Many resource-rich countries are notorious for secrecy, corruption and mismanagement of billions in revenues from oil, gas and mining operations. Ghana has long been a gold producer – and a donor darling for its recent track record of good governance – and in December became Africa’s newest oil producer. There are some encouraging signs that Ghana is building in transparency and accountability measures into the legal framework for managing its oil boom – and some more work to be done.
Last week, President Mills of Ghana signed a recently passed Petroleum Revenue Management Bill into law. The law requires the government to publish information on receipts from petroleum companies – online and in national newspapers – on quarterly basis. The Minister of Finance will be required to reconcile receipts and expenditures and submit reports to parliament and to the public every quarter. In addition, audited statements of Ghana’s oil accounts will be made public this year.
In addition to these transparency provisions, the law will establish a Public Interest and Accountability Committee which will include civil society activists. Some parliamentarians had tried to strip out this provision, but civil society campaigners – led by the Oxfam-supported Civil Society Platform on Oil and Gas – fought successfully to keep it in the final bill. Text messaging and other tools were used to gather over 40,000 petition signatures for delivery to Ghana’s parliament.
Ghana’s new law – combined with new disclosure requirements covering companies registered with the Securities and Exchange Commission (SEC) or receiving World Bank financing – will mean that all foreign companies involved in Ghana’s Jubilee field production will have to disclose their payments to Ghana and Ghana will have to disclose receipts.
Challenges remain. Ghana lacks an independent regulator for the sector and has weak capacity to monitor environmental impacts. Campaigners also want to see Ghana disclose its financial agreements with foreign oil companies. In an interesting twist, all of the petroleum agreements for the Jubilee field are now publicly available as a result of plans by Kosmos Energy, a small US company, to become a publicly traded company. Citizens in Ghana and around the world can now find the contracts on the SEC’s website.
Last month, Oxfam supported the launch of a “Readiness Report Card” by the Civil Society Platform on Oil and Gas in Ghana. The report was launched in Accra, London and Washington and drew hundreds of attendees to the launches and media coverage by Voice of America, BBC, Bloomberg and other outlets. The report measured the readiness of government, parliament and others to manage the boom. The government was graded on 10 indicators – from transparency (a B) to independent regulation (a D).
Overall, Ghana got a C, indicating fair progress. Will Ghana get it right? That remains to be seen. The challenges of turning oil wealth into lasting benefits for the poor are significant, but with the new law Ghana is beginning to set a proper foundation.