The corruption and sustainable development nexus in Africa: a contemporary review and analysis
| Date | 21 December 2022 |
| Pages | 331-346 |
| DOI | https://doi.org/10.1108/JFC-10-2022-0257 |
| Published date | 21 December 2022 |
| Author | Kempe Ronald Hope, Sr. |
The corruption and sustainable
development nexus in Africa: a
contemporary review and analysis
Kempe Ronald Hope, Sr.
Policy Division, Development Practice International, Oakville, Canada
Abstract
Purpose –This study aims to re-examinethe corruption and sustainable developmentnexus in Africa and
offer a contemporaryanalytical review and analysis of that relationshipin the region.
Design/methodology/approach –Drawing on the available and accessible relevantdata from credible
sources, this work quantifies, outlines and analyses the nexus between corruption and sustainable
development, as it appliesprimarily to sub-Saharan Africa. It uses the relevant disaggregated data and also
complements thatwith the results of reliable empirical studies to further cross-referenceand demonstrate the
corruptionand sustainable development nexus.
Findings –It is shown that corruption in Africa continues to be negatively associated with sustainable
development objectives and that, in turn, will continue to affect the continent’s progress in achieving
sustainable development. Undoubtedly, corruption is very damaging to economies across all nations and
regions. However, in Africa, this impact on sustainable development has been particularly severe and
ongoing. Consequently,the views expressed several decades agoof corruption being able to grease the wheels
and potentially contribute to economic development is not valid and, in fact, has beenseverally discredited
over the years.
Originality/value –The main value of the paperis the insights it provides, and with cross-reference to the
empiricalliterature and time series data, on the corruption and sustainable developmentnexus in Africa.
Keywords Africa, Corruption, Sustainable development nexus, Growth, Contemporary review,
Contemporary analysis
Paper type Research paper
1. Introduction
A little more than two decadesago, Hope (2000, p. 17), for example, found that:
[...] corruption in Africa has reached cancerous proportions. In fact, so pervasive is this
phenomenon in the region that it [...] is destroying the future of many societies in the region.
Slightly less than a decade after Hope’sfindings and a little more than a decade ago, the
United Nations Economic Commission for Africa (UNECA) re-confirmed and reported that
“corruption remains the single most important challenge to the eradication of poverty, the
creation of a predictable and favourable investment environment and general socio-
economic developmentin Africa”(UNECA, 2009, p. 12). In a 2016 report, the UNECA further
lamented that “as both a product and cause of poor governance and weak institutions,
corruption is one of the major costs and impedimentsto structural transformation in Africa”
(UNECA, 2016, p. 16). More recently, as discussed below, a number of otherstudies –both
quantitative and qualitative –continue to show that corruption in Africa is negatively
associated with developmentobjectives.
Indeed, through various avenues (including bribery, embezzlement and theft, money
laundering and illicit financial flows [IFFs]and state capture), corruption continues to limit
Corruption and
sustainable
development
nexus in Africa
331
Journalof Financial Crime
Vol.31 No. 2, 2024
pp. 331-346
© Emerald Publishing Limited
1359-0790
DOI 10.1108/JFC-10-2022-0257
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1359-0790.htm
sustainable development prospectsin Africa. It has been observed that overall corruption is
responsible for the continent losing the equivalent of about 25% of its average gross
domestic product (GDP) and up to 50% in lost tax revenues annually (Hope, 2022). The
United Nations Conference on Trade and Development(UNCTAD) 2020 report on economic
development in Africa estimated that IFFs alone from sub-Saharan Africa was US$88.6bn
annually which significantly eclipses the US$54bn of foreign direct investment as well as
the US48bn in official development assistance (foreign aid) that flow into the region
(UNCTAD, 2020). These lost resources could all be used to advance sustainable
development objectives.
2. Corruption and sustainable development: literature review and analysis
We can generally summarise the empirical literature –along with the sustainable
development indicators –as showing that countries with higher levels of corruption also
have higher rates of poverty and inequality, and a disproportionate harming of those who
are poor and vulnerable [African Union (AU) and Organisation for Economic Cooperation
and Development (OECD), 2018; Chuahet al.,2020;Lopez-Claros, 2015;Uslaner,2015;World
Bank, 2019]; growth rates that are generally lower (Aidt, 2011;Cie
slik and Goczek, 2018;
d’Agostino et al.,2016;Gründler and Potrafke, 2019;IMF, 2016,2018a;Uberti, 2021;Ugur,
2014); average life expectancy that is lower (Lopez-Claros, 2015;Otusanya, 2011); maternal
deaths per 1,000 births that are higher, average child mortality rates per 1,000 live births
that are higher, less investment in education and health care, lower average years of
schooling and lower child health and educationindicators (Chuah et al., 2020; AU and Child-
Focused Agencies [CFAs], 2019); lower overall human development (Dimant and Tosato,
2018;Esona, 2020); higher propensity to experiencing food insecurity (Olabiyi, 2021); lower
public policy effectiveness, poorgovernance and a rise in capital flight (Hope, 2017a,2017b,
2022;Osei-Assibey et al., 2018);lower inward foreign direct investment (Cie
slik and Goczek,
2018); increased pollution and natural resource depletion (IMF, 2016); reduced levels of the
culture of compliance leadingto increased tax evasion and reduced tax revenues (IMF, 2019;
Jahnke and Weisser, 2019); sub-standardinfrastructure (IMF, 2016;O’Toole and Tarp, 2014;
World Bank, 2019); and a higher tendency to facilitate financial and organised crime (Hope,
2020;INTERPOL, 2019).
Other empirical results also show that bringing corruption in sub-Saharan Africa down
to the world average levels could increase GDP per capita in sub-Saharan Africa countries
by 1–2 percentage points (Hammadi et al.,2019). A relatively recent country study on
Mozambique, for example, by the Centro de Integridade Pública (CIP) and the Chr.
Michelsen Institute (CMI), aggregated the monetary value cost of corruption to the country
and demonstrated its negative impact on macro-economic aggregates such as GDP.
According to the CIP and CMI (2016,p.7):
[...] the estimated average annual cost of corruption, as observed during the ten years from 2004
to 2014, is up to US$4.9 billion, equivalent to around 30% of the 2014 GDP and 60% of the 2015
budget.
In looking further at both the direct and indirect costs of corruption, the OECD (2015) also
found that in developing countries heavily reliant on extractive industries as a driver of
economic growth and development (many of which are in Africa),corruption is expected to
continue to undermine the performance of their resource sectors. In that same vein, Gillies
(2020), in an analysis of corruptiontrends in Africa’s oil sector, noted that in those situations
where corruption is enticed by rents, the enabling environment is provided by the rentier
state.
JFC
31,2
332
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