Who wins if Zim joins EITI?

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RECENT news, which the government has not disputed, suggested that Zimbabwe is not keen on joining the Extractive Industry Transparency Initiative (EITI). By joining EITI, the mining sector — the main engine for economic growth, would have been opened for citizens to question government and industry on how past and current mining deals are best tailored to contribute to Sustainable Development Goals (SDGs). In October last year, the government launched a blueprint to grow mining sector earnings by 344% to US$12 billion in 2023, up from just US$2,7 billion earned in 2017.

Based on past records and the plunder on Marange diamonds citizens have, however, become sceptical that the envisaged mining sector growth will revamp education and health services.

What the country needs is a framework like the EITI to help surface issues, bring sectors together and build trust among them so that they all come up with solutions together.

Given lack of traction on joining EITI, it is pertinent to reflect on the potential governance gains associated with implementation of EITI. Who wins if Zimbabwe joins EITI?

Winner: Government

According to the Transparency International’s 2019 Corruption Perception Index (CPI), Zimbabwe continues to perform badly when it comes to fighting corruption.

With a total score of 24 over 100, Zimbabwe is lowly ranked 158 out of 180 countries by the CPI. Fighting corruption is on the top of government’s agenda; but the public remains sceptical, though.

Joining the EITI will not increase transparency overnight, but it will help the government manage the extractives sector in a more inclusive and transparent manner. Raising transparency will also help minimise speculations and distrust towards the government.
Winner: Host communities, civil society and organizations (CSOs)

Zimbabwe has a lot to work when it comes to citizen engagement. According to the World Governance Index 2017 edition, Zimbabwe scored -1,196 when it came to the “Voice and Accountability” indicator which indicates weak performance.

By joining the EITI, mining communities and CSOs earn a platform to access information and constructively engage with companies and the government.

For a government that seeks to rebrand as a “New Dispensation” and breaking away from old habits of keeping citizens in the dark on mining deals, joining EITI is critical to winning doubters.

Winner: Mining investors, companies

While Zimbabwe was not ranked lowest when it comes to the Mining Investment Attractiveness Index 2018 of the Fraser Institute, it also fares badly on Policy Perception Index compiled by the same institute.

The Investment Attractiveness Index blends mineral wealth potential and policy attractiveness. Joining the EITI can become a game changer for the country as it aims to open the country for business to attract more investments into the mining sector.

Transparency helps level the playing field and ensure that no affiliate of those in power gets more favourable mining contracts. By supporting transparency initiatives, investors can freely compete with one another regardless of affiliation.

It also makes doing business in Zimbabwe less riskier for international investors who are bound by laws on foreign corrupt practices like those in the US and Australia.

Should Zimbabwe join the EITI?

A country like Zimbabwe, whose economy is dependent on its vast mineral wealth, embracing EITI is a critical building block to curb corruption, prove the seriousness of the agenda to open Zimbabwe for business, and to regain public confidence and trust.

Regressive elements in government will always find excuses not to open up the mining sector for public scrutiny.

To prove that this is a new dispensation, actions should speak louder than words. Joining EITI can show that the government is walking the talk.

 Mukasiri Sibanda is an economic governance officer with the Zimbabwe Environmental Law Assocaition

Marco Zaplan is a resource governance and policy specialist working on extractives transparency and data. They both write in their personal capacities.

NEWSDAY

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