Who Benefits? (AfrOil)
Vice President for Programs and Senior Fellow Todd Moss's work on the oil-to-cash model is featured in AfrOil.
The following article can be found in its entirety in AfrOil, a NewsBase publication.
Perhaps the top concern levelled at resource production throughout Africa is how best to spread the benefits to the citizens. New countries – such as Uganda, Mozambique and Kenya – are proving up oil and gas reserves, moving closer to a point where dollars will start to flow into treasuries. The pressure is on, therefore, to avoid repeating the fate of Nigeria, which is the poster child of dysfunctional resource management.
One process gaining ground recently is known as “oil-to-cash,” modelled after the system used in Alaska under which some revenues from energy production are held by a fund, which pays cash direct to citizens.
“Each individual is equally entitled to a share of the profits”, the Center for Global Development’s (CGD) senior fellow, Todd Moss, told AfrOil. “We’re trying to set out the principles that a significant share – obviously it wouldn’t have to be 100% – of oil revenues would be distributed to individuals on a regular and transparent basis.”
Establishing and affirming the link between the citizen, the government and the natural resources being produced would help make it in everyone’s interest for operations to continue. Each government would also be able to levy taxes on the cash payments to its people. “Most developing countries have an absolutely tiny tax base and this system seems to be a good way to develop that for the long term”, Moss continued.
