Financial Transparency Coalition

LONDON - Ahead of Thursday’s meeting of the European Parliament's Legal Affairs committee, Global Witness staged a parade of “dictators” in protest at plans to water down upcoming European laws to make oil, mining and timber companies more transparent about the billions of dollars that they pay in revenues to countries around the world. Time and time again Global Witness has highlighted how opaque money flows get squandered and embezzled, leaving ordinary citizens mired in poverty.

Today is not just Tax Day in the United States. It is also the first anniversary of the deadline for the SEC to issue rules on Dodd-Frank Secti0n 1504 – the breakthrough transparency provision for the oil, gas, and mining sectors. Task Force Managing Director Tom Cardamone, as a guest post at Trust Law, writes,

It’s an interesting time for east Africa. Until recently, no one believed it had much energy wealth at all—6 billion barrels, tops, compared to its western counterpart, which boasts at least 60. But the times they are a-changin’. At the end of last month, Kenya sent the world and the markets a buzz when the government announced Canada’s Africa Oil Corp discovered oil in the northern region of Turkana. Given the geographical proximity and similarities, this discoverey also has implications for Ethiopia. And additional discoveries have already been made in neighboring Tanzania and Mozambique. The oil strike in Turkana does...

Too often, borrowed monies are salted away from Africa’s most impoverished nations to offshore banks through inflated contracts or kickbacks. The complexities and bank-secrecy laws of the international finance system, combined with a lack of enforcement, assist such transfers, contend James K. Boyce and Léonce Ndikumana, authors of Africa’s Odious Debts: How Foreign Loans and Capital Flight Bled a Continent. They point to a correlation between foreign borrowing and capital flight: “For every dollar of foreign borrowing in sub-Saharan Africa, on average more than 50 cents leaves the borrower country in the same year.” Capital flight from sub-Saharan Africa...