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Informed citizenry, accountable government
and effective use of oil resources

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"Abundant natural resources can and
 should be a blessing, not a curse"

                                    Jozef Stiglitz
           The Resource Curse Revisited

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Other Information


Certain measures have already been taken to ensure transparent and accountable management of oil resources in Azerbaijan.

Azerbaijan joined the EITI (Extract Industries Transparency Initiative) and the EITI National Commission has been established to ensure transparency and accountability in management of oil revenues.

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The State Oil Fund of Azerbaijan (SOFAZ) has been created to perform stabilization and savings functions. It publishes  information, including annual revenues reports, on its internet site.

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Policy Analysis



Direct citizen participation in management of oil resources



Azerbaijan may fall victim of the "resource curse", i.e. "inverse relationship between high natural resource dependence and economic growth rates". However, transparent and accountable governance, particularly in relation to management of oil resources, can help avoiding the "resource curse".

Attempts towards increasing transparency and accountability in management of oil resources in Azerbaijan have focused predominantly on diclosing information on oil revenues. Concept of transparency, however, shall be distinguished from that of informed public participation. "Transparency is a necessary but not sufficient component of informed public participation in democracy. To have active voice, the public, or at least a representative body of the public, needs to have a legitimate and formalised role overseeing and interacting with industry and government".

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Policy Options



Three policy options for direct public participation in management of oil resources were identified through literature review and in-country discussion with experts:

  1. Dispensing oil revenues directly to citizen in form of cash payment
  2. Fiscal decentralisation of oil revenues
  3. Public hearing on oil revenues and expenditure


All three options were evaluated against four criteria:

  1. Allowing for direct citizen participation in decision-making
  2. Promoting decision-makers' accountability to citizen
  3. Political feasibility
  4. Technical capacity required for implementation of policy alternative

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             Global Initiatives

The Publish What You Pay campaign aims to help citizen of resource-rich developing countries hold their governments accountable for the management of revenues from the oil, gas and other mining industries.
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Revenue Watch  works with civil society, media and policy makers in resource-dependent countries to counter the effects of the so-called "resource curse".
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The Extractive Industries Transparency Initiative (EITI) supports improved governance in resource-rich countries through the verification and full publication of company payments and government revenues from oil, gas, and mining.
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