The Conference on Addressing Illicit Financial Flows and Asset Recovery in the Extractive Industries has tasked the Extractive Industries Transparency Initiative (EITI) on the bribery scandal by Glencore in Nigeria and five other African countries.
The Conference, in a communique released on Tuesday at the end of its two-day session in Diamniadio, Dakar, Senegal, asked EITI to publicly call out Glencore for its failure to adhere to the group’s principles and values over its bribery scandal in Nigeria, Cameroon, South Sudan, Cote d’Ivoire, Equatorial Guinea and the Democratic Republic of Congo.
The Conference convened by the Secretariat of the African Union High Level Panel on Illicit Financial Flows and the Working Group on Common Africa Position on Asset Recovery (CAPAR) held parallel to the 2023 Global Conference of the Extractive Industries Transparency Initiative (EITI) on 13th and 14th June 2023 in Dakar, Senegal. The Global EITI Conference is the first ever conference to be held in Africa in spite of African countries being the majority of its fifty-seven member countries which meet every three years.
The Conference on Addressing Illicit Financial Flows and Asset Recovery in the Extractive Industries is aimed at fostering dialogue and collaboration on the promotion of accountability and transparent management of oil, gas, and mineral resources, and was attended by state agencies, civil society organizations, academia and the media. Nigeria’s anti-corruption agency, the Independent Corrupt Practices and Other Related Offences Commission (ICPC) was represented at the conference.
In its 11-recommendation communique, the Conference described the Glencore corruption scandal as a symptom of a widespread and deliberate practice in the extractive industries in Africa.
It stated, “The Conference calls upon the African Union and the governments of the six African victim states to draw upon all the necessary resources for joint and separate judicial action against Glencore and its accomplices.
“The Conference calls upon Transparency International and its partners, Publish What You Pay, and related advocacy Civil Society Organizations to actively engage and support action against Glencore on these six cases. The Conference calls upon EITI to publicly call out Glencore and demand that it publicly demonstrates fidelity to the principles and values that EITI stands for.”
It reminded the EITI of its critical role in promoting accountability and transparency in the extractive sector given that the bulk of illicit financial flows stems out from transactions in the sector.
It added that the EITI should actively take up its role in partnership with the Working Group on Extractives.
It said, “The Conference noted the significant contribution of the extractive industries to illicit financial flows and the attendant impact on African economies. The extractive industries mostly contribute to illicit financial flows through various means including through under-declaration, underpricing and the evasion of capital controls.
“It is further complicated by base erosion and profit shifting practices of Multinational Corporations (MNCs) that misrepresent the value of goods and/or services in order to relocate untaxed profits to their home nations or to financial secrecy jurisdictions.
“The Conference noted that Multinational Corporations in extractive industries also engage in bribery or other corrupt activities to secure mining or drilling licenses, permits, or favourable tax treatment from government officials. Some mining companies also undertake mass exports of mineral ores and crude oil from African countries often disguising and grossly understating the true value of the minerals, precious metals and/or oil in the raw materials that they export for refining.”
On the issue of criminal accountability in the extractive industries, the Conference urged African Union member-states to prioritize ratification of the Malabo Protocol for a criminal jurisdiction for the African Court on Human and Peoples’ Rights.
This, it noted, would strengthen Africa’s own mechanism for criminal accountability in the extractive industries.
The Conference commended the African Development Bank for taking the initiative to put in place the African Integrity Fund but advised the bank to prioritize the operationalization of the fund.
Other recommendations by the Conference include:
That in view of the need for national level responses to the special declaration and the CAPAR, the Working Group on Extractives be urgently reconstituted, and invitations be extended to EITI and Transparency International to join as members
That as the premier policy advocacy instrument for assisting AU Member-States to trace, identify, recover, repatriate and effectively manage their recovered assets, CAPAR should be widely disseminated to sensitize public authorities, civil society organizations, citizens of Africa and the rest of the world, and multilateral organizations.
That the Conference urges AU member-states to actively promote public knowledge of the CAPAR in their jurisdictions and to their international partners, and to take national level actions in line with the CAPAR.
That the Working Group on CAPAR augments the role of investigative journalism in stemming illicit financial flows from Africa, and also initiates a capacity-building programme for the purpose of enhancing the quality of investigative journalism, engaging investigative journalists from and across Africa, researchers, and professionals working with data relating to illicit financial flows especially in asset tracing, recovery, and management.
That the Working Group on CAPAR prioritizes inclusive consultative processes towards the development of a continental framework for whistleblower protection.
The Conference deliberated and agreed on scaling up joint efforts with national anti-corruption agencies and state departments in raising public awareness, tracing, and recovering assets illicitly acquired from Africa through tax avoidance and illegal activities such as tax evasion, money laundering and corruption.
Participants also discussed CAPAR, the need for enhanced transparency and accountability, stricter regulations and increased international cooperation in the extractive industries, in addition to reflecting on how best to engage national authorities, the judiciary and the citizenry to hold the perpetrators and accomplices accountable.
