The workshop offered a rare opportunity for dialogue between the different actors and for experience sharing between countries at different levels of natural resource extraction. A recurrent theme was how to avoid the pitfalls of the ‘resource curse’, with key lessons from the Norwegian petroleum experience. Mozambican Vice-Minister of Energy, H.E. Jaime Himede, Norwegian Ambassador, H.E. Tove Bruvik Westberg and Chairperson of the Mozambican National Petroleum Institute, Mr Arsenio Mabote, all participated in the opening ceremony.
The Workshop was convened by the Norwegian Embassy in Maputo and the Norwegian International Programme for Petroleum Management and Administration (PETRAD), as part of the Norwegian Government’s Oil for Development Initiative (OfD). Good governance represents a challenge in most oil rich economies, and the striving for transparency and fighting corruption practices require constant focus as well as cross border cooperation and sharing of country experiences. To this end, the objective of the workshop was to create an interactive arena for learning, discussing and networking as well as consulting with experts. The seminar had the advantage of facilitating dialogue and sharing of experiences between lusophone countries at different stages of resource extraction.
The ‘Resource Curse’
Among the key lectures was Mr. Farouk Al-Kasim, the current president of the Stavanger-based consultancy company PETROTEAM. Al-Kasim’s extensive experience from various positions in the private and public sector relevant to resource management makes him one of the leading experts in the petroleum sector in Norway. In his lecture, Al-Kasim highlighted the risk of what he referred to as the ‘oil curse’ faced by resource rich countries. The oil curse is characterized by a total domination of natural resource revenues in the national economy, leading to a negative growth in other economic activities.
Numerous natural resource rich countries, especially in the developing world, continue to suffer from such negative developments following the discovery of natural resources. Al-Kasim emphasized the decisive role played by strong laws and regulations as well as strong institutions to avoid the trappings of the oil curse. Accordingly, the issue of laws and regulations in the petroleum sector was a main priority throughout the seminar, with emphasis on lessons learned from the Norwegian experience with oil extraction.
The Norwegian Experience
Norway is among the countries that have succeeded in converting natural resources into increased welfare for the population in general. Norwegian ambassador to Mozambique, H.E. Tove Bruvik Westberg, stressed in her address to the seminar that feeble management of oil resources, which does not focus on sustainable development, can produce a ‘resource curse’. Norway managed to avoid this, according to Westberg;
- Norway managed its oil sector so as to achieve significant revenues. Our experience showed how a strong, stable and transparent administration in the petroleum sector is important to ensure that such revenues are used to promote the sustainable and equitable development of the country
Bjørn-Erik Leerberg, a Norwegian lawyer and petroleum law expert, followed up by emphasizingthe importance of saving and investing revenue to ensure that it benefits future generations. Stressing this point, Leerberg asserted that “natural resource extraction is conversion of capital, not income”. In addition to the necessity of retaining long term vision for revenues, key lessons included the need to stabilize income and save other parts of the economy from the potential negative impact of resource revenues.
Mozambique
The four Lusophone countries present at the seminar find themselves in different situations with regards to natural resources. While Angola is already Africa’s second largest oil exporter and Timor-Leste has made great strides in the management of their oil resources in recent years, São Tomé y Principe is in the early stages of this process. Host country Mozambique is already exporting natural gas, and there are currently explorations underway to uncover possible oil reserves off the Mozambican coast. Speaking to reporters at the seminar, chairperson of the Mozambican National Petroleum Institute (NIP), Arsenio Mabote, claimed that Mozambique is well prepared for a scenario with oil discoveries;
- What is important is to have a harmonized institutional and legal framework, so that when the existence of oil is proved, it can be exploited without problems. Right now we have the coordination and harmonization that can avoid damage in the future
With the exception of major oil exporter Angola, all of the participating countries at the seminar are candidate members to the Extractive Industries Transparency Initiative (EITI). The EITI seeks to increase transparency regarding payments by companies to governments and to government-linked entities, as well as transparency over revenues by those host country governments. For its part, Mozambique has already established a national committee to oversee the EITI – processes, which includes representatives from civil society organizations.
Civil Society Participation
A distinguishing feature of the Petrad seminar was the participation of representatives from civil society from all of the participating countries. Civil society can be a valuable contributor to sound resource management by providing citizens’ voice and to hold government accountable for policies. Good governance in the petroleum sector entails consulting all relevant stakeholders in decision-making processes, and to this end civil society is potentially an invaluable contributor.
Among the representatives from civil society was Tomás Selemane, Programme Officer at Centro de Integridad de Pública (CIP), a Mozambican NGO working to promote integrity, transparency, ethics and good governance in the public sphere in Mozambique. According to Selemane, the creation of a ‘triangle of dialogue’ between authorities, private sector and civil society is vital;
- This dialogue offers the major benefit of balancing the interests of the different actors. Private sector wants to maximize profit, but they must be guided by a regulatory framework defined by the government. The government expects the private sector to invest, and civil society to monitor activities and ensure that the legal framework is observed.