'More transparency' needed in natural resource governance

Oil well workers (generic)
Image caption The 58 countries surveyed produce 85% of the world's oil

More transparency is needed in how natural resources are managed around the world, according to a report.

The Revenue Watch Institute said 32 out of 58 countries did not meet "basic standards of resource governance".

Revenue Watch says revenue from oil, gas and minerals can create huge natural wealth.

But this is not always converted into human prosperity because of "mismanagement, a lack of transparency and corruption".

"We're talking about whether the huge contracts and revenues to dozens and dozens of countries are transparent - not only are they opaque but are they corrupt - and whether the citizens get to know and benefit from the trillions of dollars," Revenue Watch president Daniel Kaufmann told the BBC.

"There are billions of people who are poor but who live in the midst of natural wealth."

He points to Nigeria as an example. In 2011 oil revenues in the West African country were about $70bn (£46bn), some 60% higher than total international aid to all of sub-Saharan Africa.


The 58 countries in the study produce 85% of the world's oil, 90% of diamonds and 80% of copper.

Revenue Watch measured countries' resource management performance by looking at areas such as reporting practices, quality control, legal settings and government effectiveness.

Eleven countries scored above 70 on the index - indicating a satisfactory performance.

Norway had the highest score, while the US, UK, Australia, Brazil, Mexico, Canada, Chile, Colombia, Trinidad and Tobago, and Peru also fell into this category.

Fifteen countries were identified as failing, scoring below 40. Seven scored below 30: Burma (also known as Myanmar), Turkmenistan, Equatorial Guinea, Libya, Qatar, Iran and Cambodia.

Being a rich country did not necessarily mean a better performance, said Mr Kaufmann, citing Qatar as ranking 54th out of the 58 countries.

"It is not just the responsibility of governments in developing countries [to improve transparency] but also governments in rich countries and multinational corporations, particularly in the oil sector, that haven't embraced transparency as yet," he said.

"Improving the management of natural resources is the most important development challenge of this decade."

The group is calling for full public disclosure of contracts signed between governments and extracting companies, and greater transparency on revenues.

It also urges state-owned companies to be more transparent and wants a more concerted effort to control corruption through rule of law and a guarantee of civil and political rights, "which is often absent in many countries that are natural resource rich".

Revenue Watch is a non-profit organisation that promotes the effective, transparent and accountable management of oil, gas and mineral resources.

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