Extractives transparency gathers pace in the West

Subject

Developments on transparency in the extractives sector.

Significance

Transparency legislation on the extractives sector progressed in December 2015 when the US Securities and Exchange Commission published a revised proposal to enhance the transparency of extractive (ie, mining and oil and gas) industries' payments to governments in producing countries. The aim is to provide information on financial transfers which can then be used by civil society, media and other stakeholders to hold those governments to account. The United States was a pioneer in this area, but litigation against its original initiative delayed its progress.

Impacts

• Low commodity prices shift the balance of power from producing countries to consuming ones.
• That makes producer countries more susceptible to pressures for reform and may be a good time to push for greater transparency.
• However, opaque and inaccessible power structures in producer states could still limit NGO capacity to use more data to reduce corruption.
• A test of this will be whether the issue of resource transparency gains traction within the G20.