Mr Mike Hammah, Minister of Lands and Natural Resources, has said the legislation of the Ghana Extractive Industries Transparency Initiative (GHEITI) is critical for demanding revenue data from the extractive companies.
He identified the reluctance of extractive companies and the national revenue management institutions to disclose their payments and revenue data as one of the implementation challenges facing the initiative.
He named Nigeria, Liberia and Azerbaijan as countries that had legislated the Extractive Industries Transparency Initiative, (EITI) adding that the move had assisted the countries to remove legal obstacles to the implementation of the initiative.
Mr Hammah was speaking at a dissemination workshop organised for the members of the Parliamentary Select Committee on Mining and Energy and the Public Accounts Committee at the weekend, in Dodowa.
The workshop was also to share ideas on the findings and recommendations of EITI reports from 2006 to 2008.
Mr Hammah said: “The issue of the GHEITI legislation is even more urgent now than ever before as we roll-out EITI to the oil and gas sector.”
“The EITI reports, therefore, strongly recommended a legal backing for the GHEITI to ensure that government and all companies disclose their payments and revenue data.”
Mr Hammah said the government has taken note and responded to the findings and recommendations of the EITI reports in the mining sector.
Mr Amponsah Tawiah, Member of the GHEITI National Steering Committee, appealed to the government to use the country’s resource wealth to increase efficiency and equity of public spending and to enable the private sector to respond to structural changes in the economy.
He added that home governments of extractive companies and international capital centres needed to enforce best practices to ensure transparency, accountability and trust.
Mr Tawiah said: “Transparency must translate into improved livelihood for the poor countries where these resources are extracted.
More money from the extractive industry must translate into improved schools, infrastructure, healthcare, more employment, less poverty and less conflict.”
Mrs Efie Simpson Ekuban, Chief Director of the Ministry of Finance and Economic Planning, described EITI as a governance tool aimed at seeking accountability and transparency in utilising the revenue from the extractive sector.
EITI was launched in 2002 at the World Summit on Sustainable Development in Johannesburg, South Africa.
The initiative encourages government, extractive companies, international agencies and NGO’s to work together to develop a
framework to promote transparency of payments in the extractive industries.
EITI therefore seeks to create that missing transparency and accountability in revenue flows from the extractive industry.
It is a voluntary initiative, supported by a coalition of companies, governments, investors and civil society organizations.
Alongside other efforts to improve transparency in government budgetary practices, the EITI begins a process whereby citizens can hold their governments accountable for the use of those revenues.
EITI focuses on both company payments and government revenues and their disbursement.
The GHEITI is the subset of the global initiative aimed at following due process and achieving transparency in payments by extractive industry companies to governments and government-linked entities.
Ghana is considered among the 11 EITI compliant countries and the fifth in the list of countries to attain EITI compliant globally.