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Europe and Central Asia: Why anti-corruption laws are not stopping the corrupt

Transparency Int'l

While a handful of countries in Europe and Central Asia have improved this year, the general picture across this vast region is one of stagnation. Governments are willing to pass laws addressing corruption, yet enforcing them is a very different matter. Very worrying is the marked deterioration in countries like Hungary, FYR of Macedonia, Spain and Turkey. These are places where there was once hope for positive change. Now we’re seeing corruption grow, while civil society space and democracy shrinks.

In Hungary, Poland and Turkey, politicians and their cronies are increasingly hijacking state institutions to shore up their power.

The good

Nordic countries score highly again – with Denmark, Finland, Sweden and Norway coming in the top five. Yet we’ve seen big corruption cases in all four in 2015, including 13 Danish public employees arrested in a corporate bribery case; the mayor of Bergen, Norway’s second largest city, charged with bribery after reportedly accepting a paid-for cruise in exchange for favours; Sweden’s partly state-owned TeliaSonera (in which Finland also has a minority stake) exiting Eurasian markets amid huge bribery allegations in Uzbekistan; and the ongoing trial of the former head of Helsinki police’s antidrug squad, charged with running a drug cartel of his own. Clearly there’s still work to be done.

Some scores have improved significantly in recent years – most notably Malta and Greece, but also Austria, Czech Republic, Slovakia and the UK – but again the picture’s complex and it remains to be seen how much this is due to genuine reform.

The bad

Corruption remains a huge challenge across the region, often going hand-in-hand with repression. In low-scorers Hungary, Poland and Turkey (which has plummeted in recent years along with Spain) politicians and their cronies are increasingly hijacking state institutions to shore up their power – a worrying trend also affecting the Balkans. Further down the index the picture is even grimmer: in Azerbaijan, Kazakhstan, Russia and Uzbekistan and others, governments are restricting, if not totally stifling, civil society and free media – both proven to prevent corruption.

Ukraine is also near the bottom of the list – an indication of the challenges faced by a government which is dragging its heels in carrying out much needed reforms.

A relentless stream of banking scandals continued in 2015…more irrefutable proof that the financial sector – banking in particular – is in dire need of reform.

In Western Europe a relentless stream of banking scandals continued in 2015, as Deutsche Bank paid a record US$2.5 billion to settle allegations that it manipulated the Libor benchmark rate. It’s the largest Libor fine in history and yet more irrefutable proof that the financial sector – banking in particular – is in dire need of reform.

What needs to happen

Laws need real teeth. There’s anti-corruption legislation on the statute books everywhere – albeit patchy and with room for improvement – but what’s missing is implementation and enforcement. In country after country the result is the same: the corrupt operate with impunity. Governments need to tackle political corruption and financial sector reform urgently – and this can’t happen until laws and regulations are properly enforced, and there’s a truly independent media and civil society to speak out when they’re not. Only then will we be able to prevent corruption.

Priorities

CPI

Countries

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