Normally, the courageous democratic movement in the West African dictatorship of Equatorial Guinea does not pay attention to the activities of the US Securities and Exchange Commission. But a recent landmark SEC decision will have prompted discreet but enthusiastic celebrations in the opposition’s headquarters, a simple white frame building in the ramshackle Equatoguinean capital.
On August 22, the SEC issued regulations that will force oil, gas and mining companies that are listed on US stock exchanges to publish what they pay to foreign governments. The new regulations will finally enforce an anti-corruption section of the 2010 Dodd-Frank financial reform law, known as the Cardin-Lugar amendment, which requires some 1,100 resource companies to break down their payments and report them in revealing detail. In the more than two years since the law passed, Big Oil lobbyists tried ferociously—and failed—to water down the new transparency regulations.
The SEC decision is the biggest single victory in many years for poor people across the Third World. No longer will the big oil and mining companies be able to hide their under-the-table payments to crooked governments in Africa, Latin America and Asia. Over the past twenty years, new independent civic organizations have sprung up all over the poorer parts of the planet, alongside vigorous community radio stations, opposition publications and websites. In the years and decades to come, ordinary people will be intrigued to learn exactly how much the oil giants like Exxon and Shell and big mining companies such as Freeport-McMoRan and BHP Billiton are paying their governments. They can then contrast the billions of dollars in royalties and taxes with the potholed dirt roads, decrepit hospitals and overcrowded schools that they see around them.
The successful fight for openness took ten long years. The Publish What You Pay coalition grew to include more than 600 individual groups, with national affiliated campaigns in thirty-one different countries. In the United States, key organizations also included the Revenue Watch Institute, Oxfam America and Global Witness. The tremendous victory is boosting a similar measure in Europe; proponents hope to bring a similar transparency measure to a vote in the European Parliament before the end of this year.
Excitement over the SEC decision will not be confined to Malabo, the steamy capital of Equatorial Guinea. In Angola, where the oil giants have transferred vast wealth to the one-time Marxist elite but left the vast majority of the people in poverty, a growing opposition will also celebrate. In the Democratic Republic of the Congo, members of the outspoken Journalists’ Association whom I met recently in Fungurume, near the $2 billion Freeport-McMoRan copper mine, will have more specific information for their reports. Cambodians for Resource Revenue Transparency will be able to keep closer watch on Chevron, Total and ConocoPhillips. In East Africa, the distinguished journalist Charles Onyango-Obbo is probably licking his chops at another chance to scrutinize his old nemesis, the Museveni regime in Uganda, where sizable oil reserves have recently been discovered.
Publish What You Pay is vital because for the foreseeable future, the only way a large number of Third World nations will be able to grow is by exporting oil and minerals. The rise of Sweatshop China has meant that diversification into manufacturing is only a dream for most countries in Africa, and for many others elsewhere. Many of the poor nations have to rely on agricultural exports like cocoa, cotton and sugar, but their prices tend to stay low over time, and hypocritical protectionist policies in the rich world also limit how much they can earn.