No Free Lunch Needed When the Issue Is Corruption

Perhaps it is because people interested in combating corruption in resource-rich countries are of impeccable ethics themselves, but it took only the smallest of "bribes" -- cookies, but no lunch -- to draw a packed house in freezing weather to CGD today to discuss the Extractive Industries Transparency Initiative (EITI). Most readers of this blog are likely aware of the challenges that the "resource curse" poses for developing countries with weak institutions, where all too often much of the revenue from oil, gas, or other mineral exports is siphoned off by corrupt officials. Susan Aaronson kicked things off with a presentation on her paper investigating how the EITI could be a useful tool for governments make the difficult effort to improve governance, broadly defined. She also argues that, if implemented effectively, the EITI can create a positive feedback loop whereby civil society becomes more engaged in monitoring the government and reducing the opportunities for corruption.Nilmini Rubin, who has worked for several years with Senator Lugar as part of the Senate Foreign Relations staff, also participated and summarized the report on "The Petroleum and Poverty Paradox" that committee staff prepared late last year. Senator Lugar had summarized the key recommendations from the report in this op-ed in the Christian Science Monitor. As both of our speakers and many in the audience emphasized, sunlight is the best antiseptic. Transparency -- both about the payments made to governments and what the government does with the revenues -- is the first step in removing the resource curse.The intensity of interest in this topic was evident in the turn-out and lively discussion at the event. It's too bad we couldn't accommodate all who wished to attend! I invite all of you who are interested in this important topic to read the attached papers and continue the dialogue by adding your comments here. (For more on transparency as the solution to corruption, see the 2007 Commitment to Development Award, which went to Global Witness.)