Whilst the development of mining generally provides a considerable boost to investment, government revenues, jobs and skills, the volatility of commodity markets and the concentrated nature of the revenues can, for otherwise poor countries, create significant macro-economic challenges, can unbalance an economy and can create opportunities for corruption.
The objective of the EITI is to improve the transparency around the generation and spending of revenues from the extractive sector so as to improve development outcomes, reduce the potential for corruption or large-scale embezzlement of funds by host governments; and to stimulate debate about the uses to which these revenues are put.
The basic concept is that oil and gas and mining companies should declare - in each participating country - the payments made to the host government (either individually or aggregated by an independent third party, with other companies in the sector). These figures are then audited to international standards and the host government is expected to make a separate declaration of the revenues received - so that the opportunities for 'revenue leakage' are reduced.
This process is then intended to lead to a dialogue, involving civil society, around public spending priorities.
Anglo American is a participant in the process through having a representative on the EITI International Advisory Council and has been involved in the development of EITI in Peru.
AngloGoldAshanti, an independently managed subsidiary of Anglo American, is involved in EITI processes in Ghana, Guinea and the Democratic Republic of Congo. The EITI is a multi-stakeholder process involving developed and developing country governments, the international financial institutions, non governmental organisations and a group of significant investors.
