, the Board also warned that Guyana could face suspension if it fails to show significant progress.
“The Board has determined that Guyana will have until a next Validation commencing on 1 April 2024 to carry out corrective actions regarding government engagement (Requirement 1.1), industry engagement (Requirement 1.2), MSG governance (Requirement 1.4), work plan (Requirement 1.5), contract and license allocation (Requirement 2.2), license registers (Requirement 2.3), contracts (Requirement 2.4), beneficial ownership (Requirement 2.5), state participation (Requirement 2.6), comprehensiveness (Requirement 4.1), transactions related to SOEs (Requirement 4.5), disaggregation (Requirement 4.7), data reliability (Requirement 4.9), distribution of revenues (Requirement 5.1), social and environmental expenditures (Requirement 6.1), SOE quasi-fiscal expenditures (Requirement 6.2), public debate (Requirement 7.1), data accessibility (Requirement 7.2), follow-up on EITI recommendations (Requirement 7.3) and the MSG’s review of outcomes and impact (Requirement 7.4).
“Failure to demonstrate progress on Outcomes and impact, Stakeholder engagement and Transparency in the next Validation may result in temporary suspension in accordance with Article 6 of the EITI Standard. In accordance with the EITI Standard, Guyana’s MSG may request an extension of this timeframe or request that Validation commences earlier than scheduled,” the report stated.
