Access to clear, reliable, timely and useful extractives information is crucial at the local level. This isn’t only because the impacts of the industry are more strongly felt at the subnational level. In many countries, local governments receive a significant portion of extractive revenues.
The new EITI Standard recognizes this. Countries are now required to disclose subnational-level data. At least six EITI implementing countries are undertaking the implementation of subnational versions of EITI multi-stakeholder groups. Some of them, like Ghana or Mongolia, have been making progress for several years. Others, such as Peru and Madagascar, are just beginning.
For an initiative that seeks to empower a range of stakeholders and promote accountability, engaging in this dialogue at the subnational level represents an essential breakthrough: the EITI initiative brings together the supply of extractive information and the demand for such relevant information (and for inclusion in policy debates) from the impacted areas.
Realizing the importance of this topic, the EITI Global Conference, which took place in Lima this February, included a panel where the government, civil society and companies involved in subnational EITI processes in Ghana, the Philippines, Madagascar and Peru shared their perspectives and lessons.
Different actors’ commitment to improving information at the local level was clear. Implementation, though, takes diverse forms. In some cases, such as Ghana and Indonesia, local governments have a seat in the national EITI multi-stakeholder committee. In others, namely in Peru and Mongolia, subnational multi-stakeholder committees have been developed. Madagascar also plans to follow this route of developing a local multi-stakeholder committee.
To be clear, irrespective of the MSG process, all EITI countries are required to report on detailed subnational-level information. But the topics covered are heterogeneous. In most cases, the focus is on resource revenue transfers made by the central government to regional or local-level governments. This is required to be disclosed to ensure that these levels of governments are getting the share allocated to them. All EITI countries are also required to include information on payments made by companies directly to subnational governments, as well as mandatory social expenditures by extractive companies. Some countries have also chosen to disclose voluntary social expenditures and the agreements signed between companies and local actors. Peru reporting emphasizes how extractive revenues are spent, while action plans in Ghana, Mongolia and Madagascar include local content, human rights, local consultation and environmental payments.
Despite diversity in the implementation of subnational-level multi-stakeholder groups and information disclosures in EITI, there are nevertheless some lessons that should be taken into account for countries that plan to include subnational EITI. First, the decision on the territorial scope and the specific topics to be disclosed must respond to the reality of each country, the levels of competence of local governments and, essentially, what the citizens in the territory are demanding in terms of access to information on the extractive industries. This is the guarantee of a relevant, sustainable and useful subnational EITI for the people on the ground. Second, beyond providing information, subnational EITI processes are also an opportunity for companies, government and civil society at the local level to come together and create a multi-stakeholder platform that can potentially take on additional roles. Some innovative examples of roles taken on by local MSGs are developing local plans in Indonesia, monitoring local impacts of extraction in Philippines and monitoring resource revenue transfers and budgets in Peru. Third, to implement subnational EITI, the capacity of civil society at this level and adequate support from the national level is essential to ensure the dissemination and use of information and to ensure ownership by citizens.
Recent NRGI analysis of subnational transparency efforts including through EITI is available here.
Ana Carolina González Espinosa is an associate researcher at the Universidad Externado de Colombia and an EITI board member. Claudia Viale is a Latin America officer with NRGI.