INTERNATIONAL MONETARY FUND WORLD BANK GROUP

2018 ANNUAL MEETINGS

CIVIL SOCIETY POLICY FORUM

FIGHTING CORRUPTION IN THE EXTRACTIVE AND NATURAL RESOURCES SECTOR

Jakarta B, BICC Bali, Indonesia

Friday, October 12, 2018

4:00 p.m.

LIST OF PARTICIPANTS

MARYATI ABDULLAH National Coordinator, Publish What You Pay Indonesia

LAODE MUHAMMAD SYARIF Commissioner, Anti-Corruption Commission, Indonesia

DADANG TRISASONGKO Secretary General, Transparency International Indonesia

EMANUEL BRIA Indonesia Country Manager, Natural Resource Governance Institute

SIMON CLYDESDALE Extractive Industries Campaign Leader, Global Witness

* * * * *

FIGHTING CORRUPTION IN THE EXTRACTIVE AND NATURAL RESOURCES SECTOR (4:00 p.m.)

RISKI: Good afternoon, ladies and gentlemen. Welcome to the session of Fighting Corruption in the Extractive and Nature Resources Sector hosted by Publish What You Pay Indonesia along with NRGI, Transparency International-Indonesia, Global Witness.

The issue of corruption in the extractive and natural resource sector is really a huge issue. Well, (Inaudible) growth in the sector will enable the countries, including Indonesia to finance meaningful development agenda. Anticorruption movement in the sector has been particularly growing, but the challenge persists. This panel will showcase the existing efforts, along with their impact, furthering a better collaborative strategy.

It's also expected to exemplify country's effective practices in tackling corruption and also stimulate debate underneath to scale it up into a systemic policy reform. Without further ado, I'll invite our moderator, Ms. Maryati Abdullah, the National Coordinator for Publish What You Pay Indonesia to lead the session for this afternoon. Ms. Maryati Abdullah, the stage is yours. Thank you.

MS. ABDULLAH: Thank You, Riski (phonetic). Ladies and gentlemen, thank you for your coming this afternoon. Let me please invite our four speaker in this forum. First, Mr. Laode Muhammad Syarif. Let's give applause.

(Applause)

MS. ABDULLAH: He's Commissioner of Anti- Corruption Commission. We call it KPK in Indonesia. And he also in-charge in the mostly last five years in terms of the Natural Resource Coordination and Supervision in Indonesia, particularly in the sector of extractive industry and natural resources.

Secondly, we have Mr. Dadang Trisasongko. He is

Secretary General of Transparency International Indonesia, where Transparency International Indonesia have chosen MACRA to assess the risks of corruption in the licensing of mining sector. Give applause.

(Applause)

MS. ABDULLAH: The third speaker, we will have Simon. One of the oil and gas campaigner from Global Witness. Maybe all of us know Global Witness has many investigative and also research in terms of the corruption, particularly interjurisdiction country.

And last but not least speaker is Mr. Emanuel Bria. Mr. Emmanuel Bria is Country Manager of Natural Resource Governance Institute where NRGI has many expertise and also provide technical assistance to improve transparency and anti-corruption effort in natural resources sector.

So we have four speaker now. As I wanted to reemphasize that our forum today we will discuss more on the many angle of the effort to tackling anti-corruption in the mining sector, oil and gas and also other natural resources sector. Even though from the preventive side, from the improving policy side in along the extractive industry failure chains and also from the law enforcement body sides, because we have anti-corruption commissions and we also wanted to emphasize how the important to tackling corruptions in extractive industry, because in many natural resources rich country they are dependence on the natural resource as part of the resource mobilization to finance their development, also to tackling inequality and poverty in many countries, but we see there are many problems in terms of lack of transparency, lack of governance and also anti-corruption and this would be herald (phonetic) as the people like in terms of the natural resources.

Secondly, in many country on dependent on oil and gas, mining in natural resources facing a high risk on the dependent their national fiscal in terms on the natural resources, and also to some extent on the fossil fuel sector. So that's why this anti-corruption issue is

very important. And I know and we know, IMF and the World Bank put the anti-corruption as the new critical issue. As we know also in the spring meeting this April, IMF launched the report on the anti-corruption, think to improve the governance and also macroeconomic of a fiscal structure.

So I didn't want to be taken very long. I want you to give time for Mr. Laode Syarif to highlight some issue and also presentation. Mr. Laode, please.

MR. SYARIF: Thank you very much, moderators. And ladies and gentlemen, good afternoon. Yes, they asked me actually to talk about addressing corruption on natural resources exploitations in Indonesia and things the KPK actually have some program on how to tackle natural resources related corruptions. But I think we are still in the beginning. We need to scale it up. But before that I'll try for the audience that not familiar with the KPK, I'd like to explain a little bit of KPK, what we are doing and also I always love this.

This is actually about 350 years before Christ and this is impossible for one dealing with the government funds not to taste at least a little bit of the king world. So -- but in the case of Indonesia or in many countries they do not only taste a little bit but I think big chunk of it. So this is not the case in Indonesia, so that's why I always said as the opening of mine.

So basically we never change since Kautilya time. And even actually Bu Hatta, the Indonesians -- the first Indonesian Vice President said do not let corruption become part of Indonesia culture. He said it in '61. But I think now it has become -- I will not admit it that corruption has become a part of Indonesian culture, but I think if you check it correctly maybe yes, unfortunately.

Yes, so this is the KPK. KPK is independent from the judiciary and the legislatures. We are responsible only to the public, financially audited by the Indonesian Supreme Audit Board. It is established in 2003 and it is actually led by five commissioners, collective collegial and I am one of them. But in the prosecution

side we only have -- I have to change it about 300 now, it is not 250 but about 300 investigators and prosecutors. And what is actually KPK duties and functions. Based on the KPK law, we do coordination with government agencies, including with civil society. We supervise other law enforcement agency that look after corruption like, Attorney General Office and the police. Also we are monitoring government's policies and we do preventions of corruptions, and last one, this make us a little bit famous little bit because we do pre-investigation, investigation and prosecution in one roof, which is actually bit different from like ICAC in Hong Kong or CPIB in Singapore or Malaysian Anti-corruption Commission in Malaysia. We are similar with, say, SFO, Serious Fraud Office in UK, because we investigate and prosecute in one roof.

Natural resources corruption is one of the main focus of the KPK, why, simply because there are a lot of money in it, and to be honest one of the worst governance this natural resources, compared to some other industry. And I give you an example. But then if you look at the map of Indonesian, we are quite rich actually, if you look at its natural resources. You name it, we have it. Gold, yeah, one of the biggest. Coal, we're quite rich and also the coal resources, but basically they are become actually -- if you look at oil and gas, we used to be an exporter, but now we are importers. So this is also a good sign that actually oil and natural resources, it is not unlimited. It is very, very limited, yeah, because Indonesia used to be part of OPEC and now we are importers, net importers and actually killing our economy.

I think this is to not today importance, but what is actually corruption in natural resources. There are many. For example, preventing state losses in Indonesian forestry sectors. I work on this report before I join the KPK actually. I used to assist the KPK in the past, but it is quite interesting to see. If you look at the estimated actual timber production from natural forest 2003-2014, you can actually see it. The reported production it is actually on red. We actually the estimation one, it's mentioned, we saw commercial value and reported timber production is much, much better --

much bigger, but it is unreported, mostly illegal, some of them half illegal. Why I said they half illegal, they have a license but actually they cut more than they supposed to cut. They actually cut inside natural forests for examples. So that's why we are actually -- the KPK actually launched Gerakan Nasional Penyelelamatan Sumber Daya Alam, a national movement to save Indonesian natural resources and one of them actually on mining.

This is the set reality of our finding. 90% of licenses holder do not report their mining activities. This is a real finding. That's why I'm saying, it's one of the worst. 90% licensing holder do not pay the obligatory reclamation and post-mining rehabilitation fund. About 2,000 license holder do not have a tax file number. I mean, how can you operate it within a country. Some of these licensing holder are operating within more than 6 million hectares of conservation and protected areas. So they're overlapping 6 million hectares. How big is Singapore? Less than a million. I mean the whole Singapore, yeah.

The amount of uncollected nontax revenue in mining sectors has reached about $2 billion. I spoke with the Ministry of Finance, just like what already, yes, about two years ago. I think we don't need actually tax holiday, because I mean -- tax amnesty, because actually if you just collect that but some of them it is already run away from Indonesia.

Yeah, this only a few. And so our natural resources has become the curse to the nations. And this picture actually from my own kampung, from my own village in Southeast Sulawesi where they’re mining copper. So we are trying, on the prosecution side we are trying actually a hybrid approach in prosecution, in corruption in relations to natural resources, we use anti-corruption act, money laundering act, environmental act, forestry act, mining act, et cetera. So we actually used a hybrid kind of.

Yes, so we are quite successful. I don't really think it is very successful. For example we actually sent to jail is one of the governors where actually he --

actually issued a legal permit for about more than 1 million hector for oil palm plantation in East Kalimantan, but at that time the KPK just actually started learning, so they sent him only 4 years in jail and they find it is very, very small. And this is the one who gave actually concessions. He received -- he actually asking -- actually applying a concession for palm oil, but what he did is actually just take all the wood after (inaudible), because if he applied for palm oil concession for logging that he has to do selected cutting and everything. It is only mature tree that can actually cut. It has to be managed as logging concessions. So the way he did it this actually just apply for plantation and cut everything's after take the wood, just leave it bare.

And only 18 months in jail, so it is -- but it doesn't matter, so it was 2005 we just actually started how to prosecute corruption in relation to it, but he pay little bit high fine, which is a state restitution $4.6 million and thank Waseem Jafar (phonetic) who is actually (inaudible) in Palawan Riau (phonetic), yes, this one's quite good one, send him to jail for 11.5 years. And we have like a three governors of Riau, two of them actually in relation to natural resources exploitations, issuing illegal licenses, 14 years in jail and another one is issuing illegal licenses for seven years in jail and fines, and but some of those corporation actually still operating. This is my next move.

I forgot, I suppose not to say this. That's what is of the record if that is (inaudible), sorry. And this is also the Elsetors (phonetic). He established actually 80,000 hectares palm oil plantation on state forest in North Sumatra. And the Supreme Court already decided that particular plantation has to be taken for state, but until today that plantation still managed by his family. I mean -- yeah, and he's already pass away, he is in heavven, but yeah, I mean how come, and I keep saying to them several minister, who's supposed to do it, they cannot even do it until today, until today.

And this is Hartati Muldayar (phonetic). Actually -- he's actually (inaudible) also to just establish. This is one of the richest lady, is maybe

around, because I also see several high-ranking officials former, I saw Miranda Gol (phonetic) turnaround, yeah, yeah, and many others, but maybe she is around, she is still very rich. And also the last one is governors of my own province. Actually send her to jail 12 years for issuing illegal mining permit and anymore to come at.

The actors involving various several government officials, member of parliament, private sectors, the modus operandi is not something difficult. It just basically it is bribery illicit enrichment, but some of them are getting clever. They do all transaction outside Indonesia, so it is make my life very, very difficult.

And if you look at the impact of corruption on the environments, yeah, the environment destroyed for short gain. This is actually -- this is national park. This is call it Gunumbatak (Phonetic) in Maluku, but look at that, and those mining -- illegal mining actually guarded by many high-ranking military officers. And this is in my province, illegal but still operative.

I love this news. This is one of the head of provincial forest department say, it is difficult to detect illegal mining. That's what he said. I mean this big operation it is difficult to detect, come on. I mean if you are actually concealing a weapon or concealing some marijuana in your pocket maybe is difficult to detect. This is a big operation. And he said it is difficult to detect. And the flood has become a new normal in that province because of this. No post-mining rehabilitation fund in Southeast Warasi (phonetic), so this is my own -- my own provinces. And the impact of corruption on environment and human right is huge.

Look at that, I think I put this number because this is actually the World Bank report, so which is actually a gap between (inaudible) it's 1% control, more than 50% of Indonesian economy. I look at that, thanks god we are number three and not number one like Russia. I mean, yeah, yeah, I mean -- and the Indonesian has much higher rate of stunting than most other countries in the region. I cannot believe this. We are actually -- it's worse than Myanmar, yes, but this is the same report,

actually World Bank report.

The gap between richest and poorest countries. While the Indonesian government says, this elementary school and junior high school, it's actually free they can go to schools for free and the 20% based on the constitution for the Indonesian governed money has to go for education, but still look at that. And the mercury (phonetic) victim of illegal mining are everywhere.

Yeah, of course based on that we had to do coordination professional child (phonetic) resources, we do national movement in (inaudible) resources and on forestry, plantation, marine fisheries, mining, oil and gas and energy et cetera, but I would say this is just the beginning and I think we need more -- a lot of prosecution, because I come to the point where they call it a capacity building and talk nicely with others not working at all, because my previous life, 15 20 years I've been doing that, those things, talking to people, messaging them, but it's never happened. So that’s actually -- but of course we cannot tell you lost hope, so that's why we try to work with many other people, including say for society or relevant government's department, et cetera, including international communities just like the one we actually have in today.

And the corruption preference and a collective effort, we inform central government, local government, law enforcement agencies, and of course this one, we are now in the process of evaluating it. It is already finished just last week, because this is actually signed by the president at that time, including the Commander in Chief for the Indonesian military. But I saw this when I teach it Sydney Uni, a few years ago, and one of my student actually asked me, what is the relevant of Commander in Chief of the military actually doing this. And I say, yeah, because you don't know Indonesian (inaudible).

I mean, yeah it is what, yeah. So that's why this is also difficult to do on marine, et cetera and addressing this one, the last point that I want to make.

So we asked bit in the Indonesian finance intelligence unit, we actually trying to persuade the governments actually to come up with addressing Indonesian beneficial owners regulations. Now we have a government regulation -- presidential regulation on beneficial owners, so we can actually have the name who actually owned those big companies. Definition of Presidential Regulation 13, I don't read those things, but I want to say is that look at this, based on the public accounts debt of Indonesia there are 73 cases of money-laundering using corporation with value of 4.5 trillion and some of them -- many of them actually are natural resources.

In 2015 we detect more than 5,000 suspicious transactions and thus fairly around I don't know how much in U.S. dollars it is about more than -- it is trillions. I'm not an economist. I'm just poor lawyers. I'm not really good with numbers. Yeah, benefit -- so we can actually -- the valuation of Gerakan Nasional Natural Resources Movements (phonetic), we can actually now doing it and we have several goals and, yes, those kind of things, but I would like to thanks, I've been talked too much if you want some detail then you can actually ask me. Thank you.

MS. ABDULLAH: Thank you Mr. Laode, very interesting on how commitment of Anti-corruption Commission. I just wanted to emphasize you again, if you wanted to take a presentation from this forum, please put your name card in front of them, so we can e-mail some of the materials. So next I wanted to know from the Simon's on how the global practice of corruptions in the oil and gas and perhaps mining. Please, Simon.

MR. CLYDESDALE: Thank you. And I'm glad to hear this is off the record, because I'm about to tell you about ongoing and potential court cases.

MS. ABDULLAH: Sorry, I just wanted to say that do you want to off the record?

MR. CLYDESDALE: No, I was joking.

MS. ABDULLAH: No, we have live streaming.

MR. CLYDESDALE: Whenever I say it's off the record, I can't trust that it's going off the record, but it was lovely to hear that we have a warm environment where maybe we can begin to think that might be off the record.

SPEAKER: (Inaudible).

MR. CLYDESDALE: It was very heartening to see so many prosecutions there. I can't begin to tell you how much that warms my heart. But I'm going to talk to you also about combining the carrot that you're so sick of, of capacity building and talking nicely to people with the stick of accountability and taking people into courts and helping to set up prosecutions and making people pay the price. And so to do that maybe it might be useful if I unpack a little bit of probably one of the highest profile corruption cases going on at the moment. The global witness is heavily involved with which is the Nigerian oil deal known as OPL 245, probably one of Nigeria's most promising blocks, potentially 9 billion barrels of oil. But it's subject of a corrupt oil deal between two of the largest oil companies in the world, Shell and Eni. Eni, the state's Italian oil company. Shell, I imagine will be familiar to you as the sixth largest company in the world, U.K. and Dutch based.

To cut the long story short, what happened was the oil block in Nigeria, OPL 245, was awarded by the oil minister at the time Mr. Dan Etete to a company called Malabu. However, it was not apparent at the time that Mr. Etete was heavily engaged, invested in owning Malabu, how very convenient. What happened was that essentially the value of the block which is $1.3 billion -- $1.1 billion of that never reached the Nigerian state coffers, that money was siphoned off primarily through Malabu and Mr. Etete. And after much investigation, Global Witness made a complaint with our investigative partners in this Nigerian organization called HEDA, another U.K. organization called the Corner House, and an Italian organization called Re:Common made a complaint to the Italian prosecutor and as a result of that a case opened in Milan recently. In fact, we will be giving evidence in

that case next Wednesday.

The prosecutor alleges that $520 million went in political kickbacks, some of which were alleged to go to Goodluck Jonathan, the presidential candidate at the time and his ministers and officials, and that kickbacks went to Shell and Eni executives, $50 million in cash -- hard cash delivered to one of the Italians homes. So that case is proceeding. But I think this case can unpack a number of aspects of how corruption can occur and how we can challenge and stop corruption.

It's worth pointing out that up until a year ago Shell denied that it had any knowledge that Mr. Etete was involved or that Mr. Etete would maybe be a person we best avoiding. However, after we released our report last year to demonstrate that they knew all about Mr. Etete, they were forced into a rather embarrassing public u-turn and to admit that they knew Mr. Etete was part of the deal. Mr. Etete, I should point out is a convicted money- launderer through the French courts.

Just to give you a couple of juicy quotes from the e-mails that passed between Shell officials. And I should point out that two of the Shell executives used to work for MI6, the U.K. secrets services and not uncommon phenomenon in the oil and gas industry, whether they have two jobs is for you to judge. However, one e-mail said Etete can smell the money if at nearly 70 years old he does turn his nose up at nearly 1.2 billion he is completely certifiable, but I think he knows it's his for the taking. So this is internal dialogue at Shell. Another e-mail went on to say that the president, that's Goodluck Jonathan, President of Nigeria is motivated to see 245 close quickly, driven by expectations about the proceeds that Malabu will receive and political contributions that will flow as a consequence. So it was very clear what was going on. Shell had a clear understanding.

So it's worth also pointing out that this is part of a broader context in Nigeria where despite having huge resources, very rich in oil and gas 80% of Nigerians live on less than $2 a day. This is a poor country. And

it is estimated that something like $400 billion has been stolen out of Nigeria's oil resources in the last 50 years. And the central bank, the Governor of the Central Bank of Nigeria quit in 2014 saying that at least $20 billion had gone missing in 18 months from oil money. That takes some doing.

Now, there's a new report that I would draw to your attention that's co-published by Global Witness, Corner House, HEDA and Re:Common, the same coalition that's worked on this case that looks at the World Bank's role in investing in oil deals. This is called the World Bank red flags and the looting of Nigeria's oil revenues available from the Re:Common website at the moment.

Just briefly while we're here at the World Bank and IMF, it's worth pointing out that the International Finance Corporation, that’s the private sector investment arm (phonetic) and the World Bank's multilateral investment guarantee agency committed $325 million to Seven Energy, which is an oil and gas company in Nigeria. But before the first investment went in from these bodies the Governor of Nigeria, I previously mentioned alleged that the flagship contract involved a scheme looting billions of dollars of state revenues. So where's the due diligence. The World Bank is pumping your money into corruption, extraordinary.

So to move on, if I may, I should point out that it's no small bear. This is probably one of the largest corruption cases, corporate corruption cases in the world. We have the standing CEO and the previous CEO of Eni up for trial on aggravated international corruption charges. We have this former executive director of Shell Upstream and the two spies I mentioned and the head of Sub-Saharan exploration. So these are very senior figures.

Had we had beneficial ownership transparency that was referred to earlier, I think it's fair to say that would have been a rather deep disincentive for this deal to proceed in the way it did. It wouldn't be impossible really for Dan Etete to hide his Malabu link and his corrupt role. He could have prevented or deterred the deal happening altogether. So I don't think we can't

really underplay the importance of beneficial ownership transparency, really beneficial ownership, the veil that has existed over company ownership for so long has allowed the secrecy to be the getaway car for which people can loop the money and we're beginning to deflate the tires on the getaway car as beneficial ownership becomes pushing through legislative bodies.

It also allows us to look at peps people, politically exposed people who have links and access to these companies who have proximity to power, which is again not to be underplayed.

The spread of BO is heartening. It's now being supported by about 40 states and probably even more. And it's really rolling out becoming a global norm, but even progressive states are finding it difficult. The U.K. was a very early mover and it has a public open data beneficial ownership registry. We at Global Witness worked to do some analysis on this and as you would expect with a new thing it wasn't perfect. There were people in there who were dead, as company owners there were babies owning companies, days of rubbish in rubbish out. But we're working with them to help make this a robust and transparent process that has some meaning. We did find that nearly 8,000 companies were on that first register who had links to beneficial owners, officers or post codes that were shared with companies who are suspected of dealing in money laundering. So we're already getting very valuable results.

The UK's next step has been to declare that it will have beneficial ownership registers in its overseas territories. Essentially a whole series of tax havens, that as you can imagine has not being universally popular because well that's how the getaway car works. And we need a global movement. There's no use the U.K. government for instance doing this on its own, because you're just going to be displacing assets and dirty money and you're hitting a mole on the heads and it's going to pop up in another hole. Moving in one jurisdiction to another, but I'll come back to that.

Should point out that beneficial ownership is

now mandatory in the EITI, the Extractive Industries Transparency Initiative, which is a voluntary initiative, but it is taking place in 51 countries around the world, and in many important places. It's very difficult in some areas though to implement beneficial ownership. I was in Myanmar, Burma recently, and there are deep vested interests there with the state-owned enterprises where there are military and ex-military directly engaged in taking the money out of those enterprises.

The CSOs there are very exposed, but they're very brave, they're very committed. They put their lives on the line to make sure that the money from jade and the oil and gas revenue is brought back to the people to bring them out of poverty and change the country for the better, rather than disappear into people's pockets over the border into China, and that's what this is all about. I mean the impacts in country are sadly quantifiable.

The $1.1 billion that was stolen out of the Nigerian deal that was enough to -- were more than enough to pay for Nigeria's health budget in 2016 and one and a half times the amount needed to deal with the famine that was going on in that country at the time, and that's for me what this is about. These are not victimless crimes. This isn't a white-collar crime. It's costing lives. It's depressing well-being and impeding progress. And that's what this money should be used for.

I should maybe talk a little bit about SOEs if I can, state-owned enterprises. They are a particularly risky area because we have proximity to government and officials intrinsically and access to vast resources. So that can work well for governments that essentially can give them a greater take, but you can also see that the oil and gas sector, the oil, gas and mining sector I should say has the highest rates of corruption within SOEs and this is OECD data over the last 3 years. Billions are lost annually through these enterprises that are ostensibly there to help the public purse grow and to help raise well-being.

We can see this in Nigeria. This is the Nigerian National Petroleum Corporation that I mentioned

earlier in this report. In Azerbaijan Global Witness have worked there. You probably have heard the Car Wash scandal in Brazil involving Petrobras, which is a state- owned enterprise. And also in the Democratic Republic of Congo, the state mining company Gécamines. We've used EITI data there to demonstrate some pretty questionable practices by very large players like Glencore and individuals like Dan Gertler. Can't really talk much more about that because Mr. Gertler has very -- a large army of lawyers.

Talking of lawyers and gatekeepers and enablers, not all lawyers I should point out are on the dark side. We use lawyers all the time. But due diligence is important in this sector. Europe for instance has a serious money laundering problem and the banks have an important role to play. JPMorgan for instance are currently have a complaint against them from us with the Financial Conduct Authority in the U.K., basically for money laundering for the money that came out of the OPL deal. They did not do sufficient due diligence. That case may take a while. The FCA don't work in a very transparent or fast way.

But another recent example is the Danske Bank scandal. You may have heard about the Estonian branch essentially put through about $100 billion worth of very strange dirty and dubious money. Danske described this rather archaically like from a P.G. Wodehouse novel, as being concerning unacceptable and unpleasant matters. Well, that's one way of putting $100 billion stolen out of the back pockets of people. But, you know, it's not just Estonia, London is a major center of corruption. There's a lot of warm words come out of the U.K. government, tries to position itself as a global leader on transparency, but progress is slow. However, this week we have unexplained wealth orders, a new tool being used by the U.K. government and the first one was issued this week against the wife of an Azerbaijani bank official who owns an £11.5 million house in London, quite a large multiple of the declared income of her and her husband, wonder how she got that.

Auditors have a big role to play here. The big

four accountancy firms sign off accounts all the time in ways that seem highly creative. There is a new inquiry in the U.K. going on concerning that. We need fines in this area that deter, genuinely high-level fines and we need people who are made to pay the price if they have a criminal liability. For too long we have slapped people on the wrist and told them don't do that again, that's not going to wash anymore.

Another area that's important to consider is contract transparency. It's an essential area, it's a growth area, we're seeing more and more of it and there's been good recent analysis by Oxfam in this sector that's worth looking at. And this is a kind of a gray area really between legal and illegal corruption, because we shouldn't assume that all corruption is illegal and there is the acceptable limits of business practice are pushed sometimes and I think with contracts you can see that quite clearly in some oil and gas areas, OpenOil are an organization that do some excellent analysis on contracts. You can look at their recent work on Guyana for instance to see this new producer company that has signed a rotten deal with Exxon. Yeah, Exxon needs to revisit that under some pressure.

We have some forthcoming analysis on some interesting contracts that I can't speak about now, but there are some flabbergasting numbers out there. This links into payment and revenue transparency, which is at the heart of the transparency that we're looking for really. It's also at the heart of the EITI that I mentioned earlier.

Corruption happens at the project level, that's where the abuse happens. The EITI is now beginning to report payments at project level and we're seeing mandatory reporting happening through the EU transparency and accountancy directives which has been transposed into 28 different countries, seems to be 27 thanks to Brexit and into Norway and Canada. The U.S. through its own regulations up until recently torn out to pieces by Mr. Tillerson and Mr. Trump also had a regime of reporting. So these regimes catch about 80% of the top oil companies and about 60% of the top mining companies. It's vital

data. I mean this is hundreds of billions of tax payments and other public revenue flows that we're now seeing properly for the first time. Most of the time companies are still trying to clump payments together so you can't see inside the box, but this does allow analysis the revenue flows and Global Witness very recently published a new handbook, I think cutting-edge handbook for finding the missing millions and I would I would recommend you go and look at it on our website. It has ten tests for identifying red flags, where dubious payments may have happened. It'll help you as an activist or a CSO or an investigative journalist use the data. It's in French, English, coming soon in Spanish, Arabic and Russian. It helps you identify big -- where the big questions are about tax and about community benefits which are often promised but not paid or siphoned off.

I'll just finish my one other point that I think is important and that's cooperation with the law enforcement. Without our complaint it's unlikely that Shell and Eni would be in the Milan court case. We have another complaint with the Dutch authorities who have a vigorous prosecution ongoing. Well I shouldn't say prosecution, investigation from the prosecutors ongoing in the Netherlands right now. We do deep investigations into grand corruption and sometimes if we get the right evidence that can manifest through complaints, through authorities that begins to deliver accountability. We're talking to a number of jurisdictions about Shell and these cases, the OPL 245 case where there are active law enforcement cases in eight different jurisdictions on this one case alone.

The tentacles of corruption go far beyond the project often. They go into all sorts of areas. The hairs will raise in the back of your neck if I was able to tell you some of the stories that I know about the back story of OPL 245, and hopefully the case in Milan and the film and book and the TV series that must have never become of this extraordinary case will make that clear. Cross-border cooperation is essential and you need smart and well reserve because you're dealing with smart and well resourced criminals. So just to say watch this space. The case in Milan may take a year or two to

evolve, but I think it could be the beginning of turning the corner for this highly corrupt sector.

MS. ABDULLAH: Thank You, Simons. Very interesting, so we will keep after this. I already have a question. But next I wanted to hear from Mas Emanuel Bria. How do you measure and also upon have any sense the area of corruption. Please, Mas.

MR. BRIA: Okay, thank you for that. So mass louder and Simon already talked about different examples of corruption, how corruption could happen and even like more than thousands of years ago, I think maybe since the human civilization people are corrupt already, so is it something to do with culture or is it part of human nature. So I'm pushing that further.

Let me give an example like, it's people normally talk about Singapore as a country, clean, everyone is very disciplined, so if you're an Indonesian go to Singapore you basically forced to become more disciplined and clean like any Singaporeans go to. But if a Singaporean come to Batam, what's the behavior, is it the same like when they're in Singapore or the behavior will change? What I'm saying is that it's something true with human behavior. So when you're in a different system you may behave differently.

So I think it's important to step back a little bit and think about what we're actually fighting. So fighting corruption, what we are actually fighting and who actually we are fighting against. So it's important. So it's not -- it's important to think about that, so maybe we have like big powers, even like politicians, we as NRGI I have to do what is it promotion. I'm asked to do the promotions. At NRGI I actually produced a report called Corruption Risk in the Licensing and Oil Gas and the Mining Sector.

So looking at the different cases of how corruption actually happened. Like 40 case studies and actually looking at this they call it that red flags. Most of the cases happen actually because of the abuse of power, because it involves politically exposed persons,

because it involves generals, it involves officials, head of district, governors, those are actually have power to make decisions.

So if you have so much power and you have so little check, you tend to be corrupt, right. I think that's basically what I was saying at the beginning. So I think it's important that when we talk about fighting corruption we need to think about this kind of construct a little bit about the human behavior, the rules and institutions and now actually citizens are guarding against the natural resources.

Now, what I have in the presentation actually a beautiful idea that is produced by NRGI, it's called Natural Resource Charter. I mean this is like an ideal world, how actually you're managing your nation's wealth. Indonesia has (inaudible) region. Many other nations as well, but when you compare with those who are actually rich in natural resources and those countries which are not very rich in natural resources, it looks like those who are not very rich in natural sources are doing much better. So why is that, what is the problem.

We may look at examples like, people always look at Norway as a best example of managing their natural wealth or some other places like Chile. But apart from Norway or Chile look at the number of countries in Africa or in middle -- even in Asia, including Indonesia or in Latin America, these countries are still struggling to transform the natural wealth, oil, gas and mining into sustainable development, into development. Why is that? Why that remains a problem?

Now, if you look at the slides that I actually prepare here, the main work that NRGI is doing is actually helping the countries to translate that oil gas and mineral wealth into a national wealth. And doing that and, you know, so that these countries are not very much dependent on the extractive sector. They can diversify their economies. They can become more resilient toward global shocks, et cetera, and there are different ways where countries are doing that, starting from how they are actually allocating license or contracts to companies, are

actually doing that. The role of national oil companies or mining -- state-owned mining companies, are they actually contributing toward national development or they actually become a problem. Looking across the world most of the national oil companies or mining state companies have actually become a problem instead of generating value out of these resources.

The example of Brazil, I think people are actually, it's in the news of Nigeria and so many other places, right. So Brazil, people are looking at Brazil in the past as an example -- a good example of how they actually divide power between the one who actually giving out contracts and then national oil companies actually focusing on the commercial part so that you have -- you don't have a conflict of interest.

But at the end of the day you still find corruption there, and it involves high-level politicians which actually at the end of the day they actually brought down the president because of that case, right. So as Pak Laode said, if you have so much power you tend to -- you know, you want to taste a little bit of that or maybe you want to -- you tend to taste a lot of that. It's something through with human behavior. So I think it's important that when we discuss about fighting corruption in the natural resources we keep that in mind.

The second point that I'm trying to make what is so special about corruption in the natural resource sector or in oil gas and mining sector, is it different with corruption in let's say, infrastructure development sector, is it different, why is it different. Are you actually producing or generating or basically like you're making gold or are you making oil or you simply go and find oil somewhere under the ground.

So these are the things that already there. You simply have to extract, so that's why it's called extractive industry, because you simply go, extract and make money out of it. So these are given. And because it's easy money, it's easy money actually, I mean you have to invest, you still have to invest to get out of this wealth, but compared to others actually you're simply go

and find, especially the pictures that Pak Laode actually saw, the illegal mining and all this kind of stuff like I can even go and get some gold and sell it to the black market and I get some money. So it's so easy.

Now, the problem with that is that you don’t -- there is no incentive, because you simply go and get the money out of it. There is no incentive for you to actually demand for better kind of institutions, right. You don't have to pay your taxes. So in countries that actually have more braveness coming from oil, gas and mining sector, like in most of the countries in the Middle East, there is less accountability, because citizens don't feel that you have to demand for the government to be accountable. It's free money. So since this is free money then I don't have an obligation to ask for the government to be transparent, accountable and making sure that money is spend well. So I think that is why managing this sector is quite unique.

Now, I have this -- the so-called political tripit (phonetic). You have rules, institutions and citizen understanding. This is the whole construct of democracy. But if you have authoritarian rule or authoritarian regime you don't need a citizen understanding, right. You simply have good rules or maybe good institutions and maybe less citizen understanding but is it possible to do that.

Now most of the problems that we find in Resource Governance Index that we produced in 2017 like in countries like Indonesia we have to some extent good rules in place.

SPEAKER: Yeah, rule is good.

MR. BRIA: The problem is enforcement and implementation, so there's a huge gap. We call it implementation gap. There's a huge gap between the rules and the practice. Why is that? Why there is a gap? So people are sometimes concentrating on making good rules. Okay, let's design a beneficial ownership regulation signed by the president, okay. We succeed. President, Joko finally signed a presidential decree on BO and then

Minister Jonan, he was so excited during our Global Beneficial Ownership Conference and after that he produced like, I think a decree or something like that around making beneficial ownership as a requirement for applying -- for companies to apply for getting licensing, good rules, right, what happened in practice.

So it's always important to keep in mind that one thing is you have good regulations and rule, the other thing is that these regulations or rules are followed. And then you'll have a strong oversight bodies like anti- corruption commission and many other oversight bodies. You have a strong judiciary to make sure that these things are followed, right. Now, if the judiciary are so corrupt, who is actually oversight to the oversight, you know, are you -- do you need like an oversight of oversight of oversight of minute, so you have different layers of oversight of oversight. Whose oversight -- who oversee again. So maybe God is the end, maybe God is the one who actually oversee everyone at the end if you believe that. So it's -- it becomes like a cycle when you don't place all these things in a one kind of.

So what I'm -- the point here is that, okay, that KPK is working very hard with civil society to fight against corruption in Indonesia bringing all this corrupt government officials to jail, but is that enough, is that enough because at the end of the day maybe it's more like we are fighting fire. So fire here, fire there we are fighting. But the institutions, the human behavior, as I said before, doesn't change then we are not going to change anything. And when it comes to human behavior, it's something to do with education, Pak Laode is, he present about the level of education, the kind of education that we have in Indonesia, and so I think it's a quite a complex issue.

Now, where is the entry point? I think the entry point is, yeah, it's up to the debate now, yeah, and how we are actually dealing with that, especially for countries like Indonesia where institutions are still weak. You have good rules, the practice is weak. The judiciary is quite weak. I think this is one of the finding from Transparency International Report, the

politicians are always corrupt like thousands of years ago and that citizens are sometimes are ignorant about what is happening. So I think it's important to bring out this to the table to discuss about that.

Now what NRGI is doing is actually all this time we have work on doing research, technical assistance and advocacy about improving the rules and improving the institutions. But now we are embarking on like, you know, researcher on real-world corruption cases just to understand how the corruption actually works and then based on that we could provide support to the government, to civil society, to the media and others, to better work on this. I end that. Thank you.

MS. ABDULLAH: Thank you. Thank you, Mas Bria. Very interesting. You mentioned many issue regarding particular institution. So next Mas Dadang Trisasongko, please maybe because we have still have 30 minutes and I hope that the floor can have a question and answer, maybe 10 minutes. Please Mas Dadang.

MR. TRISASONGKO: Thank You, Mary. I think everything already said by the previous speaker. I just want to share our picture.

Okay, this is about TII, this is not important for you. This is like mandatory, I have to display this. Every presentation I have to display to remind everybody that our scores like this, 37, and the (inaudible) if you compare with the previous year and this is the trend, I think we are in the right track in the right way so far, slowly, but we are in the right vehicle and, yeah, the government said that the next 5 years maybe the (inaudible) score will be --

SPEAKER: Eighty-seven.

MR. TRISASONGKO: Eighty-seven, yeah, hoping. You need express train I think, not becha (phonetic) -- you know becha in Indonesia and then let's see, most of the other situation. Yeah. We already have like energizer for the KPK and other law institution. This is the Supreme Court regulations. It give guidance for the

law enforcement, especially for judges to bring the corporation to the court, not only in their person but also their legal presence.

Next, we also just cut the Presidential Decree, Bria already mentioned that it's only regulation rules, lot of rules we have now. We hope that the Presidential Decree will make the (inaudible) more and more focused. One of the important things related to our discussion is on natural resources regarding to the state finance revenue and also licensing on natural resources, on extractive industry.

This is what we cut in our assessment on state- owned enterprises in Indonesia, 105 state-owned enterprises. The average score, if the best, most transparent, the score is 10. The average score is 3.2. The highest score is in anti-corruption program, they're more transparent, organizational structure. And then country by country reporting, zero. If we compare with the SOE listed and non-listed SOEs, listed SOE is better in above transparency. This is the list. We have no green color on this. Green is the best. This is the situation. Some of the big oil company in the red area, national oil company.

Regarding the anti-corruption program, sorry, still in Bahasa. The worst score, the lowest score is in training -- is investing in human, in the people. There is no anti-corruption training for every level in the company and code of conduct of the third-party. And the sub from the bellow or the bottom is the monitoring of their anti-corruption program, regular monitoring. The highest is most of the state-owned company, they have the whistleblowing system. As policy they already have. This 57% of all the SOEs in Indonesia they already have the policy.

Next. It is -- I will pass it. Yeah, it is a global figure of bribery by sector. Oil and gas and mining stable in the bottom five, the position. It mean that the bribe rate is very high.

Next. This is what TI Indonesia already

assessed, the licensing system regarding to the mining in Indonesia. This is part of our global program. This is the result. The level of corruption risks in the license system, in the mining there is no low risk. The very high risk is more than 50%. And then another figure, it is the part of the licensing chains, determination of mining area, allocation of mining area, license and permit granting. They serve almost the same percentage.

About the context. Context mean that the rulemaking process and the policymaking process indicate that it is like state capital, yeah, corrupt by the politician, private sector. This is our recommendation. In private sector and also in state-owned enterprises we have to develop and effectively implement the reliable anti-corruption safeguard. And the second one, all the company has to disclose their structure of their company, documenting all the government contribution report, tax and other payment to the government, and business association, other CSO, they have to play their crucial role to facilitate the collective action, yeah, because in our finding before that most of the company who feel the loss of the contract because their competitor bribe the public official. So we cannot address the corruption individually, but we have to establish the collaboration internally and externally.

For example, in the oil sector, I think the role of the association is very important, to promote anti- corruption internally and externally. I think they also have like the political power to push, to ask the government to reform the public sector.

This is -- okay. The last two pages is what the iGlobal (phonetic) already published. This is the 10 anti-corruption principal. This is not Ten Commandment. The 10 anti-corruption current principal for SOEs. I think this is the guidance for how to improve the governance of the state-owned enterprises. Thank you moderator. Thank you for your attention.

MS. ABDULLAH: Thank you, Mas Dadang. So time is now for floor. If you have questions -- question also or criticals. I give three. No, okay. Please one and

seconds in front of. Please mention your name.

MR. RAHMAN: My name is Ibrahim Rahman. I'm from Samura (phonetic), Indonesia. We are a logistic company, but I used to be working at United Nation University just months ago, so just moving back to Indonesia. So first of all, I feel like a little bit sad that this session is only attended by several hats, while the session about the optimism on future economic progress saying Indonesia will be progressing 5.3% in the next 3 years are attended by hundreds people. So it should be just the other side of the coin that the cost of growth is probably hampering natural resources like Pak Laode has explained. So 5.3% is on the one side of coin, where the other side of coin is all corruptions, as the cost to run the economy. So -- and we had also quite similar calculation back then at United Nations that we Indonesia -- well, no we -- we were not calculating but based on the study by the World Bank as well the size of the shadow economy was about 27% of GDP. So it's exactly the same as you say it, like this country actually doesn't need whatever tax amnesty program if we can optimize the potential economy within the country to fulfilling all better governance and so. Reducing corruption level, better governance and an all related aspect to that. So I want to be quick in my question. So what makes this so difficult, especially in the corruption, in natural sources. You didn't touch anything about political aspect, which I think it might be related to that like this is done by somebody, who has close connection with somebody in the power, so that's very difficult for KPK to do -- yeah, to prosecute for instance. So why is it so difficult and especially and what would be your projection in next future? Can we tackle this problem in better way? So thank you very much.

MS. ABDULLAH: Yeah, thank you. Next?

NATALIA: My name is Natalia from Transparency (phonetic). You know, this is a very depressing session I must say, but I was encouraged what Simon is doing in the stake. But even with all this, with all the shaming of these companies and the naming of all these peps, it just doesn't seem to deter anybody. So what more needs to be

done, because Transparency International, we analyze the problems, we offer recommendations, we work together with governments and still it's not enough. Global Witness does a sanctioning. We do moral sanctioning, social sanctioning, legal sanctioning, and still it's not enough. So what can we do at the global level, at the national level perhaps to make people really aware of the dire consequences of this kind of corruption, grand corruption? Thank you.

MS. ABDULLAH: Thank you. Anyone again? If not, maybe I will have a brainstorming question and also I wanted to ask the answer in also closing. My question for Pak Laode. You mentioned about law enforcement efforts, so how -- and also Pak Laode and also Simon say this, there are many international and global cooperation, how do you think KPK also thinking this is bringing for the global collaboration as well. And for Simon, you mentioned also the report from the World Bank, they give lending for the extractive industry sectors and others. Is it enough or there are loopholes on the safeguard provided by IMF or World Bank to tackling anti-corruption in this and also governance in these sectors? And how do you think beneficial ownership global collaboration would be effective among north and south country in terms of this.

Mas Bria, one question, also you mentioned before about institution political and also you say about taxation. We are more than 3 days, we're talking about taxation, how do you -- your opinion about the progressive taxation in this natural resources, because many SDGs discussion talking about this, mention about it.

And also Mas Dadang, how do you think the effective collaboration on the collective actions among actors, civil society, private sectors and also governments to tackling this.

My first for Pak Laode, please, and also answer the question.

MR. SYARIF: Thank you very much. I want to answer the first question. What make it difficult

actually to tackle this corruption in extractive industry, especially on mining and stuff. Yeah, it is very, very difficult because in terms of the actors, for example, they are doing it kind of legally. So for example, the size of mining license in Southeast Sulawesi, this is legal one, and in the eastern part of Kalimantan, it is bigger than the size of the land. But in the past the Philippine actually experience the same things, not only Indonesia.

But I mean -- yeah, so everybody giving a new license. And usually it is true that actually it is connected with political actors. This is a time when actually the new cycle -- close to the new cycle of provincial governors election for example or the Bupatis, which is actually head of the district or even in national level, usually actually they give licenses to ruling parties. When I'm saying ruling parties, it's not political party, but that's ruling -- people who actually rule the have powers to do it. For example, I'll give a - - I do not want to mention the name. I have to be careful now because this is actually broadcasted. For example, one minister for example, before he actually finished his term as a minister, he gave concessions almost like 1.5 million hectares of lands. I mean this is big land, but is it corruptions, not really corruptions, because, yeah, he has the power to do it.

Secondly, is he getting money from someone to give, to change the status of the forest, maybe or maybe not. Proving it, it is painful, it is very difficult. But it is actually easy if you enforce the existing law, the mining law, the forestry law or the --

SPEAKER: Plantation.

MR. SYARIF: Yeah, plantation law, because it is very easy. But since they are also, sorry, corrupt and so they actually just leave it, while us as the Corruption Eradication Commission we have to prove beyond doubt that actually taking something, and it is always very, very difficult.

Of course, we can actually trust a bank account,

but usually they never actually use their own name. Based on the experience of the KPK usually they use puppet company. For example, actually list its not. For example, have you heard about Mauritius? Yes, we knew that small tiny island, but I never plan actually to go there in the past, but since I work in the KPK because one of the money actually put it there, I have -- I went there and I have a special connection with the anti-corruption agencies there. But, I mean, they know how to play with the system and so it is make it difficult, that's second.

Emanuel just say, is it different corruption in, for example, natural resources extractions and big infrastructure for example. Yes very, very different. For example, if you want to build a road the state budget is actually clear. This is 3 billion and you can actually check it, whether these 3 billion equivalents to the bridge that's actually built here. But if you're talking about gas and oil, you don't know how much oil there to extract from below the surface, only very limited people. And usually our governments they don't know. So it is they just depend on the report from the company.

So when I ask the governors of Riau, do you know how much barrel of gas you extract from Riau a day? He told me that I don't know sir, because I do not have a password to the system. Because I told him, yeah, but the Minister of Energy actually they have a system now. You can actually check it. Not daily, minute per minute. And say they never give me a password. So it was Director General, actually President, I say, why don't you just give the password of it. So he knew he can actually plan how much tax that is particular company, which is actually Shell I just mentioned, no, several actually operating. Then he said okay, we will give him sir. It is just -- I mean, this is very difficult especially on gas and mining. And suddenly Pajurno (phonetic) actually came to KPK and say they have a special project to put metals on the pipe of the gas and many others so we will know how much actually oil and gas is actually extracted and how you are going to do it and we will actually put special devices, put it on the pipe. When we check it, it doesn't work. So we already have the project, which is actually based under good faith but again it's not working. If they want

to put special device, they have to stop the flow and they had to put inside the pipe they say. It will actually change the flow of the gas and oil. So it is very technical and very difficult and I don't really think my investigators knew it, those kind of very technical thing. But it's -- the more -- and usually it is not actually -- it is not close to the city. They're in the middle of the jungles or in the middle of the big ocean, so only them knows. For example, given an example, okay -- no, I hate this with direct broadcasting things. I cannot say things, and I mean -- but, yeah, there are people actually doing it. They are investing in one particular big area. They say this is have a big potential. The price supposed to be 10,000 and they say, no, because this is very big potential, maybe 50,000. So the Indonesian guy investing on it when they check it actually even less than 5,000.

I think you know what I mean, because you guys actually working on this. But it is painful to see the practice. I knew because -- but if you look at based on the paper this is kind of legal. So it is quite difficult. Proofing corruption it is very, very difficult. Whether we are going to have this kind of global collaboration, yeah, as long as we can make it, yes, we will do and we actually working closely with many other agencies, but again law enforcement agencies, the way they work very, very slow, very slow. Mutual legal assistance is sending letters, sending investigation and the money is already gone. Thank you.

MS. ABDULLAH: Thank you, Pak Laode. Applause for Pak Laode. Simon, please.

(Applause)

MR. CLYDESDALE: I'll try and be brief. So, yeah, sorry to depress you. The world is dark compared to place at times, but let's shed some light what more needs to be done, I mean how do we make them aware of the dire consequences, what I think you made them pay the price and people haven't been paying big enough prices. They've been acting with impunity for too long and not only the oil companies, but the gatekeepers, the enablers, the facilitators, the people that are as guilty as the people

who are doing the corruption, so that might be banks, it might be other people, okay, they get away with it, time and time again with fines too small. No one's getting locked up. So let's lock a few people up. Let's really make them -- let's make them pay the cost, the real cost, the cost that the communities have lost.

So for instance in the OPL case in Milan, not only is there a criminal case that's being brought by the public prosecutor, the Nigerian states have been allowed to now open a civil case within that criminal case. So to explain briefly, the criminal case may proceed and the individuals and companies may be told you have to pay X, Y, Z, but people like Dan Etete are on the run. We think we know where he is, but it's kind of hard to pick him up. So you can write that money off. But the civil case is against Shell and it's against Eni and those boys aren't going anywhere. They're going to pay up and you can make them pay billions -- okay, billions. You can take the license off them, okay. There are even regulations to stop them getting new licenses in the EU. You have the power. This power is not exercised often or well enough.

So I would also say that the data -- the world of data that is now coming through and the way you're trying to enable people to use will mean that people can understand what's going on. See inside the box for the first time, really understand the flow of money, follow the money, find out that there are actually hundreds of red flags, thousands of red flags possibly and follow them up. They're not all going to lead into places where you can make conclusions, but you're going to find some things that are going to lead into more courtrooms.

Just to make -- perhaps to make BO, beneficial ownership collaboration more effective. Open data is key to that. They're a big risk. This isn't going to get anywhere. Even in the U.K., which is an early mover, resources are not sufficient there. The company's house is basically my mom and a couple of dogs in a back room, they need a team of hundreds to be working on that and that needs to happen everywhere. There's a gap at the EITI as well on the funding and the capacity to do that. But the political space has now opened up like never

before thanks to the Panama Papers, the Paradise Papers, the awareness and the ability for politicians feel backed in doing this. The first time we're decoupling the influence of these corporations that for so long have been able to say to people, we're too important to your economy for you to trammel us. Now they are beginning to be able to push back against that. So I think that's quite important.

We have managed to puncher the wheels of these secret companies that act as the getaway cars. We're in the position now where we're not far away from being able to take the wheels off the car, but that's going to take an enormous amount of political will and investment, and we're a long way from that. And the risk is that they find someone else to sell them another car. So there's a lot of work to be done yet. So I am afraid to end on another depressing note.

MS. ABDULLAH: Yes, thank you Simon. Mas Bria, please?

MR. BRIA: Yeah, the question about the institution is always interesting. It's good to talk about that. It's so hard to do it when you talk about good rules and practices and who should oversee who and something like that.

So like -- I think the case for most of the countries like resource rich countries are that sometimes -- not sometimes but most of the time it's something to do with power, it's something to do with politics, it's something to do with -- I would say it's something to do with the culture of impunity. You know that some guy over there is corrupt. You know, that as Pak Laode said, it's very obvious that they're doing illegal mining, but the officials doesn't see it. He said it's so hard to detect. It's very obvious. It's something to do with. So on one hand like, it's good that you know actually this is something that is wrong.

The other question is whether you are actually making sure that actually that corrupt practice actually are sanctioned or something like that. So -- and this

culture of impunity, especially very strong, especially at the -- I would say at the local level, where the role of the media, independent media, the role of strong civil society, the role of the oversight bodies like at the national level KPK is quite strong. But at the sub- national level, I think the reach is not that far yet. And the role of judiciary is also still very weak. So one thing is that we know something corrupt is happening, the other thing is that you're actually acting against that. So it's a quite complex question and I'm not sure how to - - moving forward.

And then the second question about resource taxation on -- I think the discussion is about, I think domestic resource mobilization which was I think they started the discussion back I think 2 or 3 years ago in Ethiopia at the time. And then it goes back to the question about the shadow economy, again that our friend from the UN raised. So it seems that the state has formal institutions that every citizens trust to collect taxes, to make sure that they're using these resources wealth for their development are not doing their job very well and instead they are actually, there is I would say, what -- I think there's a term for that, but I forget, it's like there is a state within a state. And in many cases that this happen, especially like the government doesn't have enough legitimacy power in certain places and then you have informal leaders or some kind of actors who is much more powerful, and they have more followers, they have more legitimacy then, and that they're doing this kind of business. It's so hard for the state to enforce the rules because you have competing power against them, you know.

So it's -- you know, it's -- I think it's very difficult question to tackle, especially for -- my background is on political science, especially for a nation state -- in an early stage of the development of a nation state where you have formal and informal power within that, so I think. Thanks, yeah.

MS. ABDULLAH: Thank you, Mas Bria. A big applause for Mas Bria and Simon.

(Applause)

MS. ABDULLAH: And then for Mas Dadang, please comment about collective action and collaboration.

MR. TRISASONGKO: Collective action, it's beautiful work but it's not easy to -- based on our experiences in the field I think collective action or collaborative action should be started from consolidation amongst the actors themselves. For example, in the government level between -- or among KPK and some state agency have to consolidate first, and I think now it's more optimistic because under the presidential regulation now we have more solid team, national team on anticorruption strategy implementation.

After that the CSO side I think also we have to consolidate ourselves because we are so diverse among the CSO some crucial question is how we need to engage the private sector directly or we have to play in the outside, we have to consolidate first the position. And then in the private sector also there is still some -- they afraid to engage with the CSO, because in the fate also, in the reality some of the organization like CSO in the local or the national is like blackmailing to the company, so they have not good experience engaging with the organization like CSO.

So building or establishing the common interest is very crucial at the first level. What is the common interest to work together, economic growth or clean government or sustainable business, for example. I think KPK already started with what they call as committee (foreign language) Regional Advocacy Committee. It is like roundtable amongst the private sector, CSO and public sector. Yeah, of course we are learning now and, yeah, because the time is -- you'll finish. The iIndonesia (phonetic) have long experience helping the electricity state-owned companies and, yeah, this is the reality that government SOE and the CSO could sit together, put work together to improve the governance in the state-owned enterprises. Thank you.

MS. ABDULLAH: Thank you, Mas Dadang. So thank you everyone and also thank you for all of the speaker. I

didn't want to conclude, but I want to emphasize again the corruption is our common enemy in terms of developments, in terms of the economic growth, but also the big enemy to tackling inequality and poverty. So let's hand-in-hand in collaboration together, because this natural resource and extractive is very big, the unique corruption as well. So thus we need more super effort and collaboration to tackling this.

Give applause for all the speaker and also all of us. And this is the last session for the Civil Society Policy Forum. Thank you for all of the events' organizers and also all of the audience.

Last I -- reminder by the Publish What You Indonesia, we wanted to give some of the handicraft for the speaker. Kiki (phonetic), please. Standing in here - - * * * * *