NRGI’s Summer School Beams Searchlight on Africa’s Extractive Industries

The Natural Resource Governance Institute, NRGI, has organised a summer school aimed at allowing participants have a deeper understanding of the issues and challenges in the extractive industry within the African region.

“We hope they use the insights to improve upon the existing frameworks in the sub-region,” said Emmanuel Kuyole, Africa Consultant, NGRI.

“The purpose is to develop a regional capacity to provide effective training and mentoring to grow the number of knowledgeable, skilled human resources who are duly equipped to ensure strong oversight and governance of extractive industries and natural resources,” he added.

The summer school is part of the core activities of the African Regional Extractive Industries Knowledge Hub, established by the NRGI in collaboration with the German International Development Cooperation in 2009.

Over the last seven years, over 240 participants drawn from Britain and Iraq, as well as Ghana, Kenya, Nigeria, Zimbabwe, South Africa, Liberia, Sierra Leone, and several other African countries have attended the school.

About 45 participants from across Africa took part in this year’s training, a two-week intensive programme that included a field trip to the Ghana National Gas Company facility.

About a dozen experts in oil, gas, and mining sector participated as resource persons in the two-week programme.

Dauda Garuba, a consultant to the NGRI urged African countries to put in place a demonstrable solid strategy to deliver on set goals.

“Regardless of the diversity of the political economy direction in resource governance, countries should make conscious efforts to prevent an enclave economy as a safeguard against volatility,” said Mr. Garuba.

“They should also ensure a creation of necessary business incentives without giving in to abuses and embrace an effective revenue management regime that makes resources work for the citizens’ sustainable development.”

Mark Evans, Programme Manager at Ghana Oil and Gas for Inclusive Growth, said a prudent management of revenues from the extractive sector would help avoid the Dutch Disease factor – a phenomenon whereby sharp inflow of foreign currency ensues- such as a discovery of large oil reserves.

“Resource revenues are potentially very large, volatile and will run out,” Mr. Evans said.

“This can hold back broader development, create macroeconomic instability, leaving little for future generations.”

Samuel Bekoe, a resource governance consultant, identified corruption, tax avoidance or evasion, and contract secrecy as among the factors responsible for countries earning lower revenues than expected from their extractive industries.

Out of 45 cases of alleged corruption in the extractive sector gathered by the NRGI, 28 resulted from cases of hidden ownership.

Some of the ways extractive companies conceal their beneficial owners, according to Mr. Bekoe, include substituting natural persons, inserting opaque entities as shareholders, and holding assets and sending the payments offshore.

For instance, in the Malabu Oil scandal in Nigeria, the company included in its list of directors, a fictitious Port Harcourt-based Ghanaian, Kweku Amafagha.

Godwin Ojo, Executive Director of the Environmental Rights Action, said most Environmental Impact Assessment, EIA reports required before major projects are done to “fulfil all righteousness” and fend off resistance from activists and host communities.

“Despite the salutary provisions of regulation EIA Act, in practical terms, public projects by federal, state and local governments have often failed to comply with the requirements of the Act,” said Mr. Ojo.

“Reasons for non-compliance are numerous and range from the need to avoid delays to public interest projects such as major infrastructure, the lack of competence of EIA consultants, the lack of capacity and unwillingness within the Federal Ministry of Environment to enforce the provisions of the Act.”

In her keynote address at the opening ceremony of the programme, Barbara Oteng-Gyasi, Ghana’s Deputy Minister of Lands and Natural Resources, said a clear understanding of the extractive sector would help facilitate an optimal creation and distribution of the benefits.

“The limited, and sometimes even lack of the requisite knowledge or expertise in these matters had led to countries across the continent that are endowed with mineral, oil and gas resources being short-changed in terms of benefits derived from their resources,” said Ms. Oteng-Gyasi, who was represented by an official of Ghana’s Lands Ministry, Ben Aryee.

“It is in this context that African leaders, under the auspices of the Africa Union and UNECA, adopted the Africa Mining Vision aimed at a ‘Transparent, equitable and optimal exploitation of mineral resources to underpin broad-based sustainable growth and socio-economic development’ in 2009.”

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