Moving Forward with Contract Monitoring in Latin America

Raúl Velasquez of Fundación Jubileo, Juan José Herrera of Grupo Faro and Fernando Patzy of RWI discuss contract monitoring.
Country: Latin America
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As part of the VII Latin America Regional Network meeting in Lima from 26-28 November, Revenue Watch led a session on contract transparency and monitoring, where civil society partners from Bolivia, Brazil, Mexico and Peru shared their work on this issue. Since taking up these issues, CSOs in these countries have realized contract transparency and monitoring can often be a daunting task.

Two year ago, RWI’s partner in Mexico, FUNDAR, decided to look at service contracts signed by the national oil company PEMEX and private companies operating in the country's oil fields. Although the law says all these contracts and supporting documents should be public, FUNDAR found some were missing. When PEMEX failed to respond to FUNDAR's request for access to the materials, the organization's first step was to go to the Federal Institution for Access to Information and Data Protection (IFAI) and file a claim against PEMEX. The IFAI ruled in favor of FUNDAR, forcing PEMEX to release the information. PEMEX complied, but this meant boxes arrived at FUNDAR’s office door containing over 50,000 pages for which they had to pay approximately $2,000.

For Aroa de la Fuente, head researcher on public budget and extractive industries in FUNDAR, this clearly shows how difficult it is for the common citizen to access, let alone analyze or monitor contracts. “In FUNDAR, we had a budget and a lot of time allocated to doing this, and it was still really hard!”

But after making sure contracts were in fact publicly available, one more challenge came. How would they analyze all of this? In addition to its own efforts, FUNDAR sought technical assistance from other institutions, including RWI’s legal team in New York.

Latin American CSOs have also worked to disseminate the contents of contracts, as well as their own analysis, to citizens.

In Bolivia, Fundación Jubileo (FJ) has carried out training workshops with national government officials as well as with local authorities in Tarija, the region where 70 percent of the country’s natural gas is produced. Through these trainings, FJ has been trying to persuade local authorities to take on the oversight role assigned to them by the country’s legal framework. “Some of the local government officials travelled to the extraction sites to carry out their oversight responsibilities,” said Raul Velasquez, FJ’s expert on hydrocarbon contracts, “but once they got there, they had no clue what to do. They just looked around, overwhelmed by the size of it all. So we have been showing them the topics which they should follow up on and the tools the contracts give them to do so.”

In Ecuador, Grupo Faro analyzed and published a citizen-friendly report on the contract signed by the Ecuadorian government with a Chinese mining company, the first large-scale mining project in the country. To make the terms and content of the contracts more accessible to the public, Faro staff used their website and Facebook to explain to followers what the contracts mean and how to read them.

It is clear these organizations have a long distance to travel as they continue getting requests from government, both at the national and local level, as well as media, to help analyze and monitor contracts. But they are all committed to continue working on this issue that is crucial for citizens in their countries to get the most from natural resource extraction.

Claudia Viale is RWI Latin American Research Assistant.

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