MAY 4 2017 (The Conway Bulletin) — The European Bank for Reconstruction and Development (EBRD) may still lend Azerbaijan $500m for a gas pipeline linking the Caspian Sea to Europe despite Baku quitting the EITI, a global transparency watchdog.
The comments by EBRD chairman Suma Chakrabarti go against an EBRD statement last year which said Azerbaijan would have to pass the EITI’s transparency criteria to receiving funding. The EITI suspended Azerbaijan’s membership in March for failing to improve NGO laws, triggering Azerbaijani officials to walk out of the organisation.
Now, in an interview with Bloomberg, Mr Chakrabarti appeared to suggest that mission creep may be blurring the Oslo-based EITI’s remit.
“What’s happened on the EITI is very, very unfortunate,” Bloomberg quoted Mr Chakrabarti as saying. He then said that people were “worried about some of the criteria that are now being used in EITI”.
Azerbaijani officials complained that the EITI, an acronym for Extractive Industry Transparency Initiative, had drifted from its remit of improving accountability in mining and oil and gas sectors and was now acting as a watchdog on more general democracy issues.
In his Bloomberg interview, Mr Chakrabarti said that the EBRD is “progressing” its finance plans for the Southern Gas Corridor and will give a final decision by the end of 2017.
“The question really is whether the Azeris are adopting the principles, not just by saying they are but by showing transparency in what they do,” he said.
“That’s a judgment we’ll make.”
The $40b Southern Gas Corridor is a network of pipelines that should pump Azerbaijani gas from the Caspian Sea to Europe, reducing its reliance on Russia. It has political backing from the EU and business backing from BP and other multinational but corruption and human rights activists are critical of Azerbaijan and have said that Western companies and governments should not be dealing with it.
At the EITI, the head of its secretariat, Jonas Moberg, told The Conway Bulletin that Mr Chakrabarti’s interview hadn’t undermined its core mission of increasing accountability within the extractive sectors.
“Civil society needs to be able to hold their governments to account if the EITI is going to have a meaningful impact on how the oil sector is governed in a country,” he said.
Kazakhstan, Armenian, Kyrgyzstan and Tajikistan are also members of the EITI. The EITI criticised Tajikistan and Kyrgyzstan this year for making inadequate progress against its criteria.
ENDS
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(News report from Issue No. 327, published on May 5 2017)