Extractive Industries Transparency Initiative: Civil Society Participation October 21, 2005, Ulaanbaatar, Mongolia Bermet Sydygalieva

EITI: Background Launched by UK Prime Minister Tony Blair in September 2002 Launched by UK Prime Minister Tony Blair in September 2002 Multi-stakeholder approach Multi-stakeholder approach Increases Transparency and Accountability Increases Transparency and Accountability Incentives for: Incentives for: Countries (increased growth, better investment climate, less poverty, corruption and conflict) Countries (increased growth, better investment climate, less poverty, corruption and conflict) Companies (reduced cost of capital and access to market, better investor relations) Companies (reduced cost of capital and access to market, better investor relations)

What is EITI? Process SIGN UP: Government makes public statement Stakeholders identified – government, civil society, all extractives companies Initiating conference held SET UP: Multi-stakeholder committee formed Basic procedures for EITI agreed and workplan developed PROCESS DEVELOPMENT: Technical assistance needs identified and secure financing and support found Select independent administrator to reconcile figures to international audit standards DISCLOSURE AND PUBLICATION: Design reporting template Companies and govt submit data to administrator Ensure data is to international standards PUBLIC DISSEMINATION AND DISCUSSION: EITI Report published, identifying any discrepancies Administrator makes recommendations to improve process Stakeholders review data REVIEW: Review process and make improvements Workplan reviewed Regular reporting continues

What is EITI? 1. Regular publication of all payments by companies and all revenues received by governments 2. Payments and revenues are the subject of a credible, independent audit 3. Payments and revenues are reconciled by a credible, independent administrator 4. Includes all companies including state-owned enterprises 5. Civil society is actively engaged 6. A public, financially sustainable work plan Criteria:

Local and state Companies Multinationals Implementing governments Local civil society groups Intl organisations IFIs Donors Investors Intl civil society groups Who? EITI Stakeholders

Who? Organising EITI UK government has given Political leadership UK government has given Political leadership Policy development led by UK and World Bank (with IMF) Policy development led by UK and World Bank (with IMF) Dialogue with Stakeholders informally through UK Core Group and formally through EITI Conferences Dialogue with Stakeholders informally through UK Core Group and formally through EITI Conferences Support to implementing countries from World Bank and DFID Support to implementing countries from World Bank and DFID Financing through multi-donor trust fund in the World Bank Financing through multi-donor trust fund in the World Bank

Types of assistance for implementing countries Advice, stakeholder management. Advice, stakeholder management. Capacity building for government. Capacity building for government. Capacity building for civil society. Capacity building for civil society. Funding of administrator / auditor costs. Funding of administrator / auditor costs. Project management costs. Project management costs. Publication and dissemination costs. Publication and dissemination costs. Around 20 countries now at various stages of implementation. Around 20 countries now at various stages of implementation.

Development Grant Facility (DGF) World Bank capacity building tool World Bank capacity building tool Funded by the World Bank’s own budget Funded by the World Bank’s own budget Grants to civil society to enhance its participation in EITI implementation Grants to civil society to enhance its participation in EITI implementation Annual budget of $500,000 for all implementing countries (about 20) Annual budget of $500,000 for all implementing countries (about 20) Country needs to be ready to commit to EITI to enable DGF disbursement Country needs to be ready to commit to EITI to enable DGF disbursement

DGF requirements Established legal entity status, Established legal entity status, Program suggestion (focus on capacity building) Program suggestion (focus on capacity building) Description of the organization (financial probity, history of achievement in program area) Description of the organization (financial probity, history of achievement in program area) Budget - itemized Budget - itemized Bank funds should usually not exceed 15% Bank funds should usually not exceed 15% Audit required for grants over $50K; requirement waived for grants under $50K Audit required for grants over $50K; requirement waived for grants under $50K Disengagement plan (3 years) Disengagement plan (3 years) Key staff (include resumes) Key staff (include resumes)

DGF process Submit project proposal to the Bank Submit project proposal to the Bank Internal Bank review, incl. legal Internal Bank review, incl. legal If approved, Grant Agreement to be signed between Bank and recipient If approved, Grant Agreement to be signed between Bank and recipient Disbursement of funds Disbursement of funds DGF Project Implementation DGF Project Implementation Recipient to provide interim and final project activity and financial reports Recipient to provide interim and final project activity and financial reports

DGF: Important deadlines Dec 31, Grant Agreements finalized Dec 31, Grant Agreements finalized Mar 31, Grant Agreements effective Mar 31, Grant Agreements effective May 31, DGF funds disbursed May 31, DGF funds disbursed Dec 31, DGF projects completed Dec 31, DGF projects completed

DGF: Contact Info Bermet Sydygalieva: Bermet Sydygalieva: Tel: 1 (202) Tel: 1 (202) Fax: 1 (202) Fax: 1 (202) EITI Web Site: EITI Web Site: