Raw Materials Working Group News - May 2014

  1. Tax breaks for multinationals outstrip spending on schools and clinics in Sierra Leone

 

A new report, Losing Out, realized by several civil society organizations of Sierra Leone, highlights the huge amount of revenue that one of the poorest countries in Africa loses each year through tax breaks for multinationals. In 2011, Sierra Leone spent more on tax breaks than on its development priorities, with mining firms the biggest beneficiaries. The following year, the tax exemptions amounted to more than eight times Sierra Leone’s health budget and seven times its education budget, when more than 50 per cent of its citizens live below the national poverty line.

 

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2.       Who profits from Niger’s extractive industry?

 

The Open Societies Institute for West Africa (OSIWA) has published a report entitled Revenues from Niger’s extractive industries: who profits from them? The report point out that accordance with the 2010 mining constitution, 15 % of revenues from the extractive industries should be allocated to local municipalities. Yet some municipal authorities never received their revenues. The report outlined a series of recommendations, notably that the Niger government and mining companies should ensure that the extractives generate jobs for local Nigeriens.

 

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3.       What needs to be done in order for Ugandans to benefit from their oil?

 

Since the discovery of oil and gas reserves in 2006, there has been a lot of anticipation about the revenues and benefits that will accrue. They are expected to yield at least $2b per year for 30 years once oil production commences transforming the economy and transforming the lives of people by providing employment opportunities. There has been a strong call on the Government to ensure good governance in the running of the sector. CSOs have played an important role in promoting a proper management of oil and gas resources and mitigating the negative social-economic, political and environmental impacts of extraction.

 

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4.       Africa: Social Conflict Incurs Financial Cost for Extractive Industry - Study

 

The financial cost of social conflict is an important reason why companies in the mining, oil and gas industries should make more effort to ensure their projects do not provoke tensions with local communities. A study published in the Proceedings of the National Academy of Sciences noted that values and ethics - not just costs - should be motivating reasons for businesses to engage with local communities. 

 

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