Clarity and action needed on corruption

In September a special summit ofthe United Nations General Assembly held in New York saw 193 nations agree to seventeen Sustainable Development Goals (SDGs).Their objective was to establish a set of principles that up to 2030 will drive the development policy and programmes of governments and nationaland multilateral institutions everywhere.

One of these goals, Goal 16, is particularly far reaching and political in its intent.It aim is to ‘promote peaceful and inclusivesocieties for sustainable development, provide access to justice for all andbuild effective, accountable and inclusive institutions at all levels’. As with each of the othergoals, UN members agreed that within each, there would be a number of specific targets. In the case of goal 16, one of these was to ‘substantiallyreduce corruption and bribery in all their forms’.

All ofwhat was agreed is now subject to ratification nationally by every government, butaddressing corruption has when it comes to the SDGs become a particular and immediate focus. The UN Secretary-General, Ban Ki-moon, forinstance in a message to a conference in St Petersburg, Russia last month emphasised his beliefthat to achieve the new development agenda, all country’s must act to end corruption and bribery. “Let usforcefully convey the message that when bribes are paid, everyone counts thecost," he said.

The BritishPrime Minister, David Cameron, in particular has been stressing the importanceof issue, having led the discussion at the 2013 G8 summit of the wealthiestindustrialised countries which had tax evasion and transparency as its theme. Morerecently one of his major themes when he addressed the JamaicanParliament, was working together toeradicate corruption and encourage greater transparency.

It is an issue that is likely to be voiced withincreasing frequency at all international fora; with a global Anti-Corruption Summit due to beconvened by Britain in 2016 to which all Caribbean states including the Overseas Territories in the region willbe invited.

What isdriving the need to address corruption is the belief that the issue now goesfar beyond the concern that it diverts public and private resources forpersonal gain. It responds to evidence that corruption has wider damagingimplications that undermine development and democracy.

Recent studies by multilateral bodies, NGOs andacademics, suggest that corruption is affecting all nations’ ability to raisetaxes and deliver public services such as education, health care andinfrastructure; is distorting markets; is corroding the rule of law, perpetuatingpoverty, and is undermining institutions and public trust. There is also concernabout the way in it which it is facilitating in diverse ways the continuingrise of organised crime and terrorism, and because of the colossal sumsinvolved may be used ultimatelyto delegitimise states and undermine global stability.

The mostwidely quoted figures, used for instance by the OECD in 2014, suggest thatcorruption now involves US$ 2.6 trillion annually or more than 5 per cent ofglobal GDP; that over US$1 trillion is paid in bribes each year; that it adds 10per cent to business costs globally each year; and according to the IMF, results in 5 per cent moreinvestment in nations regarded being relatively corruption-free.

That said the challenges associated with ending or even stemming corruptionare multiple and complex.

At one end of the spectrum the fundamental issue is about personal moralityand ethics, while at the other it requires, in some nations and cultures, overturning accepted entrenched custom andpractice. There are also unanswered questions about addressingthe close relationship in many nations between criminality, bigbusiness and power; thewillingness of those nations in Europe and North America that speak loudest to demonstratethat they are addressing their own problems; and how best to tackle the largelyunstudied subject of personal motivation which can variously involve greed, ego,a sense of entitlement, a desire for power or a materialist global life style.

A further very real problem is that it is unclear how underthe SDGs targets are to be established for reducingcorruption and bribery, or how the issue is to be monitored and measured. Althoughthere are number of existing annual reports – the annual corruption perceptionindex produced by the well-respected organisation Transparency International’s isperhaps the best known – it is far from clear whether the statistical bases usedin such reporting measure like with like.

A further problemis that activities regarded as corrupt take place at all sorts of levels and inmany different ways.

In a Caribbeancontext examples might include the not uncommon business practice of managing transferpricing between a company’s international entities or through under-invoicinglessening tariffs and taxes, but it also includes for example, the subversionby narco-traffickers of those responsible for policing or government.

There is also highlevel institutional corruption. For example in the Dominican Republic growing concern has been expressed bythe country’s business leaders about the partiality of the judiciary. Therethe dismissal of recent high profile politically linked cases has led to the AttorneyGeneral suggesting that there was a need for the Supreme Court to order aninvestigation into judges. It has also caused one of the country’s respectedbusinessmen, Franklin Baez Brugal, saying at a public meeting which thePresident attended, that more checks and balances were required to eradicatethe “plague” of political patronage, and that the judiciary that could curbthese excesses, “languishes in obvious institutional weaknesses”.

No doubt every reader will have their own domestic examples,but in the last few days alone in Curaçao CoastGuard officers have been charged with corruption, money laundering and thepossession of narcotics, and the never ending FIFA scandal has continued with newarrests of those alleged to be involved in widespread corruption at CONCACAF.

Corruption is a scourge and damaging to all who liveordinary honest lives. However there is a danger that without greaterdefinition of the approach to be taken, the priorities and objectives what isbeing proposed will be as seen as self-serving political rhetoric andhypocrisy.

Politicians for whatever reasons continue to confuse whenthey speak, criminality, security, development, tax avoidance and evasion, anda range of trans-national financial and commercial activities; even those thatare legal but aggressively use the arbitrage of tax and legal differencesbetween jurisdictions.

Greater definition and some clear and deliverableobjectives are required, including prosecutions in the countries concerned, ifvoters are to ever be convinced that change is possible.

DavidJessop is a consultant to the Caribbean Council and can be contacted at

david.jessop@caribbean-council.org

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