Vietnam feasibility study - EITI

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EITI report of Nigeria indicates a discrepancy between what the company claim to pay to the
government and what the Central Bank of Nigeria announces to receive from the company, of
230 million naira. After undertaking further audit by comparing receipts and explanatory report,
the discrepancy was reduced to 8.5 million naira (RWI, 2008). Therefore, the EITI report helps the
government to recover substantial revenues.
3. Reinforce broader anti-corruption and good governance agendas. Effective EITI programs can make
corrupt practices more difficult to hide. By promoting transparency in an area where secrecy is
often the norm, EITI participation can help establish precedents for improving transparency in
other areas of government.
4. Build citizen trust in public institutions. When elected officials use EITI to promote openness and
public discussion about how the government receives and spends revenue, citizens may feel
empowered and better connected to the policy process; more confident that their interests will
be taken into consideration in government decision-making; and more likely to believe that they
can play a role in holding their government accountable.
5. Promote reduced hostilities between governments, companies and communities or citizens. Extractive
industries tend to be disruptive to the communities in which they operate. Since they involve
physical upheaval of land and workers from outside the community (and sometimes outside the
country), there tends to be hostility, in extreme cases leading to conflict. The government and the
companies often blame each other. Transparency can build trust among these actors, and EITI
can create a safe forum for dialogue, understanding and resolution.
6. Improve the investment climate. A country’s implementation of EITI sends a signal to international
investors and companies that the government is committed to strengthening transparency and
accountability. The country may be perceived as a more attractive destination for investment,
which may spur economic growth in other sectors. In the longer-term, access to cheaper capital
may increase as the country’s risk ratings improve. For instance, after deciding to implement the
EITI in 4/2010, Moody’s Investors Service upgraded the sovereign debt of Indonesia from Ba2 to
Ba1, which resulted in Indonesia being just below the BRIC nations of India and Brazil. In 2/2011,
Fitch Ratings upgraded Indonesia’s sovereign rating outlook to BB+ positive from BB+ stable.
In order to assess the benefits of implementing EITI, RWI has carried out a survey on the opinion of the
civil society in 24 EITI implementing countries. The findings indicate that the most visible benefits are the
increase of the dialog between stakeholders accounting for 92% of the respondents’ opinion and access
information on government revenues (71%) (RWI, 2011). Other benefits derived from implementing EITI
include greater political stability and improvement of the investment climate (Fig.6).
Increased dialogue between stakeholders
Increased or improved public access to
information on government revenues
Increased trust between stakeholders
Strengthened govermance and management
of the extractive industries
Strengthened accountability of the
govermment for extractive revenues
Prevention and/or resolution of conict
based around the extractives sector
Greater economic and political stability
Improved investment climate
The Extractive Industries Transparency Initiative and the Implementation Perspective of Vietnam
0 5 10 15 20 25
Figure 6. Benefits of implementing EITI