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Mozambique recognised by the EITI Board as having made meaningful progress, highlighting areas where more is needed

Mozambique recognised by the EITI Board as having made meaningful progress, highlighting areas where more is needed

25 October 2017 – The EITI Board today declared that Mozambique had demonstrated meaningful progress in implementing the EITI Standard. In making its decision, the Board took special note of Mozambique’s efforts to embed transparency provisions in the 2014 Petroleum and Mining Laws, which include provisions on contract disclosure, and the establishment of a public mining license cadastre. The Board encouraged the country to “implement this statutory openness through accessible, regular disclosure of information on the sector to its citizens.”

See the full Board decision on Mozambique here.

According to the Validation report, “Some of the key issues in the sector that the EITI has the potential to address include ensuring that the state’s participation in the sector is managed in a transparent and accountable manner, monitoring of legal provisions related to disclosure of contracts, subnational transfers to communities and local content, highlighting the necessary data to address transfer pricing and trade misinvoicing and ensuring  a level playing field for companies and investors.”

Making the most of the EITI for improved sector governance

Following the announcement of the decision, Fredrik Reinfeldt, Chair of the EITI, said: “In the face of challenges including declining commodity prices and a public debt crisis, Mozambique has made efforts to embed transparency provisions in extractive sector legislation. Ensuring that these are implemented will require strong government commitment. Further efforts will also be needed to ensure further transparency in the areas where it is most needed: state participation in the extractives and the relationship between the state and state-owned enterprises.”

Eddie Rich, Deputy Head of the EITI and Regional Director, stated: “Mozambique’s Validation has demonstrated that the EITI has contributed to technical improvements to record keeping and revenue collection systems. There is potential for the EITI to have a wider impact on improved natural resource governance and to make it a more effective tool in addressing key sector priorities. The corrective actions set out by the EITI Board are a starting point to make this happen, and it will be up to the government to take leadership.”

Recommendations and next steps for EITI in Mozambique

Validation put the spotlight on the need for more clarity about the participation of the State in the oil, gas and mining sectors and the revenues that accrue from those activities to the State budget. It has further highlighted opportunities to bring more transparency about how licences are allocated. The EITI Board has outlined 19 corrective actions that Mozambique will have to address in the coming 18 months, when progress will be re-assessed.