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World Bank Supports Transparency through More Accountability in Albania’s Mineral Resources Sector

May 8, 2013

TIRANA, May 8, 2013 – Today, the International Board of the global Extractive Industries Transparency Initiative (EITI) has officially declared Albania to be EITI compliant. This means that the country has corresponded to all standards that are demanded by this initiative, which has originally been set up by the Blair Government in 2002 to allow for the mutual publication of revenues and payments that stem out of the oil and mining sectors.

Historically, in many countries, very little information has been available for ordinary citizens, who in turn have almost no influence on sector relevant decisions, despite the fact that mining and oil should benefit all. The result often has been waste and corruption, paired with social and environmental problems, leaving many citizens in countries with badly governed mineral sectors worse off than before. While ‘being EITI compliant’ may look like a technical term honoring the implementation of a technical initiative, it is much more than that. It is true that certain technicalities have to be fulfilled, such as setting up a Multi-Stakeholder Group (MSG), in which the Government, producing companies and civil society are represented. Also, considerable data has to be collected from both the companies and the various Government departments that are involved in the sector (such as the Ministry of Economy, Trade and Energy, the Ministry of Finance, the General Directorate of Taxation, Customs, the Albanian Natural Resources Agency etc). Then, this data has to be reconciled to see if the Government says it has received the same amount of taxes, royalties and other fees as the companies declare to have paid. If there are differences, the question is why, and what happened to the money?

But besides these important insights, the implementation of EITI also supports in a more general way the development of an open society. While most technical issues in mining and oil are rarely discussed in public, and revenues are being managed in a hidden way, EITI helps to bring light to these processes, and supports CSO organizations, in Tirana as well as in the regions, to actively become engaged in this process. Thus, with an appropriate amount of capacity building, they actually do have a say in the way mineral resources are managed in a country, and can influence decisions surrounding the industry.

The World Bank actively supported this process over the last 2.5 years, mainly through the EITI Multi-Donor Trust Fund (EITI MDTF) and accompanying parallel work on the small-scale mining sector and transfer pricing. The EITI MDTF supported the set-up and operations of the National EITI Secretariat, which coordinated the decisions of the Working Group (MSG), provided technical training to Government officials and CSO members, implemented a communications strategy for the initiative, and funded the two independently reconciled EITI reports. For the case of Albania, these reports found no substantial discrepancies between company payments and government revenues, which is encouraging. Less good news is the fact that the industry in general is underperforming, resulting in too little revenues being generated for the state and thus the public

Currently, the World Bank and the Government of Albania are about to set up a third EITI MDTF. Through it, the Bank and the Government seek to (a) improve and extend the outreach and communication capacity of the initiative, including tailored information and communication aimed at the oil and mining producer regions, and there to local Governments, CSO groups, journalists and parliamentary representatives; (b) continue with the provision of technical training and capacity building to enhance the knowledge of the above-mentioned target groups to understand critical sector issues and (c) increase the strategic relevance of the initiative by linking the fiscal revenues as outlined in the EITI reports with the likely potential of the sector under good practice governance levels through a sector wide study. In addition, the grant would also continue to fund the operations of the Secretariat as well as one EITI report.

Media Contacts
In Washington
Gary Mc Mahon
Tel : +1 202 458 1477
In Tirana
Ana Gjokutaj
Tel : +355 422 80 655