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EITI assessment identifies mining governance shortfalls in Solomon Islands

8 March 2017

Board concludes that the country has made inadequate progress against the Standard. 

Wednesday 8 March - The EITI Board has assessed that the Solomon Islands has made inadequate progress in implementing the EITI Standard. Consequently, the country is suspended from the EITI and must undertake corrective actions. This decision was made by the EITI Board on 8 March 2017 at its meeting in Bogota. The Validation of Solomon Islands resulted in an assessment of inadequate progress in 11 out of 33 requirements.

While the country has published three EITI Reports since joining the EITI in 2011, the quality of EITI reporting has deteriorated. Despite a small mining sector with only two active exploration companies, data collection remains challenging because of poor record keeping and reluctance of companies and government to disclose data. For the 2014 EITI Report, there was no participation at all from any company. At the time of Validation, the only two mining companies in the country, Axiom Mining and Sumitomo, were denied licenses by the High Court. The uncertainty of their status contributed to their lack of engagement in the EITI process. Capacity constraints on the part of all constituencies have also hindered effective implementation.

Despite these shortcomings, the EITI Reports still provide useful assessment of the sector, highlighting some issues in the management of the mining sector that could be improved. This includes deficiencies in the legal and regulatory framework and licensing procedures, the ability to monitor and control production and exports, erratic revenue transfers to landowners, and procedural issues related to agreements between landowners and companies. EITI could play a role in supporting the government with undertaking these reforms.

Solomon Islands was directed by the Board to implement a set of corrective actions including producing a time-bound action plan to make sure that government, companies and civil society are fully, actively, and effectively engaged in the EITI process. The Board expressed its hope that the country would quickly be able to address these issues.

Progress on the corrective actions will be assessed in a second Validation commencing on 8 March 2018.