Guyana has been suspended from the global Extractive Industries Transparency Initiative (EITI) for failure to submit a report for 2020, sources tell Stabroek News.
Georgetown was formally advised of the development on February 17th by the Norway-headquartered body but there has been no word from the government about it.
EITI countries commit to disclose information along the extractive industry value chain – from how extraction rights are awarded, to how revenues are channelled through government and how they benefit the public. Through participation in the EITI, more than 50 countries have agreed to a common framework governing what has to be disclosed and when – the EITI Standard. Now that Guyana is an oil producer the Standard is seen to be even more important.
In each country that has joined the EITI, a multi-stakeholder group, comprised of government, companies and civil society, supports implementation of the EITI Standard.
The suspension could be lifted if the local affiliate of EITI, GY-EITI is able to submit the report as required. The suspension will however be seen as a major embarrassment for the PPP/C government which has at times appeared lukewarm to the Initiative.
Turmoil was also sown in the GY-EITI when the government parachuted its former media czar, Dr Prem Misir into GY-EITI in March last year rather than renew the term of Dr Rudy Jadoopat who had been in the position for some years.
Dr Misir and some stakeholders in the GY-EITI have clashed over decisions he has made and this has further inhibited progress on matters that needed to be addressed for the EITI standard.
EITI has advised Minister of Natural Resources, Vickram Bharrat about the decision to suspend and has presumably also advised GY-EITI.
Sources say the 2020 report was due on December 31, 2022 but this deadline passed without it being completed. A subsequent request by Georgetown for an extension of the deadline was denied by EITI as no extenuating circumstances were cited. Guyana had previously sought an extension for the 2019 report and this was agreed as the COVID-19 pandemic had been deemed a legitimate impediment.
In October last year, the International Monetary Fund (IMF), while commending Guyana for its progress in strengthening its anti-corruption framework and fiscal transparency in the extractive industries, had urged government to more closely follow up on the recommendations of the 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 last year.
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.
On June 25th last year, Head of the EITI Mark Robinson had said that Guyana’s tax framework is not built to facilitate transparency – one of the major requirements of the international EITI standards – and encouraged that it be improved so that Guyana can become fully compliant.
Robinson was speaking at the end of his three-day visit to Guyana. The visit was a result of Guyana’s first validation report by the International Board of the EITI. The country received a fairly low overall score in implementing the requirements of the EITI and Robinson’s visit was to meet with the government, GY-EITI, industry representatives and other stakeholders to aid in the strengthening of the system of compliance.
The EITI’s Board validation report was released in April and indicated that Guyana received a 52 points rating, which reflected an average of the three component scores on Stakeholder engagement, Transparency and Outcomes and impact. The exercise was conducted by comparing Guyana’s performance against the 2019 EITI standards.
The EITI Board, in its report, expressed concern over “Guyana’s low score on Outcomes and impact (42 points). This reflects the ad hoc approach to outreach and dissemination, weaknesses in follow-up on EITI recommendations to deliver reforms and insufficient attention to the annual review of outcomes and impact, with a view to informing the annual EITI work plan.”
One of the major shortcomings identified in the report is the legislative shortcomings that prevent the examination of earnings and other information from the extractive industries.
Some in the gold mining industry have showed resistance to compliance with the EITI Standard.
On November 25th last year, the Alliance For Change voiced concerns that Guyana’s relations with EITI could be in jeopardy as the 2020 report was still to be completed.
