You are here: HomeNews2018 01 31Article 622277

Business News of Wednesday, 31 January 2018

Source: citibusinessnews.com

IEA urges more transparency in awarding oil contracts

The Institute of Economic Affairs (IEA) has advocated increased disclosure of oil contracts and licenses if the government is to be transparent with Ghanaians on developments in the oil industry.

This follows a latest accountability and transparency index (P-TRAC) report which focuses on the management of Ghana’s petroleum resources.

The survey assessed the level of transparency by the government in four key areas.

These comprised transparency levels bordering on revenue, expenditure, contract and the management of the Ghana Petroleum Funds (GPF).

Presenting the outcome of the research, Senior Research Fellow at the IEA, Professor John Asafu-Adjaye indicated that largely, managers of Ghana’s oil resources have performed creditably in providing the necessary information to the citizenry.

Citing the recently signed Exxon Mobil agreement, Professor he, however, noted that managers of the resource have not performed too well in being transparent on contracts and licensing.

“A lot of contracts remain shrouded in secrecy but the E and P calls for the publication of contracts although it is not all contracts which have to be revealed because there could be confidentiality clauses. Even with contracts which should be available are still not available and that is what we are calling for,” he explained.

The IEA also disclosed that the rate of transparency in revenue has been remarkable even though it has slowed over the last three years.

This, Professor Asafu-Adjaye attributes to lapses such as the delay in passing the Right to Information Bill as well as the Ghana Extractive Industries Transparency Initiative Bill.

“The EITI requires oil companies to report their revenues and expenditures and the government is also required to do same. Currently, it is on a voluntary basis and that is being done in the extractive industry so Ghana can comply or not. But what we want the government to do is to have it legislated since this will mean that oil companies will have no option than to report their revenue and expenditure to the government,” he emphasized.

In addition, the economic think tank wants government to improve on its information on expenditure of petroleum revenues.

The IEA believes current practice where revenue and expenditure patterns disclosed largely during the annual budgets, is inadequate.

Meanwhile, the economic managers have been given a pat on the back in their management of Petroleum Funds.

Activities like auditing and publishing financial reports, publication of the information on fund activities whether they were used or not, informed the commendation under this category.