Call for transparency in commodities trade

Geneva: The prospects for greater transparency in the commodities trading sector will be examined at UNCTAD's 2014 Global Commodities Forum (GCF), part of the event's overall theme of 'Global value chains, transparency and commodity-based development', at the Palais des Nations on April 7 and 8.

Since 2010, legislators in the US and Europe have enacted strict new disclosure rules for payments made to governments by companies involved in oil, gas, mining and forestry projects - the so-called extractive sector.

This reform movement now looks set to turn its attention to the traditionally secretive trading sector, which buys commodities from producers in developing countries and sells them to markets around the world.

The Forum will focus on the challenges faced by commodity-dependent developing countries (CDDC), or countries for which raw commodities, such as oil, gas, minerals or grains, represent more than 60% of exports.

Transparency and accountability are ongoing concerns for CDDCs, which, despite the boom in commodity prices that began in 2003, have been unable to convert these windfall revenue into durable development outcomes for their citizens. In 2011, for example, nine of the 12 countries at the bottom of the Human Development Index (HDI) were rich in natural resources.

Dr Peter Eigen, delivering the keynote address on the GCF's transparency sub-theme, will outline developing countries' need for enhanced transparency and accountability in the global commodities trade, and will propose a way forward that forum participants will debate over the two-day event.

Dr Eigen founded Transparency International and is one of the 10 members of Kofi Annan's Africa Progress Panel.

The commodities trading sector is linked to the challenges facing CDDCs through illicit physical and financial flows.