Monday, October 23, 2017

Trump’s shadow over anti-corruption rules


On February 14, it was announced US President Donald Trump, within the first month of his presidency and through his first piece of legislation, had repealed the US Security Exchange Commission rule that required oil, gas and mining companies to disclose their payments to foreign governments.

The news sent ripples through countries that are rich in natural resources that are extracted by foreign companies and rely on the revenues thus generated to sustain their economies and provide services to their citizens.

Trinidad and Tobago is one such country and questions are being asked about the impact of this development on the energy sector and the implementation of the Extractive Industries Transparency Initiative (EITI) through which revenue payments to the Government are shared with the public in annual EITI Reports (www.tteiti.org.tt/eiti-reports).

The impact on T&T of President Trump's action will be negative, if only because it strikes a blow against the Government's policy to bring increasing transparency and accountability to the local extractive sectors (oil, gas and quarrying) by its membership of the EITI since March 2011.

However, the blow is not fatal because the US Dodd-Frank Act that gave rise to the SEC disclosure rule that now has been repealed also gave birth to similar legislation and rules in the European Union's 28 countries, Norway and Canada which remain in force.

Therefore, most of the foreign companies that operate in T&T's energy sector are currently subject to and complying with those disclosure requirements in other jurisdictions.

As voluntary participants in EITI reporting elsewhere and in T&T, we can expect no lessening in those companies' commitment to transparency and accountability and their support to the EITI reporting process.

In viewing this development, citizens must recognise such an early removal of a key anti-corruption measure of the Obama administration may reinforce the perception being voiced in America's media that Donald Trump may be soft on corruption as is further evidenced by many allegations of conflicts of interest facing his administration.

We should observe these developments with caution.