New European rules move the world closer to a global standard on transparency. Now other regions and countries must follow this example
By requiring oil, gas, and mining companies to disclose full information on payments to governments over €100,000, Europe’s new transparency rules will help Africa to seize more effectively the opportunity of its natural resource wealth.
When local communities know how much business is paying to extract oil, gas, or minerals, they are in a better position to demand a fair share of the revenue. In this way, oil, gas, and mining projects bring more benefits to local communities.
“Extractive companies also benefit from these new rules,” said Kofi Annan, former UN Secretary-General and Chair of the Africa Progress Panel.
“When they benefit local communities, mining projects are more likely to win “social consent”. In the long-run, this reduces political risk,” he said.
By covering more and more extractive companies, recent US legislation and new European rules move the world closer to a global standard on transparency.
“Other countries, such as Canada, China, and Switzerland must now adopt these standards,” Mr Annan said.
The European parliament and member states are expected to endorse the rules before Ireland’s presidency of the European Union comes to an end in June.