History Of EITI

In the late 1990s and early 2000s, there was an expanding library of academic literature around the resource curse by such acolytes as Jeffrey Sachs, Joseph Stiglitz, Terry Lynn Karl and Paul Collier detailing how the huge potential benefits of oil, gas and mining were not being realised and were associated with increased poverty, conflict and corruption.

The problem went beyond just the well-known economic phenomenon of ‘Dutch Disease’ by which natural resource wealth made other export sectors uncompetitive. Other common effects were around the capturing of the revenues by elites, the stunting of the development of tax systems to capture revenue from non-extractive sectors, exacerbated regional and community tensions.

These writings outlined out the complexities of the governance of extractive resources – from bidding, exploration, licenses, contracts, operations, revenues, supply chains, local content, transit, services, allocations, and spending. They noted environmental, social and political concerns. They each outlined remedies for addressing the curse, often noting that no single action would be capable of tackling all these challenges. However, the literature was clear – transparency and dialogue had to be part of the starting point.