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Afghan government making effort to bring transparency in mining industries

in Afghan Business

Afghan government making effort to bring transparency in mining industries

Afghanistan Extractive Industries Transparency Initiative (AEITI) released its first report on the reconciliation of payments by mining industries to government and revenues received by government.

The report was based on the payments by major mining companies in Afghanistan including AIC, MCC, Beradaran Khoshak, Misaq Sharq, Wens Logistics and Northern Coal Enterprise during the fiscal years of 1387 and 1388.

The ceremony of releasing the report was held on Wednesday in Kabul in the presence of Minister of Mines, Minister of Economy, Minister of Finance and other foreign and local officials.

Speaking at the ceremony, Minister of Finance Omar Zakhilwal called the provision of information on extractive industries to the public is a big move towards transparency in mining.

“We will continue to disclose our revenues from our extractive industries for as long as we witness improvement in this sector,” said Minister Zakhilwal.

Minister Zakhilwal further added that disclosing taxes obtained from mining industries is a continuous process.

The AEITI Secretariat, based in Kabul, in close coordination with the Multi-Stakeholder Group (consisting of the Government, the Private Sector, and the Civil Society) is in charge of implementing this process of reconciliation.

According to Minister Zakhilwal, the report for the fiscal year 1391 will soon be published.

The report pinpoints any discrepancy that exists between the payments from companies and the receipts of taxes by the government. The government will then take measures to eliminate those discrepancies.

As part of approach towards achieving transparency, any contract that has been signed with a mining company is published on Ministry of Mines’ website. And, in the future the contracts will be made available to general public as well.

Minister Zakhilwal hoped that by 2013 AEITI would be recognized as EITI Compliant.

The Extractive Industries Transparency Initiative (EITI) is a global standard for promoting greater accountability in developing countries which are rich in oil, gas, or mineral resources.

Afghanistan is currently an EITI Candidate after successfully fulfilling the initial requirements. To achieve EITI Compliant status, a country must complete an EITI Validation. It provides an independent assessment of the progress achieved and what measures are needed to strengthen the EITI process. There are 20 requirements of EITI that a Candidate must meet.

Afghanistan is one of the 23 EITI candidate countries. On March 16, 2009 the government of Afghanistan announced its endorsement of the principles of EITI. Afghanistan endorsed EITI to help promote the efficient and effective management of revenues received from extractive resources in Afghanistan, in line with international standards.

Minister of Mines Waheedullah Shahrani said that transparency should exist in the management of the mines, in the bidding process, during contract negotiations and on the usage of these revenues by the government.

He called for reforms in the mining law in order to bring transparency and attract international investment.

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