Revenue Watch Institute (2009) ‘Contracts Confidential: Ending Secret Deals in the Extractive Industries’

Precept 2 states that successful natural resource management requires government accountability to an informed public. Transparency is therefore of crucial importance. The report by Revenue Watch Institute (RWI) provides support for contracts between governments and mining companies to be made transparent.

The case is made by RWI that contract transparency is critical for improved resource management and contract stability as well as a precondition for the even distribution of benefits from the extractive sector. Transparency in contracts provides a strong incentive for government not to make bad deals due to incompetence or corruption and strengthens their bargaining position. For citizens it allows a better understanding of the nature of the agreements and the information to hold government to account. In turn, companies benefit from greater confidence in the stability of contracts.

However, there is often resistance to contract transparency from mining companies, citing the importance of commercially sensitive information. This is paradoxically combined with a practice of often sharing contracts among competitors in large contracts and relatively unrestricted internal dissemination. Resistance is also found in government as secrecy also hides mismanagement, incompetence and corruption. However, it does so only from the public and not the resource industry which gets to know the practices of government. 

 

Access the report here.

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