WASHINGTON, DC — Representative Christopher Shays (R-CT) announced his support for the Extractive Industry Transparency Disclosure (EITD) Act of 2008 on Wednesday. This legislation would require oil, gas, and mining companies to publicly disclose payments made to foreign governments.
The EITD Act, introduced by House Financial Services Committee Chairman Barney Frank (D-MA) last May, aims to reduce corruption and insecurity in the oil, gas, and mining industries. With more than half of the world?s poorest people living in countries rich in natural resources, this legislation would provide citizens with vital information to hold their governments accountable for how these revenues are used.
?Oxfam America applauds Congressman Shays for supporting this effort to foster accountability in nations where secrecy has undermined development, democracy, and human rights,? says Raymond C. Offenheiser, president of Oxfam America, an international relief and development organization. ?It is no secret that lack of transparency in the extractive industries often goes hand-in-hand with government corruption and internal conflict. The industry suffers as a result with company investments at risk and higher energy prices for consumers.?
With record high oil prices and diminishing reserves, companies are increasingly operating in new areas of developing regions, including West Africa, the Amazon rainforest, and Southeast Asia. Given the weakness of government oversight in many of these countries, it is even more important that oil and mining companies be transparent. In Angola, for example, more than $4 billion in state oil revenues could not be accounted for between 1997 and 2002 ? an amount roughly equal to the entire sum spent on social programs by foreign donors and the government in the same years.
?Mandatory revenue disclosure has the power to weed out corruption in developing countries making way for stability and real solutions to poverty that the oil, gas, and mining industries can support,? says Offenheiser. ?If communities know how much extractive companies are paying their governments for natural resources, they can advocate for a fair share of the benefits to address community needs like education, health care, and jobs.?
The EITD Act would apply not only to US companies, but to all oil, gas, and mining companies registered with the US Securities Exchange Commission (SEC). This includes European companies, such as Shell and BP, as well as those in emerging markets like China, India, Brazil, and Russia.
?This legislation is an opportunity for the US to take leadership in the international community,? said Offenheiser. ?Representative Shays is supporting an important step toward ensuring that communities know how mining and oil projects will impact their lives and lands and how money generated for their governments can contribute to the long-term reduction of poverty.?