CORRUPTION.

Author:Nevin, Tom
Position:Statistical Data Included

What it is, what it does and how to beat it

In this millennium issue, we are going to examine one of Africa's greatest economic scourges, corruption. It is a subject that generates a great deal of passion but few concrete solutions. In this special report, we are publishing articles by people who have studied the theme in depth and who are committed to end this plague once and for all as a new chapter of Africa's history begins to unfold. We begin with Tom Nevin's account of Transparency International's new listing - that of international corrupters, those who give the bribes in the first place.

Searchlight now turns on corrupters

The fact that two African countries head the list of the world's most corrupt nations is cause for concern. And the situation isn't getting any better. In fact, it may be getting worse. However, the organisation that compiles the list has discovered that there is another side to the coin and they have put a new spin to corruption. Quite logically, they argue, that if there are recipients of bribes to grease a commercial transaction, there must also be the providers. Both are equally guilty of corrupt practices and should be prosecuted.

According to Transparency International (TI), an independent organisation that tracks government employee corruption worldwide, bureaucratic officials in the former Soviet bloc, Asia, Latin America and Africa are the least trustworthy and most susceptible to bribes.

Finger-pointing exercise?

The list, the Corruption Perceptions Index (CPI), which is published every year, is often seen by developing nations as a finger pointing exercise by the first world. The fairness of the index has become such a hotly debated topic that a rethink was called for. Transparency International recognised that it may have been looking at one side of the picture only and did something about it. TI's vice chairman, Frank Vogi, conceded that there was a case to probe not only bribe takers, but bribe givers as well.

"There was a sense in some countries that we were a group from the richer north that was singling out poor countries," he revealed. "People said that basically there is a conspiracy of corruption between the takers of bribes and the givers of bribes, and it should be recognised. We thought we would create a Bribe Payers Index (BPI)."

The BPI ranks 19 leading exporting countries in terms of the degree to which their corporations are perceived to be paying bribes in foreign countries. The index, undertaken for TI by Gallup International in 14 leading emerging market economies, shows that companies from many leading exporting nations are widely seen as using bribes to win business.

"The data provides a disturbing picture of the degree to which leading exporting countries are perceived to be using corrupt practices," says TIE chairman, Peter Eigen. "The governments of these countries must take determined actions to stop businesses headquartered in their countries from bribing foreign officials. We also call on corporations to adopt effective anti-corruption programmes."

Successes mounting up

The organisation has already notched up some notable successes in its campaign against bribery. To dare 34 countries, including all leading exporting nations, have agreed to an Organisation for Economic Cooperation and Development (OECD) convention to make the bribery of foreign officials a criminal offence.

"The data shows how urgent it is that all major exporting nations ratify the OECD Convention on Combating Bribery of Foreign Public Officials in International Business," says Eigen. Eighteen countries have ratified the convention.

"The BPI results highlight considerable differences in the willingness of companies to pay bribes, which challenges the private assertions by many businessmen that they need to pay bribes just because their competitors do," says Eigen.

The BPI reveals that on a scale of 0-10, where 10 represents a corrupt-free exporting country, the best score among 19 leading exporting countries was 8.3, while the worst score, representing a great propensity to use bribes, was 3.1. China (including Hong Kong) was seen as having the greatest willingness to pay bribes abroad, followed by South Korea, Taiwan, Italy and Malaysia. Sweden, Australia and Canada achieved the most favourable results.

Vogl contends that the two indices - CPI and BPI - are closely inter-related as it is fashionable these days to be against corruption and to demand that countries clean up their houses before aid is granted. "Many major industrial countries do quite well on the CPI, yet they are not discouraging their own firms from corrupting foreign governments," he points out.

While the BPI is a distinct survey commissioned by TI, the CPI is a 'poll of polls' and the two indices are created with different methodologies and are not directly comparable.

"However," notes Eigen, "the BPI and the CPI are two sides of the same coin: the former ranks the home countries of the payers of international bribes, the latter ranks countries in terms of the degree to which they are perceived to be the homes of bribe-takers, the public officials who abuse their office for public gain."

Need to confront the issues

In Eigen's view, governments of countries with low CPI scores need to do far more to publicly acknowledge the problems, to confront the issues, to subject the corrupt companies and the corrupt officials to prosecution and to earn public confidence by their anti-bribery policies. "Some countries have begun to take such action," he says, "but have initiated reforms so recently that these are not reflected in the polls on which the CPI is based."

TI has recently been reviewing the impact of the CPI and ways to improve the application of surveys to raise public understanding of corruption. One result was the inclusion of 99 countries last year, compared to 85 in 1998 and 52 in 1997.

Transparency International was founded six years ago by a small group of people who had watched development aid fail to achieve its goals as corruption flourished. It now has 77 chapters world-wide and has gained high public and private credibility.

"Five years ago we couldn't get into the World Bank," says Vogl. "We were told that this was politics. Now the civil society movement asking questions in many capitals about why health care or other services receive no money while officials buy aircraft."

Only with continued pressure will progress be made.

1999 Transparency International Bribe Payers Index (BPI) Ranking 19 Leading Exporters Rank Country Score 1...

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