The US pledged yesterday to participate in the Extractive Industries Transparency Initiative (EITI), becoming the second G8 country - behind Norway - to join.
President Obama said it would ensure that "taxpayers receive every dollar they are due from the extraction of natural resources."
The US joins more than 35 countries, mainly from developing nations in the initiative, in what is essentially an exercise in transparent book balancing designed to highlight financial discrepancies and corruption in the sector.
The theory is that governments disclose all payments received from oil, gas and mining companies, and these companies disclose payments made to governments. Anyone interested can then check to see if the two accounts match.
Defending the decision not to commit to the EITI, a government spokesman said: “The UK is already a strong international supporter of the EITI and transparency in the extractives sector.
“We do not feel it is appropriate for the UK to implement the EITI. The UK is not defined as a “resource rich” country by the International Monetary Fund."
Joseph Williams of Publish What You Pay, an organisation that believes wealth generated by oil, gas and mining industries can be a pathway to poverty reduction, stable economic growth and development in resource rich countries, said: “This is a bogus argument which smacks of double standards.
"Plenty of EITI implementing countries are not considered resource rich by the IMF such as Madagascar, Niger, and Tanzania. The British government supported these countries joining EITI so why are they holding themself to a different standard?
"It's also worth mentioning that the UK is the EU's largest oil producer and the second largest natural gas producer."
Proof of the EITI's efficiency came in 2009 when a report on Nigeria’s oil and gas revenues showed financial discrepancies and outstanding payments totalling over US$5bn for revenues generated by the sector in 2005.”
EITI is designed as a domestic solution to corruption and financial discrepancies between government and the extraction industries.
On an international level, last year's Dodd-Frank Act in the United States and forthcoming EU rules will ensure that companies disclose the payments they make to foreign countries which are not likely to sign up to EITI any time soon, such as Angola, Burma, Cambodia and Uganda.