MARCH 10 2017 (The Conway Bulletin) — Azerbaijan quit the Extractive Industries Transparency Initiative (EITI), a governance watchdog used as a guide by financial institutions to decide whether to give out loans, 24 hours after its membership was suspended for failing to meet a number of demands.
By quitting the EITI, Azerbaijan risks jeopardising multi-billion-dollar loans from financial institutions such as the European Bank for Reconstruction and Development (EBRD) and the World Bank to build a $46b gas pipeline to Europe.
Announcing Azerbaijan’s decision to quit the EITI, Shahmar Movsumov, head of the SOFAZ, Azerbaijan’s state oil fund and the country’s top representative at the EITI, said the EITI had been infiltrated by groups which have shifted its agenda away from transparency in the extractive industries towards concerns about human rights and media freedom.
“We consider the Board’s decision on suspension of Azerbaijan as an unfair one,” he said. “The irrelevant facts introduced by different advocacy groups on various occasions show that the Initiative failed to stick to its original mission and objectives.”
The day before at its meeting in Bogota, the EITI had suspended Azerbaijan’s membership for failing to make sufficient progress in improving human right and NGO freedoms.
The move was welcomed by rights campaigners. Tom Mayne, a freelance consultant, said the EITI needed to throw Azerbaijan out of the group to retain its credibility.
“Transparency of oil revenues and respect for civil society go hand in hand, and both the EITI and independent observers have ruled that Azerbaijan has not created the space for free and open discussion of what happens to oil revenues,” he said.
The EITI is based in Oslo. It was set up in 2003 with the aim of setting “the international standard for transparency and accountability around a country’s oil, gas and mineral resources”.
>>This story was first published in issue 320 of The Conway Bulletin, a weekly independent newspaper covering Central Asia and the South Caucasus.