Following the conclusion of Mozambique’s Validation, the EITI Board concludes that Mozambique has made meaningful progress overall in implementing the EITI Standard. The Board recognises Mozambique’s efforts to embed transparency provisions in the legal framework governing the extractive sector, in the face of challenges including declining commodity prices and a public debt crisis. The Validation has demonstrated that the EITI process has provided useful information to the public domain and has contributed to technical improvements to record keeping and revenue collection systems.
The Board recognises Mozambique’s achievement of satisfactory progress on requirements of the EITI Standard regarding the engagement of civil society (1.3), the EITI work plan (1.5), legal and fiscal framework and policy on contract disclosure (2.1 and 2.4), exploration, production and export data (3.1, 3.2 and 3.3), comprehensive disclosure of revenues (4.1), disaggregation and data timeliness (4.7 and 4.8) and documenting outcomes and impact of implementation (7.4).
In making its decision, the Board takes special note of the Government of Mozambique’s efforts to ensure transparency provisions in the 2014 Petroleum and Mining Laws, which include provisions on contract disclosure and the establishment of a mining license cadastre. The Board encourages it to implement this statutory openness through accessible, regular disclosure of information on the sector to its citizens.
The Board notes the signs of renewed government commitment in taking the EITI process forward, which should result in stronger country ownership of the EITI and make it more effective in Mozambique.
Validation put the spotlight on the need for more comprehensive disclosures of 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 Board encourages Mozambique to progress their efforts to ensure that the transparency and accountability frameworks for the sector are implemented and to bring beneficial ownership disclosure to the sector. This will take strong government leadership.
Validation has also demonstrated that there are opportunities for stakeholders, in particular government and industry, to further use the EITI to address what they have identified as key challenges in the extractive sector. It has highlighted that the ongoing efforts to institutionalise the EITI, to set up an e-reporting system and to mainstream the EITI, can provide opportunities for further engaging industry in the process. The Board therefore encourages Mozambique to make progress on its efforts to refresh its multi-stakeholder group and to use the EITI to inform reforms in the sector.
The Board has determined that Mozambique will have 18 months to carry out corrective actions regarding the requirements relating to government and industry engagement (requirements 1.1 and 1.2), MSG governance (1.4), license allocations and register (2.2 and 2.3), state participation (2.6), in-kind revenues, barter agreements (4.3), transportation revenues (4.4), state-owned enterprises transactions (4.5), direct subnational payments (4.6), data quality (4.9), revenue management and expenditures (5.1), subnational transfers (5.2), mandatory social expenditures (6.1), quasi-fiscal expenditures by state-owned enterprises (6.2) economic contribution (6.3), public debate (7.1) and follow-up on recommendations (7.3). The Board believes that this will help build trust in the sector and the wider economy, demonstrate the commitment of all stakeholder groups to transparency and accountable management of the country’s natural resources, and ensure that there is reliable information available to help inform public debate and policy discussions related to the extractive sector.