Today, British Prime Minister Tony Blair will announce an international initiative aimed at preventing the mismanagement of money paid to developing countries by oil, gas and mining companies. The initiative to build global support for greater transparency in the extractive industry's dealings with governments in the developing world, calls for full disclosure of all payments to governments and national authorities. The Publish What You Pay coalition, which consists of more than 60 non-governmental organisations worldwide, including CAFOD, the Scottish Catholic International Aid Fund and Christian Aid, welcome the announcement. But they say regulation, rather than a voluntary framework, is required to prevent companies flouting such an initiative. A coalition spokesperson said: "The oil, gas and mining industry is important to more than 50 developing countries, which are home to 3.5 billion people. Yet more than 1.5 billion of these people live on less than $2 per day, while 12 of the world's 25 most mineral-dependent states, and six of the world's most oil-dependent states, are classified by the World Bank as highly indebted poor countries with the world's worst human development statistics. "Revenues from such investments make their way to governments and national authorities in the form of taxes, fees and other payments. All too often the institutions managing these revenues are unaccountable to ordinary citizens and become a vehicle for embezzlement, fraud and corruption. Full disclosure of all payments to governments and national authorities would help ensure more open decision making, deliver greater accountability between governments and their citizens, and provide a successful basis for growth and poverty reduction. The Publish What You Pay coalition says regulation will be required to prevent companies flouting such an agreement. A regulatory framework would ensure that all extractive companies had to publish the net revenues they paid governments as a requirement of listing on major stock exchanges. The regulatory burden would be minimal because those companies already know what they pay for internal accounting purposes. Katherine Astill, Private Sector Policy Analyst at CAFOD, said: "When oil and mining companies operate transparently, citizens of developing countries become less poor, because they are empowered to hold their governments to account for how revenues are spent. The Prime Minister's recognition of the direct connection between transparency and poverty is very welcome. But companies must be regulated to achieve transparency. The evidence shows that a voluntary approach is bound to fail."
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