Canada’s Prime Minister, Stephen Harper, took a significant step toward promoting transparency and reducing global poverty. He announced yesterday that Canada will implement mandatory reporting requirements for Canadian extractive companies operating both in-country and abroad.
This mandate will require Canadian extractive companies to publicly disclose the payments they make to foreign governments in exchange for permission to operate on their soil. This development will help promote transparency in the mining sector and, if implemented effectively, could help combat the “resource curse.”
Fighting the Resource Curse through Access to Information
Tackling the “resource curse” is a challenge of global proportions. The term applies to situations where, despite a country’s mineral or oil wealth, poverty is exacerbated in part by weak or corrupt institutions, government mismanagement of revenues, and a failure to re-invest into projects that benefit the public—such as infrastructure, education, and healthcare. Often, citizens of resource curse countries aren’t able to hold their governments accountable for this abuse of power because they lack information about their country’s revenues and expenditures (see Box).