Details on local content absent from Guyana’s first EITI report-Minister Trotman promises improvements

May 03, 2019 News

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Guyana’s inaugural report that was submitted to the Extractive Industries Transparency Initiative (EITI) does not contain details on the extent to which companies here utilize local goods and services for their operations.

Speaking at a press conference yesterday at the GY-EITI’s Main Street Office, Natural Resources Minister, Raphael Trotman, sought to remind that this is the nation’s first report and improvements will be made going forward.
He said, “I think there was an expectation that everything under the sun would have been captured in the first report and that was just not possible given the time we had. The Multi-Stakeholder Group (MSG) took a decision as to what it would include as quickly as possible and what it could get.
“So it is not that local content is not important to Guyana but …in our second, third and fourth reports, they will be more illustrative of what is happening in every area including local content.”
Trotman added, “We treat it seriously and I am sure that this is something that will occupy the attention of the MSG.”
Turning his attention to Guyana’s EITI history, the Minister noted that on May 12, 2012, the Government of Guyana signed a Memorandum of Understanding (MOU) with the Extractive Industries Transparency Initiative signaling its intention to pursue membership in the body.
On December 22, 2015, following Cabinet’s approval, Minister Trotman reminded that he had publicly announced the coalition government’s intention to continue Guyana’s commitment to EITI implementation and in February 2017, the GYEITI Multi-Stakeholder Group (MSG) was officially launched with representation from civil society, extractive entities and government agencies.
Trotman said, “I am proud to say that this Multi-Stakeholder Group has equal representation, in true Article 13 fashion, as the government chose not to seek to exercise dominance on and of the group.”
In August 2017, Trotman said that Guyana submitted its application to the EITI International Secretariat, and on October 25, 2017, Guyana was officially accepted as an EITI implementing country.
He said that the Report which was published in conformity with the EITI Standard goes beyond the mere reconciliation of payments, and receipts to include contextual information such as a summary description of the legal framework and fiscal regime, the sector’s contribution to the economy, production and export data, state participation in the extractive industries, revenue allocations, sustainability of revenues, license registers and licence allocations to mention a few.
He said that the MSG agreed on the participating sectors and, though fisheries and forestry were not mandatory, the MSG in the interest of transparency, included these two sectors.
Trotman said that the MSG also agreed to include extractive entities which made payments over the materiality threshold of $75M.
The Minister said, “The identified industries came from the government sector, oil and gas and mining sectors. Twenty-four entities were identified. For the oil and gas, a total of nine companies were identified, and seven participated. The total revenue amounted to $2,638 million – representing 13% of total revenue within the extractive sector.”
Trotman continued, “Reconciliation of revenue for the mining sector amounts to $11,239 million which represents 54% of total revenue generated from the mining sector.
“In 2017, total revenue from the extractive sector amounted to $20,800 million with the Guyana Gold Board accounting for 33% of total revenue streams followed by the Guyana Revenue Authority (GRA) and the Ministry of Finance accounting for 32% and 18% respectively.“
He added, “Very importantly, the report connects dots and points the way forward for better management through greater transparency in the extractive sector and this is the main focus for the government in this process.
“Particularly, it points the way for an improved investment climate; how to assist in strengthening licensing, record keeping and tax collection systems and legal and fiscal frameworks; how to improve reforms and governance as well as promoting greater economic and political stability.”
For companies, Trotman said that the report shows how to mitigate political and reputational risks as well as creating a level playing field in countries of operation and transparency of payments made to investments makes to a country.
He said, “And for civil society, it allows for more information on what is happening in the extractive sector so as to be able to hold government accountable.”
The report has been shared with Cabinet and posted on the Ministry and the GYEITI’s websites.

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