EITI necessary for transparency and accountability reforms in Zimbabwe mineral resource governance

Publish What You Pay (PWYP) Zimbabwe has noted with regret that the government of Zimbabwe is not keen to join the Extractive Transparency Industries Initiative (EITI). This is based on the newspaper article that was published in the Independent on the 31^st of January 2020. The Minister of Finance in the 2019 Budget Statement mentioned that; “In order to move along with international best practices on achieving transparency in management of natural resources, Government would want to be a member of the Extractive Industries Transparency Initiative (EITI) as soon as possible. Membership is critical in order for the country to benefit from strengthened public and corporate governance, promote understanding of natural resource management, and provide the data that guide reforms for greater transparency and accountability in the extractives sector”. https://www.parlzim.gov.zw/component/k2/2019-budget-speech. However, according to the Zimbabwe Independent, “Hardliners in government, however, believe the initiative is not good, as it was being pushed by Western countries”. https://www.theindependent.co.zw/2020/01/31/ncubes-eiti-move-sparks-cabinet-rift/. We are deeply concerned by the Government’s lack of urgency in aligning the mineral governance framework with the Zimbabwean Constitution and international standards. Transparency and accountability reforms are embedded in our Constitution, the supreme law of the land. Section 298 subsection 1 on principles of financial management, calls for transparency and accountability in all public financial matters. Section 299 talks about parliament oversight on state revenue and expenditure to enhance public transparency and accountability.

In October 2019,the President launched the 12 billion mineral roadmap to the achievement of 12 billion mining industry by 2023.Under the roadmap, gold is expected to contribute $4 billion and platinum’s contribution has been pegged at $3 billion http://www.mines.gov.zw/ . However, without transparency and accountability, achievement of this strategy will remain a pie in the sky. The previous decade clearly shows how Zimbabwe’s extractives sector has been shrouded in secrecy as evident from the Auditor General’s reports.  Lack of transparency and accountability in the management of resources continues to rob the country and especially ordinary citizens, the much-needed resource revenue. Of note, is the alleged missing 15 billion from Marange diamond fields. The annual public report by the Auditor General clearly highlights how public sector mismanagement and deep-seated corruption has affected not only the mining sector but also other sectors as well. Mining contracts are being signed, mega deals being entered into without public scrutiny and parliament oversight. Lack of open contracting has serious implications on benefits to local communities who are the rightful owners of the resources and also revenue allocated to the national fiscus. Transparency International Report ranks Zimbabwe on a scale of 0 (highly corrupt) – 100 (very clean) at 24 out of 100. https://www.transparency.org/country/ZWE.

As the PWYP Coalition we believe that joining the EITI will go a long way towards assisting Zimbabwe in getting maximum benefits from its mineral resources through improved revenue collection from its significant and diverse mineral resource base. The mining sector has been recognized as one of the sectors to revive the economy and issues of management and accountability matter. Other benefits for EITI include fighting corruption, attracting Foreign Direct Investment through international recognition; promotion of transparency and accountability in the sector. Therefore, by adopting EITI the country can acquire resource revenues that can be used for economic development and poverty reduction; promotion of access to information and public participation in the extractive sector; prevention of the ongoing resource conflicts and help in building trust among stakeholders.  While government has put in place the companies Act that requires all companies to be registered addressing issues of beneficial ownership, transparency and accountability reforms are an urgent need the government needs to work on.

We therefore call on government to work on transparency and accountability reforms that promote;

• Revenue transparency and accountability on resource revenues that can be used for economic development and poverty reduction while ensuring that access to information and public participation in the extractive sector is enhanced.