By Kolawole Banwo
Recently, at international conference on Beyond Transparency: Oil and Crisis of Democratic Governance in Nigeria and Gulf of Guinea organized by SocialAction in Abuja, a paper titled Fighting Secrecy in the Oil and Gas Sector: Assessing Existing Strategies and Future Alternatives presented by Dung Pam Sha, a Professor of Political Economy and Development Studies Office of Research and Development, University of Jos, revealed that secrecy as one of the unorthodox mechanisms that characterised extractive accumulation leading to loss of state revenues to private corporations and individuals.
In his paper, Prof. Sha described financial secrecy as “a practice where bankers assures clients’ of secrecy of their transactions no matter the situation, and compacts are arrived at the specified criminal penalties on those who break the secrecy.”
Also, financial secrecy has been described in the analysis of Tax Justice Network—whose preoccupation is to illuminate shady and hidden places, financial secrecy is manifested, as a refusal to share financial information with the legitimate authorities and bodies that need it such as to tax citizens appropriately, or enforce criminal laws.
While considering the nature of financial secrecy, Prof. Sha said secrecy in the conduct of national and international corporate and government operations involves non-disclosures of transactions; non-declaration of transactions, output, expenditures and profits; over-invoicing in business transactions; transfer pricing; under-declaration of taxes due to under-declaration of profits; repatriation of profits to oversee banks; and use of tax havens.
He said financial secrecy in conduct of State and corporate affairs must be interrogated and fought because it results in corruption; erodes development potentials; facilitates expropriation of surpluses by multinational corporations and state officials; and weakens state control over processes of accumulation.
Prof Sha further mentioned as part of the models and strategies for fighting secrecy to include: transparency in oil revenue declaration and payment to government; transparency in oil revenue spending by governments; transparency in declaration of assets by corporate units and individuals; research and publication of violations in the oil and gas sector; auditing to discover anomalies; advocacy to UN and similar fora creating democratic and transparent laws; capacity building for civil society organizations, media and workers unions working on transparency and accountability in the extractive industries; street protest at national and international forums by civil society.
He said secrecy can be fought beyond transparency in oil revenues through citizens-based electoral politics and a transparent electoral process that will throw up visionary leaders; enthronement of visionary and democratic leaders to control the state; enthronement of a democratic developmentalist state by visionary leaders; review of oil and gas laws to weaken and eliminate secrecy; and routinely check of oil and gas operations by civil society.