• Natural Resources for Sustainable Development in Eurasia.

EITI for Azerbaijan meant more than just EITI

March 27, 2017 Blog

Ingilab Ahmadov

Azerbaijani government decided to leave EITI last week, and set the first precedent in history of the initiative.

This came after the EITI Board's decision that Azerbaijan had not fully met corrective actions. Ironically enough, Azerbaijan has been one of the first countries that joined the organisation and even received an excellence award for implementation.

So what happened suddenly? Was that even sudden?

First, opposed to a common belief, I don’t think that there is a conspiracy against Azerbaijan in the initiative. The very basic reason of suspension is that the government did not comply with the requirements of the Standard. However, if we delve deeper there is more of explanation:

1. The initiative that was “toothless” and attractive in the beginning, started biting at a certain point. Thereafter, the government started seeing a threat in this organisation. In the beginning country’s compliance with EITI was assessed based upon set of Rules. This didn’t touch upon particularly “fragile” aspects of extractive sector. In 2013 EITI published its Standard for the first time with more rigorous demands and this scrutinised compliance status of many countries.

2.Civil society is an inseparable part of the initiative and it couldn’t withstand challenging test of finding its place in EITI. Supposedly, overload of the initiative with unsolved problems in the society, deteriorated the agenda of EITI in the country.

3. International community was incapable in drawing a clear line between human rights movement and advocacy of transparency in a particular sector. In this classic argument a winner is usually the one with stronger case examples. On the other hand, protocol of civil society participation is inseparable part of the 2016 Standard. It's most likely that EITI will face similar kind of contradictions again, given that out of 51 member states only a few have a well-grounded civil society and institutional basis for ensuring its efficient operation.

4. So called post-Soviet syndrome is a new challenge for EITI and Azerbaijan might be not the only country that will leave the initiative. Breakaway of Russia from democracy had a huge impact on other EITI members from post-soviet space. Lack of trust in civil society and government relationship with CSOs are the cornerstone of of this obstacle. You can read more on this in our blog: “Transparency is not fashionable in Eurasia yet”.

EITI membership is like a human brain, you don’t notice it by default. However, absence of it you can feel immediately. This initiative obviously was not the only decisive factor for our future. However, it was an essential denominator, along with BTC pipeline and international oil companies, for placing Azerbaijan in the global arena as one of key energy players. Thus, EITI’s benefits should be assessed within a comprehensive picture.

What is next?

The decision to leave the initiative was a well-thought one and it’s not just a sporadic and emotional reaction to the suspension. And this means that Azerbaijan is leaving EITI for a long time, unless any sudden and essential changes happen.

Will this have an impact on future development of oil and gas sector?

Certainly, yes. The latest EITI reports were very informative and useful. This kind of systematic information is absent in any other sector, which is also useful for filling a data base gap in Azerbaijan. Moreover, the government will halt the programme on launching an e-portal for providing open access to information on extractive industries.

Moreover, an already bleak attractiveness of the country to foreign investment will be damaged even more, given the link between reputation and foreign investments. Transparency is the key condition for a good reputation of a country. And the government is still interested in transparency, given that it's hard to be sure about legitimacy of any decision without transparency.

What will happen to civil society organisations?

NGO Coalition included more than 150 organisations and individuals, with more people willing to join. However, most of them didn’t really care about the fate of EITI. I believe that, most of the people joined the initiative as there is not really much option of any other activities in the country.

Most of these members didn’t acquire knowledge about the EITI. For me, from the very beginning the question was how to combine adequate qualification in this initiative with necessity of ensuring more participants from civil society. Most of the times these two conditions were colliding and that led to the exclusion of Azerbaijan from the initiative.

But not everything is lost. Azerbaijani government said that they would continue to produce public reports. In this case a new way of interaction between different groups should be found. And who knows maybe this is for better. One thing is clear that activities towards achieving transparency shouldn’t be ceased.

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