The EITI Board agreed the outcome of Honduras's targeted assessment and reaffirmed its temporary suspension

Board decision

Following a review of Requirement 1 in Honduras in accordance with Article 8.a of Section 4 of the 2019 EITI Standard and Board Decision 2022-32, the Board finds that Honduras has achieved ‘mostly met’ on Requirements 1.2 on industry engagement and ‘partly met’ on Requirements 1.1, 1.3, 1.4 and 1.5 on government and civil society engagement, multi-stakeholder oversight and work planning.

The Board commends the renewed commitment of the Government of Honduras to reinvigorate EITI implementation in the country, as expressed in its official letter to the EITI Chair of 31 October 2023. The government should ensure sustained commitment to EITI both at the political and operational level. The Board welcomes that industry and civil society stakeholders continue to see value in implementing the EITI and that a broader range of priorities has been identified by all stakeholders for the future focus of the EITI. To strengthen implementation and to facilitate a more impactful multi-stakeholder oversight of the extractive industries in Honduras, the Board recommends that the Government of Honduras reviews the formal arrangements for the multi-stakeholder group with the aim of ensuring all three constituencies' full, active and effective participation in all aspects of the EITI process. A work plan should be developed through wide consultations with the broader constituencies to ensure alignment of the objectives for EITI implementation with national priorities of all three constituencies.

While recognising that the EITI continues to create a space for civil society participation in natural resource governance in Honduras, the Board also expresses concern that the engagement of the wider civil society in public debate about extractive industry governance has remained limited since the previous Validation. The recurrence of violent threats to local activists and environmental defenders continues to affect public debate about extractive industry governance and erode trust in public institutions’ ability to effectively govern the extractive industries. The Board recommends that Honduras continue to use the EITI process to monitor and address any allegations of constraints on public debate and monitoring of the management of natural resources, and ensure civil society’s ability to meaningfully engage in public debate on extractive industry governance in accordance with the EITI protocol: Participation of civil society.

The Board has determined that Honduras will have until a next Validation commencing on 1 July 2024 to carry out corrective actions regarding Government engagement (Requirement 1.1), Industry engagement (Requirement 1.2), Civil society engagement (Requirement 1.3), MSG governance (Requirement 1.4), and Work plan (Requirement 1.5) as well as other corrective actions from Honduras’s last Validation in 2020. Failure to demonstrate progress on Stakeholder engagement, Transparency or Outcomes and impact in the next Validation will result in delisting in accordance with Article 6 of the EITI Standard. In accordance with the EITI Standard, Honduras may request an extension of this timeframe or request that Validation commences earlier than scheduled.

Corrective actions and strategic recommendations

The EITI Board agreed the following corrective actions to be undertaken by Honduras. Progress in addressing these corrective actions will be assessed in the next Validation commencing on 1 July 2024:

1. In accordance with Requirement 1.1 (a), following the letter from the Secretary of Transparency Jaime Turcios of 31 October 2023 to the EITI Board, the Government must make public its commitment to implement the EITI, including the designation of the EITI Champion. In following this requirement, the government should ensure that the updated formal decree that updates the legal framework for EITI Implementation is enacted. This decree should update participation of stakeholders involved and relevant for government, industry, and civil society constituencies and should be published before the commencement of the next Validation.
   In accordance with Requirement 1.1 (b), the government should ensure that the national secretariat is properly staffed to support progress in addressing EITI Requirements, including the corrective actions from the last validation and the corrective actions from this assessment.
   In accordance with Requirement 1.1 (c), the government should deliver the necessary operational support to ensure that a 2021-2022 EITI Report is published before the commencement of the new Validation. The government should demonstrate that the EITI Report includes a new set of key areas and priorities that are relevant for all constituencies at the MSG. The government should also demonstrate that the EITI Report has been used to inform public debate and policies. The Ministry of Transparency should liaise with the mining authority and the Chief of Staff of the Presidency to guarantee that enough resources for preparing the EITI Report will be allocated and that government agencies facilitate the disclosure of information.
   In accordance with Requirement 1.1 (d), the government should ensure it is fully, actively, and effectively engaged in the EITI process by ensuring that senior officials from all interested stakeholders in the government constituency are represented and engaged in the MSG. This should include the full participation of relevant government agencies for EITI-Honduras. In fulfilling this requirement, the government must ensure the participation of an inclusive and diverse group of government representatives at the MSG.
2. In accordance with Requirement 1.2 (a), the industry constituency should fully, actively and effectively participate in all aspects of the EITI process, particularly in the elaboration of the EITI-Honduras work plan to ensure their priorities are adequately reflected. As the government is planning to refresh the legal framework for the EITI and the composition of the multi-stakeholder group in the coming months, the industry constituency should engage with the government to ensure that the industry constituency represents effectively companies from all sectors of the industry, including oil and gas companies, small scale miners and other extractive sectors such as forestry, as applicable to the Honduran context. The industry constituency is encouraged to coordinate with the government to provide adequate input to the EITI legal framework and ensure that extractive sector companies are adequately represented.
   In accordance with Requirement 1.2 (a), the industry constituency should discuss implementation bottlenecks as well as agree their priorities for EITI implementation during the process of preparing for the reconstitution of the MSG and establishing of a work plan for the next years. This exercise could draw on the early discussions on the current relevant issues for the industry, including but not limited to mining policy, licensing, regulatory framework and environmental information.
   In accordance with Requirement 1.2(b), the government should foster an environment conducive to company participation. To meet this Requirement, the government is expected to actively collaborate with companies in the identification, discussion, and evaluation of any legal, regulatory, or administrative barriers that could impede company engagement in the EITI process.
3. In accordance with Requirement 1.3 (b) and with the EITI protocol: Participation of civil society, the civil society constituency should engage with the government to ensure effective representations of CSOs engaged in the extractive sector during the process of refreshing the legal framework for the EITI and the composition of the multi-stakeholder group in the coming months. The civil society constituency must coordinate with the government to provide adequate input to the EITI legal framework and ensure that civil society is adequately represented. Civil society representation should be diverse and consider gender balance. The civil society constituency must work with the government to identify possible pathways to improve the legal environment to make civil space conducive to CSOs' participation. In this process, the government must ensure that there are no obstacles to civil society participation in the EITI process and a diverse range of civil society organizations are represented and engaged.
   In accordance with Requirement 1.3 (a) and the civil Society Protocol, Honduras should demonstrate that civil society is fully, actively, and effectively engaged in the EITI process. To achieve this, civil society should clarify its internal procedures and objectives related to the EITI. In preparing for the reconstitution of the MSG and establishing of a work plan for the next years, the civil society constituency is strongly encouraged to discuss and agree their priorities for EITI implementation. This exercise could draw on the early discussions on the current relevant issues for civil society, including but not limited to, mining policy, licensing and free and prior consultation, mining and fiscal regulatory framework, environmental impact and monitoring of civic space.
   In accordance to Requirement 1.3 (b) and with the EITI protocol: Participation of civil society, the MSG should monitor the adherence to the civil society protocol, ensuring that the revised work plan includes actions to monitor and document shortcomings and activities undertaken to correct them. The Government should work with the civil society constituency to guarantee that civil society is able to express their opinions without repercussions.
4. In accordance with Requirement 1.4 (a), each constituency must ensure to have clear governance rules specifying their representatives, roles, and responsibilities. In fulfilling this requirement, each constituency should coordinate with their wider groups to ensure diversified and balanced representation at the MSG.
   In accordance with Requirement 1.4 (b) the government should renew the legal framework for the MSG including a refreshed representation from all three constituencies. While renewing the MSG, all three constituencies should review their internal governance rules and procedures and ensure adequate representation of key stakeholders including senior government officials. In strengthening internal governance, the rules and procedures must ensure inclusive decision-making throughout EITI implementation. In fulfilling this requirement, each constituency should coordinate with their wider groups to ensure diversified and balanced representation in the MSG. In renewing the MSG, the government must ensure that adequate support is provided to ensure the MSG could discharge its obligations including liaising with constituencies, capacity to carry out duties, disseminate information from the EITI process, work planning and maintaining proper records.
5. In accordance with Requirement 1.5, Honduras must agree upon and publish a fully costed work plan that aligns with the reporting and Validation deadlines established by the EITI Board. This work plan should also be linked to the EITI Principles and reflect national priorities for the extractive industries. In fulfilling this requirement, Honduras could consider incorporating activities related to thematic areas such as energy transition, licensing, artisanal and small-scale mining, the UN Escazú Agreement, the forestry sector.

Background

In October 2020, the EITI Board agreed that Honduras had made “meaningful progress” in implementing the 2016 EITI Standard. The next Validation of Honduras was scheduled to commence on 23 July 2021. In December 2020 and October 2022, the EITI Board agreed revisions to the Validation schedule. In June 2023, the Board did not approve the Honduras EITI MSG’s request for an extension to Validation deadlines and mandated a targeted assessment be conducted focusing on Requirement 1 and starting in August 2023. Honduras’s next Validation, its first under the 2019 EITI Standard, is to be scheduled once this targeted assessment is completed.

The International Secretariat’s Validation team prepared a targeted assessment following procedures that mirror the Validation procedure and Validation Guide. Stakeholder consultations were undertaken in person on 27-31 August 2023. The International Secretariat finalised the assessment on 3 November 2023. The Validation Committee recommends to the EITI Board that it does not reflect the score of this targeted assessment in Honduras’s Validation scorecard, but rather fold it into the next Validation of Honduras commencing on 1 July 2024.