Paradoxum’s mission is to assist countries so that governments can improve the management of their energy and resources sectors and optimize the benefits they receive from them- not only for the present, but for future generations as well.
Countries developing their natural resources face multiple challenges. Paradoxum has developed a set of practical tools to address these challenges.
The three pillars matrix : Appropriate Frameworks – Adequate Institutions – Proper Governance.
We believe the recipe for success requires having the proper frameworks (legal, fiscal and contractual), but also developing adequate institutional capacity. Too often, countries have sophisticated frameworks in place without the capacity to properly implement, enforce and monitor them. Finally, proper frameworks and good institutions are ineffective without good governance.
The reasonability test: Most governments encounter arguments from the industry that “this is standard” or “this is industry practice”. The truth is that what was reasonable ten years ago may not be acceptable anymore. Moreover, what would be considered a fair position in one country may not be in another. Governments must balance the necessity to remain attractive for investments with the objective to protect and optimize their rights over their resources.
Forensic Economics approach: While reviewing and revisiting the overall governance & regulatory environment is important, Paradoxum’s focus is to first identify why the government does not collect its fair share of benefits and resources revenues. Using a reverse-engineering methodology, Paradoxum works to identify the loopholes and necessary adjustments to correct the situation in the short-run while longer-term solutions are being developed and implemented