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EITI: Afghanistan achieves transparency despite barriers

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(Last Updated On: October 30, 2020)

Following its second Validation, Afghanistan has made meaningful progress in implementing the Extractive Industries Transparency Initiative (EITI) Standard.

Afghanistan has been a member of the Extractive Industries Transparency Initiative since 2010, but its membership in the organization was suspended due to its inadequate implementation in 2014 and 2017.

The Extractive Industries Transparency Initiative (EITI) in a statement on Thursday said that Afghanistan has improved its transparency of licenses and contracts, state-owned enterprises and quasi-fiscal expenditures. As a result, Afghanistan’s temporary suspension has been lifted.

EITI board congratulates Afghanistan for addressing shortcoming identified in its first validation through systematic disclosures of data delivered by concrete reforms in government systems. 

Afghanistan’s President Ashraf Ghani noted the important role the EITI plays in the country. “Every citizen has the right to know who is developing the country’s natural resources and how the government is managing the revenues from these industries on their behalf,” he said. “The EITI is one of the tools that is helping us achieve this policy objective. It has been instrumental in supporting our institution-building efforts in a sector critical to the economic future of Afghanistan.”

The Ministry of Mines and Petroleum announced Thursday that Afghanistan has rejoined the Extractive Industries Transparency Initiative (EITI).

Building transparent institutions and systems

Afghanistan’s government has embraced open data platforms, establishing online reporting systems to enhance transparency of extractive sector management and to address shortcomings identified in its first Validation. This has been achieved in an evolving political environment marked by presidential elections in 2019 and intra-Afghan peace negotiations in 2020. The World Bank underscored the EITI’s value in driving public finance management reforms in a context of fragility and violence.

In 2018, the Ministry of Mines and Petroleum (MOMP) launched a new Transparency Portal, providing information on licenses, fiscal terms, legal and beneficial ownership information, production data and non-tax company payments to government. Since then, the portal has become even more comprehensive.

Taking action to improve accountability

State-owned enterprises (SOEs) are important players in Afghanistan’s extractive sector, accounting for nearly two thirds of government extractive revenues between 2008 and 2017. Two SOEs – Afghan Gas Enterprise and North Coal Enterprise – are strategic for the government’s plans to improve revenue generation from the sector.

In 2019, Afghanistan undertook the landmark achievement of auditing the two SOEs for the first time. This exercise highlighted gaps in the SOEs’ record-keeping and financial management, and was a necessary step in the government’s plans to corporatise the enterprises. Moving forward, the government will need to ensure auditing becomes regular practice, drawing on EITI support to follow-up on findings.

Afghanistan’s government has legislated for beneficial ownership information to be made public for mining, oil and gas licenses. The country began publishing ownership data on its Transparency Portal earlier this year. Yet more work needs to be done to ensure that all beneficial owners are publicly disclosed, including politically-exposed persons and owners who control companies through non-equity means.

Strengthening multi-stakeholder oversight

EITI Board Chair Helen Clark commented on the significance of Afghanistan’s recent progress. “Afghanistan has made concrete achievements in improving transparency despite challenging circumstances,” she said. “The priority should be to draw on this emerging transparency for policy-making in the sector. This is key to broader economic development efforts and ensuring that all citizens have an opportunity to engage in debate on the governance of the sector.”

Data from EITI reporting – spanning several legislative changes and wide commodity price fluctuations over the past decade – provides a key resource to support further research and analysis. But despite proactive dissemination efforts, including in provincial capitals, there is a lack of data use by diverse stakeholders.

Yet an initiative by Integrity Watch Afghanistan stands out. The civil society organisation is expanding its community-based monitoring programme to include extractive activities, empowering host communities to track the impacts of extractive projects in their areas. Stronger engagement in EITI implementation by government, industry and civil society could lead to more such innovations.

Afghanistan’s informal mining sector is one area where there is a high demand for data. While the government collects USD 45m a year in mining revenue, it is estimated that more than six times that amount is being lost through unmonitored, small-scale mining activities. There is strong interest, particularly from civil society, to use EITI reporting to shed more light on unrecorded mining and support efforts to formalise the sector.

According to EITI Afghanistan will have 18 months (28 April 2022) to address the remaining five “Corrective actions” in its implementation of the EITI Standard.

The Afghan Ministry of Mines and Petroleum said that the ministry renewing its commitment to implement the corrective actions of the Extractive Industries Transparency Initiative.

The Extractive Industries Transparency Initiative is an international organization that ensures transparency in the country’s mines, gas and oil.

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Taliban under pressure from US for failing to stick to deal: Envoy

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(Last Updated On: November 30, 2020)

Ross Wilson, US Chargé d’Affaires to Afghanistan said Monday that the US will put pressure on the Taliban as the group has failed to act in accordance with the US-Taliban agreement and has not reduced violence in Afghanistan.

In an interview with Ariana News, Wilson said the increase in violence across the country is unacceptable and that the Taliban has not heeded calls by the United States or the international community for a reduction in violence.

He also accused the Taliban of being involved in targeted killings and said the group “is complicit in a culture of violence”.

“The Taliban are not meeting the commitments they made with us in concluding US-Taliban agreement in February. We have repeatedly called on the Taliban to reduce the violence.

“Unfortunately, our efforts, our advocacy, and advocacy by many of Afghanistan’s other friends. the efforts of the United Nations did not succeed. And we are putting pressure on the Taliban. This is important for the success of the peace process and for the success of this country,” said Wilson.

Questions around the withdrawal of US troops from Afghanistan and the foreign policy of the incoming US president, Joe Biden, on Afghanistan were also raised in the interview.

However, Wilson did not comment on the foreign policy but did say the withdrawal of troops from Afghanistan was conditions-based.

“US forces and coalition forces remain substantial. We are actively defending the Afghan Defense and Security Forces. The issue of withdrawal, which was previously announced by the United States, will be based on conditions,” Wilson added.

Wilson also said the United States is working with the Afghan government to recover money embezzled by corrupt individuals.

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Cross-border markets will be up-and-running in February

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(Last Updated On: November 30, 2020)

Pakistan said Monday that one of the 12 Joint Border Trade Markets, that is to be established along the Afghanistan-Pakistan border, will be launched by February 2021.

In a statement released on Monday, the Embassy of Pakistan in Kabul stated that the market would be operational at Shaheedano Dand in Kurram Agency of Pakistan.

“The Joint Border Trade Markets are believed to promote the wellbeing of the people living on both sides of the border, rehabilitate those affected by anti-smuggling drive, economically integrate the neglected areas, formalize bilateral trade and transform local economies of people living across Pak-Afghan border,” Pakistan Embassy in Kabul said in a statement on Monday.

According to the statement, Pakistan has prepared a draft Memorandum of Understanding (MoU) on the establishment of the markets with Afghanistan.

The statement noted that the MoU has covered “all the modalities including the proposed list of items to be traded in these markets and locations where the border markets are to be established, the composition of Border Market Management Committees, which will oversee the smooth working of the markets, the medium of exchange and dispute settlement.”

“Once, formally established, the people friendly initiative of JBTMs of Prime Minister of Pakistan is expected to uplift the economic and social wellbeing of the people living across Pak-Afghan border,” the statement read.

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NATO facing difficult dilemma on whether to leave or stay: Stoltenberg

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(Last Updated On: November 30, 2020)

NATO Secretary-General Jens Stoltenberg said Monday that “no one wants to stay in Afghanistan longer than necessary.”

Addressing an online press conference ahead of the NATO Ministers of Foreign Affairs meeting, Stoltenberg stated the organization’s training mission continues despite the US’ decision to further reduce troop levels in Afghanistan.

This comes after outgoing US President Donald Trump decided to further reduce American forces in Afghanistan from around 4,000 to 2,500, as part of the Doha deal which was signed between the US and the Taliban in February.

Stoltenberg, meanwhile, stated that the alliance forces would assess their presence in Afghanistan in the next few months.

“In the months ahead, we will continue to assess our presence based on conditions on the ground,” he noted.

“We face a difficult dilemma, whether to leave and risk that Afghanistan becomes once again a safe haven for international terrorists. Or stay, and risk a longer mission, with renewed violence,” he said.

According to the Doha deal, the US should pull all its troops out of Afghanistan by May.

But US Secretary of State Mike Pompeo told Fox News last week that the full withdrawal remains based on a set of conditions on the ground.

“That was what we’d agreed to. We have made some progress. We’ve had significant prisoner releases. We have violence levels that have reduced risks to Americans significantly over this time period since February of last year,” Pompeo stated.

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