Tag Archives: Subnational Reporting

The Trip to Ulaanbaatar: An Unforgettable Journey

Justin Kwan, MAAPPS // May 13, 2015

After 19,308km of traveling from Canada to Mongolia, the Asia Pacific Policy Project team has finally returned back to the University of British Columbia. The journey to Ulaanbaatar has been an amazing experience, to say the very least. Nine days in Mongolia’s capital city has created a fresh viewpoint not only on the way I view policy making, but the real struggles that occur between different interest groups in the negotiation process.

The beginning of the trip started with the participation in the Freedom Online Coalition (FOC) Conference, with a keynote opening speech by Tsakhiagiin Elbegdorj, the President of Mongolia. While freedom online and the EITI subnational reporting project may appear to be completely unrelated, President Elbedgdorj acknowledged that beyond mining, he wanted his country to expand its investments and businesses into the IT and software industry. Perhaps a subtle, but clear sign that that Mongolia is looking to diversify its investments, and perhaps has too heavily relied on the extractive industry to support its economy.

A reoccurring theme throughout the trip however has been the frequent discussion of the mismatch between our “words and deeds.” A FOC panel discussing future internet trends noted the question of double speak and the distance between practice and implementation in policy making. After team discussions and reflections upon our trip, we agreed that the coined term could most appropriately be used in our meetings with government and civil society organizations.

Throughout the trip, three perspectives about the future of subnational reporting emerged from out meetings. On one hand, I can see great optimism about Mongolia’s future and EITI subnational reporting. In our meeting with Mongolia’s EITI secretariat office, it was indicated that already, 19 out of 21 Aimags are reporting at the subnational level through electronic online surveys. This is something that we were pleasantly surprised to learn about and that future training workshops will be providing this upcoming year to help facilitate the transition.

On the other hand however, there is another perspective from other civil society groups that the EITI project has failed to reach out and properly inform citizens about transparency in the mining sector. According to them, there is no desire to make this information accessible to ordinary citizens, and the project has wasted millions of dollars. With the fact that EITI Mongolia is still in the process of securing donor funds for the next year, it would appear that the initiative may be in limbo for the upcoming months.

A third and final perspective from EITI civil society stakeholders reveals the passion and desire to create a robust civil society that will protect the country’s interests. There is a legitimate desire amongst these groups to encourage the population to become more involved, and there is a legitimate sense of frustration and debate as to how these ideas can be fully implemented. While many ideas were exchanged, it was surprising to note that a rather important voice remained silent throughout these discussions, perhaps one of the most important voices for inciting real change in Mongolia.

From this trip, we have realized that although our desires to encourage EITI policy recommendations have somewhat fallen on deaf ears, there is still hope. Indeed, there is a complete disconnect between policy theory and policy implementation, and the actors who can make the most difference prefer to keep the status quo. However, trips like this showed us some of the most real-time up-to-date information about subnational reporting that no literature was able to provide. The Ministry of Mining of Mongolia also revealed that the extractive industries transparency legislation has been drafted and is seeking approval from parliament. Although frequent election cycles have created a lack of continuity in policy making in Mongolia and perhaps a somewhat unstable political environment, I still look at this situation with a great sense of optimism because the hopes and aspirations of the people in Mongolia are strong. While I myself may be aspirational in my outlook, I look at the desire for change as one of the greatest motivators for continuing to strive for success.

Reading about Mongolia is one experience, living it and experiencing it first hand is completely different – something I truly believe everyone should try at least once in their lifetime.

The EITI Journey in Indonesia – Part 2: Challenges to Subnational Reporting

Justin Kwan, MAAPPS // Feb 23, 2015

Despite the fact Indonesia only recently achieved EITI compliant status in October 2014, the country has actually implemented since 2010, laws which regulate the transparency of national and local extractive industry revenues.Subnational reporting in the case of Indonesia has been met with positive responses but has experienced difficulty in its practical implementation. ThePresidential Regulation Republic of Indonesia, Number 26, Year 2010guarantees the need for establishing the Transparency of National/Local Extractive Industry Revenues. For instance, it regulates the the creation of an Implementation Team (Tim Pelaksana), which is comprised of three seats for subnational government officials on the EITI Indonesia multi-stakeholder working group as well as three regional secretaries. The produced framework here shows strong a commitment to EITI transparency principles and the appropriate context for subnational reporting to operate.

Despite this, the practical implementation of subnational reporting has been met with unexpected results. One of the largest issues that has surfaced is the topic of district-licenced mining permits. Indonesia’s 2000 decentralization law allows for local districts to issue licence permits. Regional autonomy was seen as the next logical reform in Indonesia, which came about during the increasing democratic reforms that were being put into place after the end of the Suharto regime. While the Ministry of Energy and Minerals was aware that 10,500 district licences were issued in 2011, the government only had adequate levels of information for only 4000 of them. Given Indonesia’s population size and the geographical area of the archipelago, the decision to decentralize is logical, as more individualized attention could be given by local governments. The unintended consequence is that tracking at the national level is extremely difficult.

In conversation with Indonesian civil society organizations, I received responses from different groups which were located across the country. What appears to be evident is the increasingly strong push for civil society engagement in Jakarta, in which detailed plans for subnational reporting and beta testing are already occurring. Meanwhile, in the province of Riau, discussions of subnational reporting had been made at the local level, but were not being discussed at the national level, according to my correspondence with their civil society groups. With EITI compliance stronger in some areas more than others, there must become a way to identify which regions are priorities for subnational reporting. Then, EITI can have a strong impact on improving the transparency of the extractive industry.

So what are the next steps for Indonesia? The EITI Implementation Team Meeting on September 9, 2014 agreed upon the upcoming working plan for the 2014-2015 year. In regards to subnational reporting, the team is looking at three important areas: (1) regularly publishing the Revenue Sharing Fund (DBH) per District Per Company/Unit Production (2) involving Regional Governments in the extractive industries transparency process and (3) having Regional governments push companies to open up their tax data. The two largest obstacles cited in this implementation plan include the fact there are limited human resources needed to handle the revenue calculations as well as a lack of understanding by regional governments of the importance of EITI.

Clearly, Indonesian stakeholders and EITI must work together to identify the most lucrative extractive resource industry areas of the country and create a targeted plan to ensure that subnational reporting is operating in these target areas. While the “One Map Policy” appears to be one response to the problem, the government must also find a way to engage with local governments in a meaningful way to further the transparency process. In a large country like Indonesia, a targeted and refined plan is needed in priority areas before focusing on widespread implementation across the country.


Subnational Reporting – Lessons from the Philippines

Christina Toepell, MAAPPS // Feb 11, 2015

When thinking of glorious mining countries in the world, the Philippines is most likely not amongst the first countries that come to mind. The archipelago, located in the Western Pacific and consisting of more than 7,000 small islands, is more known for its political instability in the 20th century, the comparatively good education system and the large Philippine diaspora living around the globe. Our perceptions on mining are not wrong – to date, only 1.28% of the country’s GDP is generated from the extractive sector, and only 0.58% comes from metallic mining.

Why are we even observing this country and its mining activities? According to numbers from the Mines and Geosciences Bureau of the Philippines (MGB), about 30% of its land is geologically promising, with the total estimated value of the country’s mineral reserves adding up to USD 1,387.1 billion. Thus, the work of EITI will become increasingly important in the future.

First engaging with the country in 2013, EITI is still in the initial stage, engaging with mining on a national sector. With its maiden report published in December 2014, it is expecting to gain full EITI membership in the upcoming years. Not surprisingly when looking at the strong level of civil society organizations, it has been warmly welcomed to the country and has been cooperating with national organizations such as Bantay Kita from the beginning.

Bantay Kita, which can be translated to English as “We Guard”, is a national NGO working on increasing transparency and accountability in the extractive industries. Established in 2009, it has had sufficient time to build a strong network across the country and start two subnational activities in the Southern island of Mindanao, the least developed of the three big islands. While the initiative in T’Boli, South Cotabato mainly focuses on empowerment of civil society and artisanal mining, the Compostela Valley transparency initiative was the first subnational organization in the country.

With most of the mineral land falling under special protection due to its Ancestral Domain status, Compostela Valley is one of the regions were subnational reporting is most urgently needed. Bantay Kita’s subnational multi-stakeholder group gained full legitimacy in 2012 and has been working on issuing a subnational report on mining activities ever since. In 2013, it issued a 72-pages handbook with background on the area and the initiative. The main part contains detailed reporting templates for all relevant entities, assisting these institutions in disclosing their revenues, payments and contracts according to the initiative’s standards. While still waiting for the final disclosures of some entities, the Compostela Valley transparency initiative expects to be able to publish the first subnational report in the Philippines later this year.

Starting to focus on our mandate for Mongolia, I am wondering how we could translate the excellent initiative in Compostela Valley to our work in Northern Mongolia. How can we adequately adapt a Philippine project that has put more than 3 years of effort into their subnational report? How can it fit the context of a small UBC graduate student project focusing on the Mongolian mountains with less than 3 months to go? I am more than excited to finally start with our work in Mandal Soum, but simultaneously understand that my expectations will probably need to bow to smaller projects with more realistic outcomes and higher feasibility.

Extracting Transparency in Mongolia and Beyond

Justin Kwan, MAAPPS // Jan 26, 2015

Asia’s rise in the 21st century has been commonly characterized by the dominance of the region’s major powers such as China, Japan, South Korea and India. Far too often overlooked however is the important presence of Mongolia. Situated between both Russia to the north and China to the south, Mongolia has been overshadowed by two of its neighbouring superpowers. While Mongolia may go unnoticed to many countries across the world, China recognizes Mongolia’s strategic importance for its natural resources, primarily copper, coal, gold and uranium.

As an aspiring China scholar, the Middle Kingdom’s interest in Mongolian natural resources also sparked my curiosity for the country, its growing importance to the Asia Pacific Region and my participation here in this year’s policy project.  Roland Nash of Renaissance Capital described Mongolia as “a blue-sky opportunity” and as “a country on the point of transformation” (Business New Europe, 2009). His assertion six years ago has been extremely forth telling of the economic development that has been occurring.

This year’s policy project continues with the work produced by last year’s cohort who examined the policy mechanisms for discouraging corruption and improving human development in Mongolia. As part of our investigation, our research this year will look at EITI’s important move to push transparency reporting down from the national to the local level. My initial thoughts immediately gravitate towards a series of questions: Who within EITI is encouraging the reporting to be pushed down to the local level? What are the motivations behind this? In what ways will this benefit and/or complicate the way reporting is completed?

To answer these questions, one important aspect that must be investigated is how actors both at the domestic and national levels impact the policy making process. EITI is a coalition of governments, companies and civil society groups – all who play important roles in shaping the organization. As our research continues, I am particularly interested in investigating how these actors engage with each other to formulate policy as well as the regional variations between how EITI member countries implement them.

I hope from this experience to future my knowledge not only in the field of policy work and transparency initiatives but also to expand my knowledge of the Asia Pacific Region. My current research looks at EITI Compliant Country Indonesia in order to create a comparative framework which will allow us to assess how different member countries are adapting to local level reporting. While much work lies ahead of us, I am most definitely excited for the journey to come.