Gulf states must fight corruption

Dubai: Two non-governmental organisations are urging the Gulf states to join an association of oil-producing countries dedicated to fighting corruption and increasing transparency.

Representatives from Transparency International (TI), based in Germany, and the Open Society Institute, based in the US, yesterday said oil-producing Middle Eastern countries should open the books and disclose how much revenue they receive and how the proceeds are spent.

The two are urging Gulf countries to join the Extractive Industries Transparency Initiative (EITI), an association of 22 nations in Central Asia, Africa and South America.

"When people pay taxes they ask their government what it is doing with those taxes, but in with a country with extractive industries, there is less pressure for that accountability, said Aryeh Neier, president, Open Society Institute, during a roundtable discussion at the Arab Strategy Forum.

"There is no way for the citizens to take part in such discussion unless there is knowledge of what the revenues are and how the revenues are spent."

Unfortunately, said Neier, there is virtually no engagement in the initiative by governments or the private sector in the region.

"I believe that if they would take part in the initiative by providing accountability for their revenues, they would enhance their capacity to address the needs of their countries," he said.

Obaid Humaid Al Tayer, speaking at the same discussion, said the Arab world created large governments, institutions and companies, often run by the same people.

"The same people who sit on the executive branch are the same people who sit on the legislative branch," he said. Al Tayer also said Arab governments haven't started following international accounting standards.

According to EITI, which was launched in 2002, revenues from oil, gas and mining companies should be important engines for growth and development.

However, progress is often stymied because the lack of accountability and transparency in these revenues can lead to corruption, conflict and poverty.

"I have a feeling that most of the countries in the Arab world are doing very badly," said Peter Eigen, founder and chairman of TI, when asked about the results of its latest report, 2006 Transparency International Corruption Perceptions Index.

On its website, TI said of the Middle East: "The primary challenges facing civil society organisations in the fight against corruption in the Middle East and North Africa are non-democratic government structures, coupled with little manoeuvring space for civil society amidst stagnant, heavily state-managed economies."

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