The Papua New Guinea (PNG) economy is dependent on natural resources, particularly its mining and petroleum sectors – primary sources of government income since the Pacific island nation became independent of Australia in 1975. In order to derive maximum benefit from these important sectors, their governance must be underpinned by the two key pillars of transparency and accountability. This would help to address the major issue of corruption which can obstruct the economic progress of any nation.
To help achieve this, the PNG Government signed up to implement the EITI Global Reporting Standard in 2014. The implementation of the EITI Global Standard involves member states publishing yearly reports about their mining and petroleum value chain highlighting those sectors.
Since 2014, the country has made significant progress in publishing reports that are aligned with the EITI Reporting Standard that is being implemented by more than 50 countries to establish good governance in the mining and petroleum sectors to help to stimulate economic growth and development.
As PNG makes progress in implementing the EITI Global Reporting Standard, development partners have joined with the government in this endeavour.
According to the PNGEITI National Secretariat, the World Bank, which is the agency that leads the coordination of EITI implementation, has been very supportive from the outset.
“The World Bank has been very supportive of EITI implementation in PNG from the start (initial discussions), especially in training and technical support during the initial setup of EITI in PNG. Over the years, there have been discussions between WB and PNGEITI regarding WB support for certain EITI projects, especially its funding support for outreach and awareness activities. The Bank agreed two years ago to provide some funding to support EITI implementation in PNG. However, nothing has happened so far due to the Bank’s strict internal procurement policies in releasing the funds,” PNGEITI Head of National Secretariat Mr. Lucas Alkan has said.
At the moment, through its bank-executed programs, WB is currently supporting the PNGEITI on a project of mainstreaming EITI reporting through an online (digital) platform. A consultant (Deloitte) has been engaged to undertake a scoping study for this project and it is anticipated that this will be completed by the end of this month or in early June, Mr. Alkan explains.
The second donor agency to come on board to offer support is the Japan International Cooperation Agency, JICA.
JICA, through the ‘Project for Improving Resource Related Revenue Management in PNG’, has been very supportive of EITI implementation in PNG. The project consultancy team has been very supportive of the PNG National Secretariat, especially in taking steps towards addressing some of the areas (corrective actions) of the first validation as well as providing technical support and assistance, not only for PNGEITI staff but also for key stakeholders such as the Department of Petroleum (DPE), Kumul Petroleum Holdings Limited (KPHL) and Mineral Resources Development Company (MRDC), Mr. Alkan added.
He explains that one of the key achievements of JICA’s involvement was the increased engagement and participation of the Department of Petroleum and Energy in the FY2018 reporting process which was not the case in the preparation of previous reports.
He said the JICA partnership has resulted in the re-establishment of DPE website and its setting up of a database.
JICA experts have been working with DPE officials to set up an oil and gas production database (production volumes and values) and licence information and its application process and procedures. The work has been disrupted by the coronavirus pandemic shutdown and hopefully will resume once things have returned to normal, Mr Alkan said.
Mr. Alkan said the Australian Government, the International Monetary Fund, and the Asian Development Bank have assisted in various areas of EITI programs and that, although development aid work is progressing, the COVID 19 pandemic is prominently featuring as a major challenge.
