Exclusive study dedicated to corruption risks in commodity trading

15. June 2017

Despite high corruption risks, sales of State-owned resources have until recently received little attention in the academic literature or in political debates around the resource curse. A Public Eye exclusive study released today by the Norwegian anti-corruption center U4 offers for the first time a typology of corruption risks associated with commodity trading and existing measures to tackle them.

Between 2011 and 2013, sales of government oil from the ten biggest producers in sub-Saharan Africa accounted for 56% of these countries’ total public revenues. Despite their importance, however, such sales remain unknown and opaque. Corruption risks associated with this phase of the commodity value chain are high due to the volumes of the financial transactions, the high degree of interaction with public authorities, the opacity of both the sales themselves and the actors involved, and a lack of regulation. Several case examples show that these risks are not merely theoretical.

This new study released by the renowned Think Tank U4 summarises the state of research on this subject, paying special attention to buyers, whose responsibilities have been little discussed. Based on concrete cases, it offers a typology of corruption risks in first sale trades of oil and minerals, and analyses existing measures to tackle them.

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