G-7 Talks Tough On Corruption

Pushing Bribery Issue Higher As Key International Economic Policy Issue

The Group of 7 finance ministers, meeting in Washington this week, called on the international financial institutions and the Organization for Economic Cooperation and Development to accelerate work on the reduction of bribery. The G-7 communiqué stressed the "corrosive effects of bribery and corruption generally on the achievement of sustainable economic development, growth and stability."

Prof. Dr. Peter Eigen, Chairman of Transparency International (TI), the non-governmental coalition to curb international corruption, headquartered in Berlin, said: "this is a landmark declaration by the G-7 in the global fight to curb corruption. It is likely to give major stimulus to official discussions on new anti-corruption policies and raise these discussions to a more urgent political level."

The G-7 called on the multilateral development banks to establish uniform procurement models and "ensure strong oversight at headquarters of all facets of the procurement process." TI, which now has national chapters in over 70 countries, is working closely with the World Bank to secure progress on the critical issue of transparency in international procurement.

The G-7 in paragraph 17 of its communiqué, called on the International Monetary Fund and the multilateral development banks "to strengthen and expand... their activities to help countries fight corruption." Dr. Eigen said: "Over the last 12 months TI has had an expanding and deepening dialogue with the IMF and the World Bank on these issues. We are finding a refreshing and positive perspective from the leaders of these organizations and we believe the G-7 declaration will add support to their efforts in this crucial area."

The communiqué called on the leading industrial countries, who are members of the OECD, "to reach agreement on measures that will permit effective and coordinated criminalization of foreign bribery and facilitate expeditious elimination of the tax deductibility of such bribes." Dr. Eigen noted that "bribing is the 'supply side' of corruption. And much of the supply comes from international businesses in the G-7 countries."

The TI Chairman added that: "The tax deductibility allowed by most OECD countries for bribes paid to foreign officials is a disgrace. It encourages bribery and constitutes a double standard. It is not only morally indefensible and harmful to countries where the bribes are paid, but also has a pernicious influence on ethics within the bribing corporations. By urging the OECD countries, the multi-lateral development banks, and IMF to prohibit foreign bribery and eliminate its tax deductibility, the G-7 have placed corruption high on the international agenda - where it belongs," he said.

Transparency International is circulating the G-7 statement of April 27, 1997 to all its chapters around the world and urging them to monitor closely progress to implement it.