The Bank’s work in the extractive industries sector focuses on three main pillars that support the overall goals of ending extreme poverty and boosting shared prosperity:
1) Financial Sustainability: The Bank works with governments to strengthen fiscal regimes, remove subsidies, and improve tax administration and revenue transparency to build resilience to economic shocks and reduce the opportunities for the resource curse. It also helps implement structured financial solutions to de-risk private sector investments, strengthen enterprises, and reinforce public-private partnerships.
The Bank also works with governments to develop policies for oil, gas, and mining regimes and capacity building for effective management. It starts with supporting capacity building for contract negotiation, and includes developing effective legal and regulatory frameworks, tax and royalty administration and revenue management.
To ensure effective and transparent revenue management in the extractives sector, the Bank supports the implementation of the Extractive Industries Transparency Initiative (EITI) through technical assistance to countries working to publish and verify company payments and government revenues from oil, gas, and minerals. A total of 51 countries are implementing the EITI standard, of which 49 are eligible for World Bank support.
By helping governments create an enabling environment, improve sector governance and lower risk, extractive industries can leverage large scale private sector investment through the IFC, a World Bank Group organization focused exclusively on the private sector in developing countries.
2) Social Sustainability: For effective development outcomes, local communities must actively participate in extractive industries operations from the very beginning, leveraging the industry’s infrastructure, job creation, and small business opportunities to provide long term sustainable development. To that end, the Bank promotes inclusive growth, bringing together diverse stakeholders to ensure accountability and lessen adverse impacts on communities and the most vulnerable people, particularly in fragile areas.
3) Environmental Sustainability: The World Bank works closely with governments to develop strategic environmental and social assessments to anticipate sector-wide impacts and to incorporate environmental and social priorities into extractive industries’ policies and regulatory arrangements.
Along with our core lending, analytical work, and knowledge products, the Bank administers Multi-Donor Trust Funds (MDTF) to achieve ambitious development goals:
The Extractives Global Programmatic Support (EGPS) MDTF supports programs ranging from transparency and governance, to legal and regulatory reform, local economic diversification, strengthening institutions, and social and environmental sustainability.
The Global Gas Flaring Reduction Partnership (GGFR) is a public-private initiative comprising governments, oil companies, and international institutions working to end routine gas flaring at oil production sites around the world as a way to increase energy access, improve efficiency, and mitigate climate change. GGFR focuses on harnessing associated natural gas to conserve it or put it to productive use rather than wastefully flaring it, which causes millions of tons of CO2 to be emitted.
Last Updated: Sep 29,2017