While commodity prices continue to stay low and as more people consider how countries might transition to a “post-extractivism” agenda, should we still be worrying about good governance of oil, gas, and mining?
Yes, judging by the launch last month of multiple new initiatives. These aim to address a range of governance challenges in the extractives sector from the struggle to assess the value of transparency to more effectively navigating political realities.
Is this all merited? We think so. Even at lower prices and with some prospective projects on hold, extractive commodities are still critical to the economies of dozens of countries worldwide. The revenues they do/can generate are more important than ever. Mineral (and gas) products will remain vital even with the transition away from fossil fuels. And the governance challenges undermining sector outcomes remain substantial as confirmed in the 2017 Natural Resource Governance Index where every one of the 89 countries covered has room for improvement and the majority of those deemed resource-dependent score poorly.
We hope these new initiatives help address known problems of translating natural resource wealth into development by building on lessons learned of past transparency and accountability-focused efforts and align with what Tom Carothers has outlined as emergent second generation approaches.. There are reasons for optimism. Transparency and Accountability Initiative members support all these efforts and, indeed, are contributing to several. The Brookings-led project will help strengthen our understanding based on evidence of whether and how transparency initiatives translate into accountability and improved quality of life in resource-rich countries (see details of launch discussion). The World Bank Group project will support and test concrete use of publicly available extractives data, shifting from supply side platforms that risk becoming “white elephants” to verifying what data stakeholders want, in what formats, and to what end. The Project on Resources, Development and Governance will build more iterative engagements between researchers and practitioners that should generate a set of learnings that are much more immediately applicable by practitioners, while the Extractive Industries Executive Session being hosted by the Columbia Center on Sustainable Investment should clarify effective ways to understand local contexts more effectively and generate policy innovations for new approaches given its focus on political economy dimensions.
Is the multiplicity of new projects a problem? It need not be. The needs are wide-ranging. Each project has its own complementary focus that responds to gaps in existing efforts. Together with other funders, we are committed to encouraging connections among the project teams to promote that complementarity. It is encouraging to already see these project teams soliciting inputs and ideas from each other and others in the broader field. Such coordination and collaboration can help make the necessary shift from fragmented to the more strategic, larger-scale efforts necessary in the face of powerful vested interests, engrained ways of operating, and persistent opacity that too often hinder achievement of development outcomes.
In the next three to five years, we hope there will be clear, concrete insights from these investments that can be applied across the sector. We also hope to see increased coordination across these initiatives and less duplication of efforts. Ultimately citizens of resource-rich countries will be the arbiters of our collective success.
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