Lecture Notes: Mining Revenue Accountability in Burkina Faso

Introduction

• Topic: Accountability, transparency, and the future of Burkina Faso's wealth.
• Focus on a recent audit exposing systemic flaws in mining revenue management.
• Thanks to the community for their support.

Context: Burkina Faso's Mining Industry

• One of Africa's fastest-growing gold producers.
• Mining contributes over 10% of GDP and employs thousands.
• Issues: Fair share of mineral wealth distribution, responsible revenue use impacting education, healthcare, infrastructure, and poverty alleviation.

Leadership and Reform

• Captain Ibrahim Traoré
  • Transitional president since 2022.
  • Prioritizes eradicating corruption.
  • Collaborated with African Organization of Supreme Audit Institutions (AFROSAI) for a comprehensive audit.
• Audit Report
  • Titled "Performance Audit of the Legal and Institutional Framework for Mobilizing Rights and Taxes from Gold and Other Precious Substance Extraction 2017 to 2022."
  • Aims to dismantle systemic graft, redirect resources towards national development.

Key Findings

1. Transparency in Mining Permits

   • Lack of transparency in granting mining permits.
   • Licenses awarded or renewed without clear criteria.
   • Government reviewing and revoking fraudulent permits.

2. Public Access to Information

   • Difficulty accessing basic data on extraction and tax payments.
   • Launched an online portal for transparency in mining contracts and statistics.

3. Oversight of Tax Declarations

   • Companies allegedly underreporting earnings.
   • Strengthened oversight with international forensic accountants.
   • Recovered millions in unpaid taxes.

4. Generous Tax Incentives for Mining Companies

   • Critique of reduced royalty rates and tax holidays.
   • Government revising fiscal code for fairer profit distribution.

5. Institutional Capacity

   • Insufficient resources and expertise in overseeing mines.
   • Training programs for inspectors, technology investments like drones and satellite imaging.
   • Established cross-agency task force.

Reforms and Actions

• Digitization

  • Digitizing procedures to reduce bureaucratic fraud.

• National Gold Reserve

  • Creation of a national gold reserve to stabilize the economy and assert economic independence.

• International Cooperation

  • Agreements with Interpol and the African Union to trace smuggled gold.

Challenges and Opportunities

• Risks to Foreign Investment

  • Concerns over deterring investment.
  • Emphasis on transparency and fairness attracting responsible partners.

• Impact on Citizens

  • Potential for mining revenues to fund education, healthcare, infrastructure.
  • Allocated recovered taxes to build clinics in mining regions.

Conclusion

• National Security and Corruption

  • Link between illicit gold and terrorism.
  • Military deployed to secure mining sites.

• International Perspective

  • Praises and skepticism from international groups and governments.

• Global Movement

  • The need for transparency in global supply chains.
  • Burkina Faso as a model for resource governance.

• Call to Action

  • Encourage staying informed and pushing for transparency.
  • Recognize the importance of public pressure and awareness in driving change.

Community Engagement

• Appreciation for community support and encouragement to join membership.
• Advocacy for transparency, accountability, and fighting corruption as a collective effort.