Corruption continues to cost opportunities for world’s poor

G8 still far from fulfilling anti-corruption promises

On fighting domestic and international corruption and in supporting good governance at home and abroad, the Group of Eight (G8) has made advances but still has promises to fulfil. Transparency International (TI) reminds the G8 leaders of their past commitments and cautions that those represent an absolute minimum for further action.

“Despite the regrettable failure to include poverty and development on this year’s summit agenda, the G8 must not lose ground in fulfilling its commitment to the fight against corruption as a central pillar of poverty reduction,” said Huguette Labelle, chair of Transparency International. “Beyond its damaging systemic effects on economic development, corruption eats into the effective delivery of education, healthcare and infrastructure. Millions of lives would be made better through their clean, transparent provision.”

In the new millennium, G8 members, recognising corruption as the primary obstacle to development, have repeatedly pledged to improve financial management and accountability and support better governance in the poorest countries; fortify financial markets against abuse; and crack down on corrupt behaviour, at home and abroad, by companies based in G8 countries.

“Promises don’t reduce corruption; actions do. Taking the public pledge gets you the headlines, but real people the world over are waiting for those promises to be fulfilled,” stated David Nussbaum, Chief Executive of Transparency International.

Corruption and the fight against poverty

Most recently, the G8 summit at Gleneagles was notable for its heavy focus on Africa and development. Issues of governance and corruption loomed large. Echoing the G8 Action Plan on Fighting Corruption and Improving Transparency launched at the 2003 Evian Summit, a number of pledges were made, including:

• Support for the African Peer Review Mechanism (APRM) that, among other things, represents an Africa-based tool for monitoring improvements in governance; Germany has pledged its financial support;
• Support for greater transparency in public financial management;
• Support for African partner countries in ratifying the African Union Anti-Corruption Convention;
• Identification, freezing and repatriation of assets gained through corrupt means;
• Commitment to work vigorously for early ratification of the UN Convention against Corruption and to pursue mechanisms for its effective implementation;
• Increased support for the Extractive Industries Transparency Initiative (EITI).

One year on, some progress has been made. France, Russia and the United Kingdom have ratified the UN Convention against Corruption; Canada, Germany, Italy, Japan, and United States have yet to ratify, though some are moving in that direction.

However, more action is needed. All remaining G8 countries should ratify the UN Convention against Corruption. The EITI needs greater material support in order to consolidate its achievements, improve implementation and attract the support of additional governments and companies.

Foreign bribery by companies based in G8 countries

In line with their Gleneagles and Evian commitments, G8 governments should vigorously enforce OECD Anti-Bribery Convention by swiftly prosecuting companies that pay bribes to foreign public officials. Although the US and France have significantly increased the number of prosecutions in the past year, and Germany has a few pending prosecutions, of the other G8 signatories (Russia is not a signatory), Japan and the United Kingdom have brought no prosecutions at all, and Canada and Italy have only brought one each. This is a shockingly low level of enforcement for countries that account for a substantial share of the world’s trade and investment.

Following up on their Gleneagles commitments, G8 countries should also report on the extent to which they are cooperating with African governments to ensure prosecution of those engaged in bribery and bribe solicitation.

Increased aid and debt relief

As aid and debt relief for the world’s poorest countries is ramped up, Transparency International urges recipient and donor nations to ensure that assistance takes place within a framework of mutual accountability. In countries with weak public financial management and accounting systems, this should include a time-bound programme of measures that can be monitored and that enables involvement of local citizens in all steps of the aid cycle, from needs assessment to monitoring the use of funds, to implementation.

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