Extractive Industry Governance Research Articles

The Politics of Extractive Industry Governance in Post-Apartheid South Africa: A Case Study of Platinum Group Metals

The Politics of Extractive Industry Governance in Post-Apartheid South Africa: A Case Study of Platinum Group Metals

Social‐ecological reflexivity of extractive industry governance? The case of the Extractive Industries Transparency Initiative in Indonesia

AbstractThe Extractive Industries Transparency Initiative (EITI) sets standards to improve the governance of extractive industries and thereby stimulate sustainable development. Member countries implement this standard through a multi‐stakeholder group (MSG) which facilitates deliberation between government, civil society and business representatives. This deliberation could enable what we call ‘social‐ecological reflexivity’: the ability to reconfigure oneself in response to critical reflection on one's performance in governing not only the economic, but also the social and environmental dimensions of sustainable development. Such reflexivity is crucial for countries to not only comply with the EITI standard, but also improve governance quality to address the social and environmental impacts from extractive industries. Drawing on a fully operationalised conceptual framework, we analyse social‐ecological reflexivity in the implementation of the EITI in Indonesia, a country that is heavily impacted by extractive industries. We draw on content analysis of the MSG meeting minutes and EITI‐Indonesia reports between 2012 and 2019. We show that the EITI‐Indonesia has not (yet) generated deep social‐ecological reflexivity. First, there is limited recognition and rethinking of extractive industry governance and no real response in the form of governance reforms. Second, there are even signs of what we call ‘anti‐reflexivity’, whereby members of the multi‐stakeholder group ignore and resist public debates around the negative impacts from extractive industries. In analysing the different components and degrees of reflexivity around the EITI‐Indonesia, the article provides vital insights into the (study of) conditions under which global norms such as the EITI find meaning in and affect specific contexts.

Improving governance quality through global standard setting? Experiences from the Extractive Industries Transparency Initiative in Indonesia

The Extractive Industries Transparency Initiative (EITI) is a global standard that aims to improve governance quality in the extractive industries sector, particularly through enhanced transparency, participation and accountability. This article analyses to what extent and how the EITI improves governance quality and thereby addresses the environmental and social impacts from extractive industries in Indonesia, a country with pronounced conflicts over natural resources. Drawing on semi-structured interviews and analyses of EITI meeting minutes and reports, we conclude that the implementation of the EITI in Indonesia helped to strengthen civil society participation and empowerment to engage in extractive industry governance, both within and beyond the EITI-Indonesia multi-stakeholder group. The EITI falls short, however, in enhancing transparency and accountability due to important limitations in the information disclosure and misalignment between the country's decentralised governance of extractive industries and the EITI's national implementation. This also means that environmental and social impacts have not become subject to serious debates within the multi-stakeholder group. We lay out some broader policy and research implications and argue that both policymakers and scholars should look beyond the narrow scope of the EITI requirements and consider the EITI's success in light of its ability to foster wider governance reforms.

When global norms meet local politics: Localising transparency in extractive industries governance

AbstractProcesses of norm localisation play a crucial role in shaping the extent to which global governance norms are institutionalised at national and sub‐national levels. This article explores the politics of norm localisation through an empirical investigation of how global norms of “transparency” were localised in sub‐national processes of extractive industry governance in Bojonegoro, Indonesia. Previous theories of localisation have emphasised “constructivist” dynamics through which patterns of norm localisation are shaped decisively by efforts to build normative or cognitive congruence with local ideas and identities. In contrast, the mix of a newly democratised environment, the persistent power of corporatist elite networks and a populist style of local politics prevailing in Bojonegoro have diminished the significance of such constructivist dynamics as a basis for explaining varied patterns of norm localisation. Instead, patterns of norm localisation have depended crucially on the capacity of local political leaders to harness global governance norms instrumentally as a basis for consolidating and strengthening their own local power base. These findings have important implications for both theoretical and practical understandings of how global norm localisation processes vary in response to the contrasting political contexts in which global governance norms targeting the extractive sector are implemented.

The impact of international law on natural resource governance in Greenland

Abstract The paper demonstrates how the evolution of international law on colonial and indigenous peoples, in particular evolving rights to sovereignty over natural resources, shaped the changing relationship between Greenland and the rest of the Danish Realm. Greenland today is in a unique position in international law, enjoying an extremely high degree of self-government. This paper explores the history, current status and future of Greenland through the lens of international law, to show how international obligations both colour its relationship with the Kingdom of Denmark and influence its approaches to resource development internally. It considers the invisibility of the Inuit population in the 1933 Eastern Greenland case that secured Danish sovereignty over the entire territory. It then turns to Denmark’s registration of Greenland as a non-self-governing territory (colony) in 1946 before Greenland’s-purported decolonisation in 1953 and the deficiencies of that process. In the second part of the 20th century, Denmark began to recognise the Greenland Inuit as an indigenous people before a gradual shift towards recognition of the Greenlanders as a people in international law, entitled to self-determination, including the right to permanent sovereignty over their natural resources. This peaked with the Self-Government Act of 2009. The paper will then go on to assess competing interpretations of the Self-Government Act of 2009 according to which the Greenland self-government is the relevant decision-making body for an increasing number of fields of competence including, since 1 January 2010, the governance of extractive industries. Some, including members of the Greenland self-government, argue that the Self-Government Act constitutes full implementation of the UN Declaration on the Rights of Indigenous Peoples (UNDRIP 2007), but this view is not universally shared. The paper also considers the status and rights of two Greenland minorities: the North Greenlanders (Inughuit) and the East Greenlanders, each of whom has distinct histories, experiences of colonisation, dialects (or languages) and cultural traditions. While the Kingdom of Denmark accepts the existence of only one indigenous people, namely, the Inuit of Greenland, this view is increasingly being challenged in international fora, including the UN human rights treaty bodies, as the two minorities are in some cases considered distinct indigenous peoples. Their current position in Greenland as well as in a future fully independent Greenland is examined, and the rights that they hold against the Greenland self-government as well as the Kingdom of Denmark explored. Greenland’s domestic regime for governance of non-renewable natural resources (principally mining and hydrocarbons) is briefly analysed and compared with international standards, with a particular emphasis on public participation. The paper assesses the extent to which it complies with the standards in key international instruments.

Globalizing Extraction and Indigenous Rights in the Russian Arctic: The Enduring Role of the State in Natural Resource Governance

The governance of extractive industries has become increasingly globalized. International conventions and multi-stakeholder institutions set out rules and standards on a range of issues, such as environmental protection, human rights, and Indigenous rights. Companies’ compliance with these global rules may minimize risks for investors and shareholders, while offering people at sites of extraction more leverage. Although the Russian state retains a significant stake in the oil and gas industries, Russian oil and gas companies have globalized as well, receiving foreign investment, participating in global supply chains, and signing on to global agreements. We investigate how this global engagement has affected Nenets Indigenous communities in Yamal, an oil- and gas-rich region in the Russian Arctic, by analyzing Indigenous protests and benefit-sharing arrangements. Contrary to expectations, we find that Nenets Indigenous communities have not been empowered by international governance measures, and also struggle to use domestic laws to resolve problems. In Russia, the state continues to play a significant role in determining outcomes for Indigenous communities, in part by working with Indigenous associations that are state allies. We conclude that governance generating networks in the region are under-developed.

Impact of Global Governance of Extractive Resources on Ethiopian Extractive Resource Policy and Legal Framework

Ethiopia has policies and laws meant to govern the extractive resources and industries. The policies and laws in place share a cohesion compared with the fragile global governance system dominated by bilateral and multilateral treaty arrangements and voluntary standards. A closer scrutiny of the existing legal and policy regime reveal the influence the global forces of the world have on their content as well as structure. Natural resources being of high importance to economic development and the associated political tension raised in benefit sharing, call for a governance regime that responds both to the domestic demands as well as international competition. The continued influence of global actors and globalization on the domestic policy and legal space specifically manifested by liberal thoughts of ‘transparency in resource governance’ can act as a barrier to the resource gain threshold or as a God send in battling resource curse. This paper argues that Ethiopian EIs policy and legal regime is influenced and will continue to be influenced by the global governance structure and there is a need for a contextual approach and further study on governance of extractive industries as a way to escape the fears of globalization while guaranteeing its benefits.

NGOs as innovators in extractive industry governance. Insights from the EITI process in Colombia and Peru

This paper explores NGO participation within the Extractive Industries Transparency Initiative (EITI), a multi-stakeholder governance arrangement focused on generating greater transparency in the governance of extractive industries, and in particular in fiscal arrangements around mining, oil and gas operations. Using the cases of Peru and Colombia, we examine what motivates NGO participation in EITI, how NGOs have pursued innovations within EITI, the extent to which they have succeeded in achieving their goals, and the factors limiting or shaping their achievements. We draw on interviews conducted between 2013 and 2018, participation in global EITI meetings, and secondary material. The paper examines political and conceptual discussions regarding the opportunities that EITI may or may not afford to NGO-led innovation, while linking these to more general debates on achieving progressive or even transformative change through reformist institutions, as well as the roles of NGOs in multi-stakeholder governance processes.

Vulnerabilities of Indonesia’s Extractive Industry to Illicit Financial Flows

This article aims to explain the vulnerabilities of Indonesia’s extractive industry governance to the illicit financial flows. Earlier studies figured out that the company in extractive industry has been found to be one of the prominent actors of illicit financial flows. In the case of Indonesia during the period of 2004-2013, the data of Global Financial Integrity (GFI) illustrated that Indonesia is among the top 10 developing countries – which have the highest value of illicit financial flows. This article seeks to explain the nature of illicit financial flows on extractive industry, the causation of why Indonesia’s extractive industry is prone to the illicit financial flows, and finally the recommendation in addressing the issue. In doing so, the researchers conduct the qualitative desk research on explanatory methodology. The result explains that at least there are two natures of illicit financial flows on extractive industry, the behavior of rent-seeking and the dynamics of commodity prices. This article also found out that there are three main sources of regulatory vulnerability which may accommodate the rent-seeking behavior – which directly and indirectly influence the illicit financial flow, which are the different sets of revenue data, arm’s length measurement within the vulnerable enforcement, and regarding the cost recovery scheme. Other than that, the multi-level governance context shown by the decentralization policy of natural resources in Indonesia widens the loopholes of Indonesia’s extractive industry illicit financial flows.

“Extractive Industry, Policy Innovations, and Civil Society Movement in Southeast Asia: An Introduction”

Said innovative policy and influencing movements, the circumstance of governing natural resources has been changing in the last decade. Along with the wave of democratization in the late 1990s, the global norms of transparency and accountability reach new leverage today, including in Southeast Asia. The norms ignite the active participation of civil societies in controlling extractive governance – a praxis that never been occurred in two or three decades ago. Meanwhile, the governments require people active participation to advance people trust and political legitimation. Innovative policy and influencing movements stand at the central argumentations of this book. Perceive as an introduction, this book denotes contributions on the extractive industry governance by using the lenses of civil society movements to acquaint intricacy of the sectors. There is a “resource curse” or paradox of plenty refers to the paradox that countries with an abundance of natural resources tend to have less economic growth and worse development outcomes. Therefore, the civil engagement has been perceived as a tool to ensure the benefit of extractive industries run for the greatest benefit of the people, as well as mitigates the risk and undesirable impacts of the extractive operations.Throughout the selected articles, the book addresses on how civil societies engage in the extractive industries governance and through what mechanisms. Instead of outlining resource revenues management as the crucial aspects to be monitored by the citizens, this book rather highlights political perspective to challenge conventional understanding that extractive industries are pure – exclusively – economic affairs. The analysis convinces that extractive industry is highly political since they draw elites into the core decision-making. The high intensity of money and high technology within sectors subsequently renders those activities beyond the reach of the public. Thus, strong civil societies with the active participation are required to undermine oligarch notions and miss use power of the extractive sectors.The discussion of civil society engagements in this book is divided into process and results. The selected cases depict experiences from the local, national, and transnational contexts enrich the discussion and provide civil society movements in a broader sense. The multi-governance perspectives are used to picture the multiple factors enabling the movements, including various challenges and opportunities for the engagements. The elaboration on the book’s content will become the entry point to the more critical discussion in the subsequent of this review.

Transparency initiatives and Tanzania’s extractive industry governance

ABSTRACTThe proper management of natural resources and its proceeds is critical for resource-rich countries. Many resource-rich countries have arguably been plagued by aspects of what scholars call ‘the resource curse’. Overcoming ‘the curse' has thus occupied center stage in studies about extractive resource governance. The Extractive Industries Transparency Initiative (EITI) has been promoted as having the potential to overcome some aspects of the resource curse especially the ‘rentier politics’. Several countries have adopted and domesticated the initiative. However, studies on transparency present contradictory findings about the usefulness of the initiative. This paper examines Tanzania’s adoption and implementation of transparency in extractive sector governance. The paper examined Tanzania’s EITI implementation process, its reconciliation reports and how these reports are used by the parliament, media and civil society to push for governance improvements in the sector. The review of these key documents found that adoption and implementation of the EITI has improved the extractive sector governance by making it more transparent and accountable.

Papua New Guinea and the Natural Resource Curse

Several empirical studies have found that countries experience slower rates of economic growth when exports are concentrated in natural resources (NRs). Various potential channels for this relationship have been identified including: Dutch disease; volatility in the terms of trade; and impacts on governance. This paper explores whether Papua New Guinea (PNG), a resource-rich state in the South Pacific, displays signs of suffering from the ‘NR curse’. PNG displays some evidence of Dutch disease in the decline of local manufacturing in the past decade alongside exchange rate appreciation. This may be further exacerbated by large-scale exports of liquefied natural gas in future years. Extractive industry governance is a pressing challenge for PNG and the paper makes suggestions for reform in revenue management and spending.

Aid with Blinkers: Environmental Governance of Uranium Mining in Niger

Summary The role of development cooperation in fostering improved environmental governance of extractive industries in African countries exposed to the expanding global uranium frontier remains ambiguous. With primary data, this paper demonstrates how foreign aid to Niger has ignored grievances on grave environmental impacts and rampant institutional failures while a crisis discourse on desertification and food insecurity diverts attention from geopolitical interests in mineral wealth. We argue that aid delivery remains insufficient to address structural deficiencies cemented by decades of investment-friendly ‘politics of mining’ and conclude that domestic reforms must be backed by stronger transnational accountability mechanisms to overcome corporate impunity.

Underground political ecologies: The second Annual Lecture of the Cultural and Political Ecology Specialty Group of the Association of American Geographers

Based on the 2011 Annual Cultural and Political Ecology Specialty Group Lecture, this paper makes the case for a political ecology of the subsoil. Arguing that subsoil resources have received comparatively little attention within the wider corpus of political ecological writing, the paper explores several ways in which the extraction of mineral and hydrocarbon resources is constitutive of, and constituted by, wider capitalist political, economic and institutional arrangements. Drawing on material from El Salvador and the Andean countries, the paper explores the contemporary governance of extractive industries, and points to significant convergence among the approaches taken by neoliberal and ostensibly post-neoliberal regimes alike. The intersections between the extractive economy, livelihoods and patterns of social protest are also explored. Through these examples, the paper also highlights the ways in which “activist political ecologists” play important roles in counter-movements seeking to re-govern the extractive economy. These countermovements are found in both civil society and different parts of the state. Such activist political ecologists are central to the broader enterprise of an “underground political ecology” and are often vital to the success of scholarly interventions in such political ecologies.