Jakarta, March 2, 2010 - The Extractive Industries Transparency Initiative (EITI) has admitted Indonesia as an EITI Candidate. EITI is an internationally developed standard that promotes oil, gas and mining revenue transparency at the national level. The Initiative is supported by the World Bank.
In February, a press conference was held in Jakarta to announce Indonesia’s candidacy into EITI with speakers such as Anwar B. Ravat, World Bank program manager for EITI as well as Ridaya Laodengkowe, coordinator of “Publish What You Pay – Indonesia,” a coalition of 38 Indonesian civil society organizations from 13 resource-rich provinces which support Indonesia’s adoption of EITI. At the press conference, the Publish What You Pay coalition expressed its optimism that the government and the country’s extractive industries would comply with the EITI’s requirement for transparency in revenue reports in the sector. The PWYP Coalition also highlighted the need for the government to build Indonesia’s image as a transparent country open to investment.
Under this global transparency initiative, which was started in 2002, all large oil, natural gas and mining companies operating in participating countries report the amount of tax and non-tax revenue they convey to governments and governments report the amounts of those revenues that they receive from companies. An independent administrator is appointed to cross-check data from the two parties. The results of this reconciliation are published and communicated widely. The entire process is overseen by a multi-stakeholder working group, which includes civil society and industry representatives.
This initiative is expected to bring a number of benefits for Indonesia. Short term benefits may include availability of public information that previously did not exist, bringing better trust between CSOs, government and the extractive industries. Longer benefits may include increased revenue and investment in oil and gas which will lead to better energy security for the country.
Indonesia’s President signed into force Presidential Regulation 26/2010 in April, 2010 which lays out a detailed road map for Indonesia’s implementation of the EITI.