Corruption in Natural Resource Management - An Introduction
Kolstad, Ivar, Tina Søreide, Aled Williams (U4 Brief 2008:2)

Natural resources often provide fertile ground for corruption. Since a substantial number of partner countries in development cooperation are richly endowed with natural resources, these contexts pose a particular challenge for effective donor action. The risk of corruption cuts across natural resource sectors - from non-renewable resources such as oil, gas, minerals and metals, to renewable resources such as forests, fisheries and land. There are, however, important variations in the challenges presented by these sectors and the manner in which corruption in relation to them can be addressed.

Shrinking oil: Does weak governance and corruption reduce volumes of oil produced?
Al-Kasim, Farouk, Tina Søreide, Aled Williams (U4 Issue 2010-3)

Prominent contributions to the resource curse literature suggest that weak governance and corruption are key factors behind continued poverty in resource-rich countries. How poor governance and corruption influence revenue management and the possible welfare benefits derived from oil are widely discussed. How they impact upon volumes of oil produced, however, attracts little attention. This U4 Issue paper addresses the basic forms suboptimal solutions in oil production may take. It aims to expand our understanding of how weak governance and corruption impact upon the oil sector and the possible welfare benefits derived from oil. Such explanations are of particular concern to donors and other actors engaged in policy reform and capacity building initiatives linked to oil governance in developing countries.

Does aid work? Reflections on a natural resources programme in Tanzania
Jansen, Eirik G. (U4 Issue 2009:2)

A former programme officer at the Norwegian Embassy in Tanzania considers challenges to aid effectiveness in a major natural resources programme. After twelve years of support by the Norwegian government totalling about US$ 60 million, an evaluation by independent consultants revealed in 2006 that up to half of the funds allocated may have been lost through corruption and mismanagement. Explanatory factors discussed include inadequate analysis of the sector’s political economy, future oriented strategies and plans from the donor side, over-reliance on the government’s financial management systems, report based evaluations by interested parties, and the “pipeline problem” common in development aid. The author concludes with ideas for avoiding these pitfalls through a more sophisticated approach to budget and programme support.

Improving the framework? Institutional reform and corruption in the water sector
Butterworth, John and Jean de la Harpe (U4 Brief 2009:28)

It has been recognised that the world’s failure to provide many of its citizens with access to water and sanitation is an issue of governance, and institutional reforms have been a constant feature in the drive for better sector performance. Reducing corruption is sometimes one of the objectives of decentralisation, privatisation, harmonisation and other reforms, but it is often not considered directly. Since institutional reforms may either reduce or even worsen corruption, it is important to include corruption risk assessments and mitigation measures in planning such interventions.

Not so petty: Corruption risks in payment and licensing systems for water
Butterworth, John and Jean de la Harpe (U4 Brief 2009:26)

The water “business” involves large numbers of consumers using water in different ways including households, industries, and farms. Management of water at the user level, and the associated collection of charges or fees, carries a potential corruption risk. This U4 Brief focuses on the risks at the service provider-consumer interface associated with these small but numerous transactions, and how donors may help prevent so-called petty corruption. The related losses of revenue and harm to consumer confidence can seriously threaten the financial sustainability and viability of service providers.

Reforming corruption out of Nigerian oil? Part one: Mapping corruption risks in oil sector governance
Gillies, Alexandra (U4 Brief 2009:2)

Oil dominates the Nigerian economy and generates the vast majority of government revenues. At the same time, Nigeria is perceived as one of the world's most corrupt countries, and significant levels of corruption are said to exist within its oil sector. The complex and largely opaque operations of the oil industry make it difficult to establish exactly how, when and to what extent corruption takes place. This U4 Brief attempts to shed light on how public sector institutions governing the Nigerian oil sector permit the existence of corruption. Six areas of corruption risk are addressed: the awarding of licenses; the awarding of contracts;  bottlenecks and inefficiencies; the role of bunkering; the exportation of crude; and importing refined products. The Brief is the first in a two-part series, the second of which addresses policies and programs that aim to stem corrupt practices in the Nigerian oil sector.

Reforming corruption out of Nigerian oil? Part two: Progress and prospects
Gillies, Alexandra (U4 Brief 2009:6)

In Nigeria, as elsewhere, corrupt practices impair oil sector performance. This U4 Brief looks at five approaches to advancing anti-corruption reform in Nigeria’s oil sector: the legal and regulatory framework; open and competitive award procedures; process and revenue transparency; investigation and prosecution of corruption; and oversight and accountability measures. The state of reform in each area is addressed, as are ways forward of potential interest to donors in the country. The Brief is the second in a two-part series: the first describes the most likely sites of corruption in the governance of Nigeria’s oil sector. The series aims not only to provide insights into anti-corruption related reform in Nigeria but also in other oil-rich countries that receive development assistance.

Reforming wildlife governance in East and Southern Africa: The role of corruption
Nelson, Fred (U4 Brief 2009:12)

Corruption plays a role in structuring wildlife governance systems in many African states. Donor efforts to support wildlife reforms in East and Southern Africa have often struggled to achieve impact due to continuing weaknesses in local rights to access and control wildlife’s economic value. Comparing wildlife governance in Namibia and Tanzania, this U4 Brief argues donors need to develop a clearer understanding of the political-economic dimensions of wildlife governance reforms and the role corruption plays in shaping policy-makers’ incentives.

Grand designs: Corruption risks in major water infrastructure projects
Butterworth, John and Jean de la Harpe (U4 Brief 2009:27)

Multi‑million dollar water infrastructure projects carry some of the largest corruption risks in the sector linked to the procurement of civil works and associated design, supply and consultancy services. The potential for grand corruption in big dam projects and upgrading urban water and sanitation systems can be so significant as to skew policy making towards the most lucrative investments. “White elephants” such as overly sophisticated new wastewater treatment plants may come at the expense of maintenance of existing assets and more appropriate lower cost technologies and approaches.

Grand Corruption in the Regulation of Oil
Al-Kasim, Farouk, Tina Søreide, Aled Williams (U4 Issue 2008:2)

This U4 Issue explores the topic of grand corruption in the regulation of oil. It focuses on how and why corruption can distort or prevent efficient regulation of the oil sector. The authors suggest that, though voluntary initiatives and capacity building programmes are important, they should not replace establishment of formal state-sponsored regulations.

Tackling Corruption in Oil Rich Countries: The Role of Transparency
Kolstad, Ivar, Arne Wiig, David Aled Williams (U4 Brief 2008:3)

Corruption is a huge problem in many developing countries rich in oil and other natural resources, and is central in explaining why these countries perform badly in terms of socio-economic development. Transparency reform has recently been viewed as a key factor in addressing corruption and other resource-curse related problems. But what role does transparency actually play in tackling corruption in oil rich countries?

Mission Improbable. Does Petroleum-related Aid Address Corruption in Resource-rich Countries?
Kolstad, Ivar, Arne Wiig, Aled Williams (U4 Issue 2008:3)

Petroleum-related aid programmes and projects are a key part of donor activities in oil-rich developing countries. This U4 Issue explores the petroleum-related activities of three bilateral donors: Norad, CIDA and USAID. While governance issues are beginning to receive more attention in these types of programmes, they still form a minor part of programme activities. The petroleum-related aid activities of the donors in question address the issue of corruption only to a limited extent. Given the commercial and political interests of donor countries, questions about the integrity and credibility of these types of programmes can be raised. Moreover, the narrow, sector focus of these programmes makes it unlikely that they will produce the institutional changes needed to lift the ‘resource curse'.

Corruption and Forest Revenues in Papua
Setiono, Bambang (U4 Brief 2008:18)

Under a sustainable, well-managed, logging regime, Papua - the most densely forested part of Indonesia - can potentially contribute substantial forest revenues for socio-economic development. Yet, it remains the poorest region in the country, in part due to widespread corruption involving public and private actors. Specific changes to the forest revenue management system are required to address  corruption. Donors can support these changes by engaging in capacity building for auditors, accountants and investigators, and through technical assistance for improving forest monitoring and production reports.

Corruption and Industrial Fishing in Africa
Standing, André (U4 Issue 2008:7)

Africa's marine resources are increasingly in demand and are gaining in geopolitical importance. Competition between key fishing nations for access and control over marine resources is joined by competition between local communities and industrialised foreign fishing fleets. In this context, incentives for a range of illegal activities abound, to which African nations often have weak capacity to respond. The author describes key areas of concern relating to corruption and the exploitation of marine resources in African countries by foreign fishing fleets. Policy reforms that may reduce incentives and opportunities for corruption in fisheries management are also discussed.

Corruption and Commercial Fisheries in Africa
Standing, André (U4 Brief 2008:23)

Heightened competition and considerable illegal fishing by commercial boats, suggest that incentives for corruption in African fisheries are high. Dependence on revenues and investments from foreign countries, as well as conflicts of interests, are two factors that may limit law enforcement and the effectiveness of marine inspections. Law enforcement and prosecutions may also be thwarted by bribe payments and the complicity of officials in crimes. The most effective and realistic way of countering corruption appears to be through strengthening transparency and accountability. African civil society has an important role to play in scrutinising fisheries access agreements, tracking court cases and monitoring government budgets.

Transparency in oil rich economies
Kolstad, Ivar and Arne Wiig (U4 Issue 2007:2)

Corruption is a huge problem in many developing countries that are rich in oil and other natural resources. It is central in explaining why resource rich countries perform badly in terms of socio-economic development. Transparency has recently been viewed as a key factor in reducing corruption and other dysfunctions in natural resource rich countries. This U4 Issue addresses the relationship between transparency and corruption, with an emphasis on oil rich countries. In particular, it focuses on some of the main corruption related problems caused by limited access to information, using the case of Angola. It also focuses on the approach of current transparency initiatives, such as the Extractive Industries Transparency Initiative (EITI).

Forest concessions and corruption
Søreide, Tina (U4 Issue 3:2007)

The forest industry has the potential to contribute to the economy and increase state revenues in many developing countries. The realisation of these opportunities depends on the governance of the forest industry and the ways in which forests are managed. Donors can play an important role in this process by providing funding and other support to developing country governments. This U4 Issue paper discusses how corruption influences the logging industry and deprives developing country governments of important revenues. It explains the concession system in forestry and the risks of corruption in forest sector contracts. Some policy implications are drawn, suggesting a ranking of strategies, with a particular focus on aid-related implications.