Transparency In Trade Negotiations In Term Paper

Length: 9 pages Sources: 11 Subject: Economics Type: Term Paper Paper: #13307017 Related Topics: World Trade Organization, Nigeria, Negotiation And Conflict Management, Mineral
Excerpt from Term Paper :

The criteria established by the EITI for control of revenues and payments are follows:

Regular publication of all material oil, gas and mining payments by companies to governments ("payments") and all material revenues received by governments from oil, gas and mining companies ("revenues") to a wide audience in a publicly accessible, comprehensive and comprehensible manner.

Where such audits do not already exist, payments and revenues are the subject of a credible, independent audit, applying international auditing standards.

Payments and revenues are reconciled by a credible, independent administrator, applying international auditing standards and with publication of the administrator's opinion regarding that reconciliation including discrepancies, should any be identified.

This approach is extended to all companies including state-owned enterprises.

Civil society is actively engaged as a participant in the design, monitoring and evaluation of this process and contributes towards public debate.

A public, financially sustainable work plan for all the above is developed by the host government, with assistance from the international financial institutions where required, including measurable targets, a timetable for implementation, and an assessment of potential capacity constraints (The EITI criteria, 2006, p. 2).

There has in fact been some progress as made as well by virtue of the operation of these NGOs around the world in improving transparency in trade negotiations, but they have managed to do so without any substantive regulatory authority or enforcement power. These organizations have also enjoyed a degree of flexibility in achieving such progress that is not typically seen between countries during trade negotiations. For instance, none of the NGOs involved in the EITI are restricted to or confined by regulations within states; for example, Transparency International, the most successful international anti-corruption NGO, is not itself a statutory body (Kuper, 2004). Nevertheless, this agency's measures and recommendations have been incorporated into governmental regulatory regimes both within and beyond borders (Kuper, 2004).

In their chapter, "Political Globalization," Short and Kim (1999) report that," Transparency International has promoted numerous national chapters combating corruption around the world. In this context, corruption in Nigeria, the most corrupted country in the world, is a problem that the whole world has to be concerned about and one that the international community should continually request the Nigerian government to correct" (p. 113). In fact, Nigerian President Olusegun Obasanjo has been an enthusiastic supporter of the new Extractive Industries Transparency Initiative, as demonstrated at a top-level meeting held on Transparency and Accountability in Resource Management on January 27, 2005 (Nation with a new image, 2005). "This early fruit of the New Partnership for Africa's Development (NEPAD) is widely seen as a pattern for other African oil (and solid minerals) producers lacking Nigeria's clout to follow" (Nation with a new image, 2005, p. 33). The results of these initiatives has been extremely positive. According to Siddiqi (2005), "Africa's most populous country is finally putting its house in order and the strength of economic revival has exceeded expectations. The favourable external environment continues to underpin economic activity, however, buoyant domestic demand along with private consumption and business investment are equally behind sustained real GDP growth, averaging 5.9 per cent/year between 2001-05 -- the best performance for decades" (p. 27). Nevertheless, Transparency International continues to tank the levels of corruption in Nigeria among the highest in the world. According to Goodling (2003), "Pervasive corruption appears to permeate many levels of Nigerian society. The current Nigerian government, however, has taken great steps to combat this problem through cooperation with the U.N. Global Programme" (p. 997).

The implications of the EITI initiative on Nigeria and other developing nations have been profound and relatively quick to be felt by the countries involved. For instance, "Countries such as India which have been suffering from trade diversion due to being excluded from major regional trading...


The new transparency mechanism provides for early announcement of any RTA and notification to the WTO" (WTO transparency mechanism for RTAs, 2006, p. 2). In addition, the report also suggests that this latest initiative, currently being implemented on a provisional basis, will help achieve unanimity among the WTO representatives and streamline the existing conflict resolution procedures to reduce backlogs of cases and improve the responsiveness of the process (WTO transparency mechanism for RTAs, 2006).

The need for these comprehensive reforms has also become increasingly evident in recent years, but were not entirely unexpected. "From the beginning," Ehrenhaft notes, "the GATT addressed the settlement of disputes between trading nations. Disputes were recognized as inevitable. The GATT dispute resolution procedure was part mediation and part arbitration. It depended on the good offices of experienced representatives of unaffected members to help the disputing parties find common ground to settle their differences" (2001, p. 963). The controlling language of Article XXIII of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) contained in of GATT 1994 provides that "[w]hen Members seek the redress of a violation of obligations or other nullification or impairment of benefits under the covered agreements... they shall have recourse to, and abide by, the rules and procedures of this Understanding" (cited in Lindsy, 2003 at p. 1277). According to this author, "The mandatory language suggests that parties claiming an impairment of GATT benefits must bring these claims before the WTO dispute settlement bodies" (Lindsey, 2003, p. 1277). To the extent that participating nations conform to these requirements is likely the extent to which they will be able to prosecute their developmental goals and create sustainable programs to address their wide ranging social problems, but the fact remains that conflicts are inevitable and it remains to be seen whether these initiatives will achieve their intended goals.


The research showed that trade openness, education, transparency, and external associations all play important roles in helping developing nations become stronger and in developing more effective institutions. A number of important initiatives have been accomplished in these areas to this end in recent years, such as the Extractive Industries Transparency Initiative and WTO Dispute Settlement Bodies described above, but the research also showed that much more remains to be done. In fact, many experts suggest that transparency remains too limited despite the important steps that are being undertaken through the EITI and the conflict resolution approaches offered by WTO Dispute Settlement Bodies. In the final analysis, even if they did not accomplish anything else, these initiatives represent the beginning of an important trend that addresses longstanding disparities between developing and emerging nations by providing reliable mechanisms that improve investor confidence and ensure that a portion of the revenues generated from a country's natural resources are reinvested in terms of infrastructure investment and poverty relief efforts.


Auty, R.M. (1993). Sustaining development in mineral economies: The resource curse thesis. New York: Routledge.

Cohen, S.D. (2002). Fundamentals of U.S. foreign trade policy: Economics, politics, laws, and issues, 2nd ed. Westview Press.

Crook, C. (2006, October). The fruitful lie. The Atlantic Monthly, 30.

Ehrenhaft, P.D. (2001). The role of lawyers in the World Trade Organization. Vanderbilt Journal of Transnational Law, 34(4), 963.

EITI criteria. (2006). About EITI: Principles and Criteria. Retrieved November 30, 2006 at

Goodling, N.A. (2003). Nigeria's crisis of corruption-Can the U.N. global programme hope to resolve this dilemma? Vanderbilt Journal of Transnational Law, 36(3), 997.

Kline, J.M. (2005). Ethics for international business: Decision making in a global political economy. London: Routledge.

Kuper, A. (2004). Democracy beyond borders: Justice and representation in global institutions. Oxford, England: Oxford University Press.

Lindsy, P. (2003). The ambiguity of GATT Article XXI: Subtle success or rampant failure? Duke Law Journal, 52(6), 1277.

Maxwell, S., & Stone, D. (2005). Global knowledge networks and international development: Bridges across boundaries. New York: Routledge.

Nation with a new image. (2005, March). African Review of Business and Technology, 41(3), 33.

Statement of the Pontifical Council for Justice and Peace of the Mini-Ministerial Meeting of the World Trade Organization. (2006,…

Sources Used in Documents:


Auty, R.M. (1993). Sustaining development in mineral economies: The resource curse thesis. New York: Routledge.

Cohen, S.D. (2002). Fundamentals of U.S. foreign trade policy: Economics, politics, laws, and issues, 2nd ed. Westview Press.

Crook, C. (2006, October). The fruitful lie. The Atlantic Monthly, 30.

Ehrenhaft, P.D. (2001). The role of lawyers in the World Trade Organization. Vanderbilt Journal of Transnational Law, 34(4), 963.

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