EITI is a step forward to improving sector transparency

In August 2020, Uganda was admitted to the Extractives Industries Transparency Initiative (EITI), an international standard for transparency in oil, gas and minerals sub-sectors where payments and receipts in the sector are published and easy to follow up. In June 2022, the Ministry of Energy and Mineral Development, as one of the requirements, published Uganda’s earnings from the sub-sectors. Winfred Ngabiirwe, a member of the local EITI Multistakeholder Group, says the initiative will go a long way in pushing for standards.

Briefly, bring us to speed with the Extractive Industries Transparency Initiative

Uganda joined EITI in 2019 and the processes, as required, have been followed, with the establishment of the Multistakeholder Group (MSG) that has representation from Government, investors and civil society. The MSG oversees its implementation. This year, the country’s first report was submitted, covering the period 2019/2020. The report was launched on June 10, 2022 in Kampala and at sub national levels in the Albertine region, Mbale in eastern Uganda as well as the Karamoja Region.

How significant was Uganda’s joining after several years of lobbying?

The implementation of EITI is a big step towards opening up a sector (extractives) that has largely been opaque; so, that is an important aspect. Reporting requirements of the EITI standard cover a wide range of issues from legal, environmental, civic space, revenue collection, local content as well as gender, among others. All these issues are important for a country like Uganda. So, EITI provides us an opportunity to assess the country’s performance along these issues. Other than assessing performance, EITI is an enabler of change, particularly from the recommendations for change. The recommendations to various agencies maybe for improving practice or introducing/reforming our legal and policy environment. However, being a new programme, EIT1is still not well understood and appreciated; so, we cannot say that we are seeing the desired change yet. For example, there are back and forth discussions on the basic requirements such as contract disclosure and our EITI secretariat is not yet well resourced to handle the mandate effectively.

How is Uganda fairing using the EITI tools?

Uganda submitted her report in early this year, and the country will undergo A validation exercise early 2023. A team of validators will come to crosscheck whether the report is a true reflection of what is on the ground. It is after this validation exercise that we shall know whether we are doing well or not. For now, the discussions and actions within the MSG can be said to be good.

How is the country fairing in the;

a) Mining sub-sector?

The mining sector remains a big challenge, and if you noticed, our first report did not have much information aboutit. For the mining sector, the report relied on information provided by the government, and was not reconciled with information provided by mining companies. This kind of reporting is called Unilateral and is acceptable, but, in my view, it doesn’t tell us much really. However, as mentioned, members are beginning to understand the potential of the mining sector and are also able to question how we can ensure that the sector is open, transparent and bring value to the country.

b) The oil and gas sub-sector?

The oil sector is more organised (and has fewer investors) than the mining one; so, you are dealing with groups that have already available information. Some of the international oil companies are already implementing EITI in other countries where they operate. But that has not made ita straight forward exercise and, as mentioned earlier, there are back and forth conversations on how EITI can be actually implemented, with lots of concerns and expressed from time to time, but that could be understood because we have to domestic the standard and consider local context.

How can the country improve its ranking[s]?

The country’s ranking improves when recommendations from the EITI reports (previous) as well as those from the validation exercise have been implemented. In terms of the regulatory framework for both sectors, is everything needed in place?

The regulatory framework for the oil sector is good enough to support EITI implementation. We also have other enabling laws such as the Access to Information Act that are instrumental for disclosure and openness. The mining sector lacks a robust legal and institutional framework, but with the passing of the Mining and Mineral bill recently, we know that is a good move in the right direction. However, for Uganda, the problem has really never been about lack of law, policies or regulations. The problem is the implementation of these wonderful documents we have on our shelves. So, our challenge as far as I am concerned is lack of political will to invest and let the laws serve the purposes they were enacted for.

How central have NGOs been in pushing for good governance in the sectors?

The work of NGOs cannot be underestimated as their engagements at all levels have and continue to yield tangible fruits. The advocacy efforts towards adopting EITI had gone on for over 13 years from when the National Oil and Gas policy was passed.

The contributions of NGOs around laws to govern both mining and oil sub-sectors, the outreach to communities, government agencies and parliament, have all helped to prepare ground for a well-managed sector. Alot of NGOs are undertaking research that is producing evidence that duty bearers can use to make informed decisions. But also CSOs are aware that the work has just begun; so, we expect that their efforts be doubled so that the sector delivers to the citizens what is expected of it, as ably articulated in our policies and National Development Plans.

Any last word?

NGOs are working in an environment that is getting narrower every day and this is a contradiction of what we would expect in a democratic country that values the contribution of everyone. The Extractives Industries sector is particularly challenging because itis a high stakes sector. With the big dreams and big money in it, there are also bigger risks for human rights violations, corruption and instability. It is important to note that there is appreciation that these resources belong to all Ugandans, and so, the processes along the entire value chain reflect this ownership and benefit sharing is as equitable as it should be.

Article as published in the Diamond Jubilee edition of the Natural Resources Book produced by the Ministry of Energy and Mineral Development (2022)