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Transparency On Revenue From Extractive Industries Would Reduce Corruption – EITI Member 

Interviewed by Yerima Kini Nsom

CameroonPostline.com — Richard Ndi Tanto, a member of Cameroon’s Extractive Industries Transparency Initiative, EITI, Committee, says declaration of revenue paid by companies operating in the sector would greatly reduce corruption. In this interview, Tanto, who is also the Director of the Ecumenical Service for Peace, SEP, says if Cameroon is granted an EITI compliant status, the country would be credible in the eyes of potential investors.
 

The Post: There has been much talk about Extractive Industries Transparency Initiative, EITI. What exactly is it?
 

Richard Ndi Tanto: EITI is an international norm for transparency in the extractive industries sector. Countries that are rich in resources voluntarily adhere to the norm. By the exigencies of EITI, a member country accepts to declare all revenue it receives for extractive companies and the companies in any member country accept to declare what they pay to government in form of taxes.

These declarations are made to an independent consultant who is recruited by the EITI committee. The duty of the consultant is to compare what has been declared by companies as taxes to government and what government entities responsible for tax collection have declared to have received from these companies. The declaration by government and companies are made on accounts that are audited following international standards
 

What is the origin of this norm and when did Cameroon became part of it?
 

The origin of EITI can be traced to the paradox of plenty. It was observed that countries that are rich in petroleum and mining resources, especially in the third world, were associated with conflicts, hunger, wars, poverty, leading to underdevelopment. These riches were not reflected in the standards of living of the populations of these countries. In an attempt to reverse the situation, former British Premier Tony Blair, during the World Summit on Sustainable Development in Johannesburg in 2002, proposed the EITI as a strategy to bring about transparency in extractive industries sector.
 

In 2005, it was recognised as a norm in the London Conference and countries were called upon to adhere. Cameroon adhered in 2005. That means that Cameroon was ready to declare what it was receiving from extractive industries in form of taxes and royalties.
 

How is Cameroon organised to complement this norm?
 

First, Cameroon created what is called the EITI Committee which is made up of companies that are operating in Cameroon, the government and the civil society. Secondly, it created the technical secretariat which has the same tripartite membership – government, companies and civil society. The secretariat is in charge of preparing documents on EITI (working group) and the committee is the decision making organ of the initiative. The two organs worked together to promote transparency while ensuring checks and balances.
 

Would you say there has been transparency in the extractive industry in Cameroon because of EITI?
 

Cameroon is making progress towards transparency in disclosure of resources coming from extractive industries. Cameroon published its first conciliation report that covered the period 2001 to 2004. The second conciliation report covered the period 2005 and the third report covered 2006 to 2008. The most recent report covered the periods 2009 to 2010.
 

After publishing its first three reports, Cameroon went in for EITI validation in 2010. Validation means examining Cameroon’s reports on the basis of the criteria for transparency developed by EITI. The results by the validation revealed that Cameroon did not satisfy all the criteria for transparency because of three main reasons. Firstly, not all companies participated in the conciliation, secondly some government departments did not participate and finally, there was little or no communication on the reports that were published.
 

Cameroon failed to reach the compliant country status twice. Was it for the same reason?

The reasons were the same, but we were given the status of a country close to compliance in Dar Es Salam by the board of EITI. Cameroon had to go back to work to rectify the weaknesses that were identified with its reports.
 

How are you trying to overcome the problems that caused the country to fail twice?

 In preparing the report for 2009 and 2010, Cameroon took into consideration the recommendations that were made by the international secretariat. Cameroon carried out a scoping study to identify companies to be included in the conciliation. 17 companies were included in the scoping study.

These included the National Hydrocarbon Corporation, four mining companies, five petroleum companies in production phase, eight private companies in exploration phase and three private companies which do not have physical presence in Cameroon. Five Government entities were included in the conciliation. On the basis of the scoping study, the EITI committee defined the perimeter for conciliation which stood at FCFA 50 million.
 

 What is a perimeter in this context?
 

The perimeter defines the amount of money which qualifies a company to be included in the conciliation. By that definition, any companies paying amounts below FCFA 50 million were not considered in the conciliation. However, to ensure transparency, amounts paid in by companies below FCFA 50 million were included in the reports of 2009 and 2010. The total of the amounts paid by these companies did not influence the conciliation. 
 

Cameroon identified focal point in the different companies and government departments involved in EITI conciliations. Cameroon also came up with a communication strategy to disseminate information on EITI reports in a manner that could provoke public debate on extractive resources. In all, Cameroon has made deliberate efforts to be transparent and this is reflected in its 2009 and 2010 reports.
 

Did you notice any discrepancies in what the companies declared and what government department are said to have received?
 

Yes, there were disparities in the amounts declared by companies and received by government. These discrepancies were less than 0.5 percent of the total amount reconciled. The conciliator explained the origin of the discrepancies. In terms of volumes of petrol that were produced, there was no discrepancy between what companies declared and what government received.
 

With all what has been done, are you optimistic that the EITI board will give Cameroon the pass mark as a compliant country?
 

I am very convinced that Cameroon will be given the status of a compliant status because it has taken into consideration the recommendations made by the international secretariat. Secondly Cameroon has taken the EITI to the National Assembly as a prelude to making the norm a national law. Thirdly, Cameroon is producing varieties of sensitization gadgets to inform Cameroonians on revenues from extractive sector.
 

The committee has earmarked April and May 2013 for general sensitization in all the 10 regions of Cameroon. All of these are efforts towards bringing information on extractive industries to the door steps of Cameroonians.
 

What would be the ripple effects of compliancy?
 

First, a complaint status will give Cameroon credibility and attract investments in that sector. Secondly, information about revenue from extractive industries will be available to Cameroonians because Cameroon will be carrying out conciliation every year. Thirdly, it will reduce the incidence of corruption because EITI lenses are on all the stakeholders in the extractive industries. With the information on revenues from the extractive sector, Cameroonians will be justified to ask their government to account for the use of these revenues.

First published in The Post print edition no 01424
 

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