Foreign bribery rages unchecked in over half of global trade

Foreign bribery rages unchecked in over half of global trade

There are many losers and few winners when companies bribe foreign public officials to win lucrative overseas contracts. In prioritising profits over principles, governments in most major exporting countries fail to prosecute companies flouting laws criminalising foreign bribery.

What is missing is active enforcement. Transparency International’s new report, Exporting Corruption, finds that only 11 major exporting countries - accounting for about a third of world exports - have active or moderate law enforcement against companies bribing abroad in order to gain mining rights, contracts for major construction projects, purchases of planes and other deals.

Country by country, the report names the top offenders as well as the flaws in national legal systems that allow this crime to continue unchecked. One of the most shocking examples exposed in recent years is the massive foreign bribery scheme carried out by the Brazilian construction conglomerate Odebrecht involving about US$788 million in bribes to government officials and political parties in at least 12 countries.

The cost of foreign bribery

Foreign bribery has huge negative consequences for the economies of the nations targeted. Money gets wasted on deals that are overpriced or do not yield real benefits. Limited resources are diverted to benefit a few individuals while citizens are denied vital public services, such as access to clean water, safe roads or basic health services.

Around the world, competitors that offer better products lose out in an unfair marketplace and this triggers a race to the bottom, with some companies choosing to engage in bribery because others are doing it.

This is why the Organisation for Economic Co-operation and Development (OECD) Anti-Bribery Convention requires parties to criminalise bribery of foreign public officials and introduce related measures, such as investigating suspicious cases. Its goal is to create a corruption-free level playing field for global trade.

The Exporting Corruption report rates the performance of 44 leading exporters, including 40 of the OECD Convention signatories. For the first time, it rates four non-OECD Convention exporters: China, the world’s largest exporter, as well as Hong Kong, India and Singapore, accounting for about 18 per cent of world exports.

Not enough progress

The good news is that eight countries accounting for 7.1 per cent of world exports have improved their performance since the last report in 2015. Seven countries are now in the active enforcement category, compared with four in 2015. They are Germany, Israel, Italy, Norway, Switzerland, the United States and the United Kingdom.

The bad news is that there is still a long way to go. Four countries, accounting for 6.7 per cent of world exports, have deteriorated in their performance and a total of 33 exporters, accounting for about 52 per cent of world exports, still have limited or little to no enforcement against foreign bribery. That includes all four of the exporters not party to the Convention — China, Hong Kong, India and Singapore — all of which get the lowest rating of little or no enforcement.

The results show that we are far from bringing enforcement against foreign bribery to a tipping point. Governments must scale up their foreign bribery enforcement. This means investigating allegations and pressing charges, as well as courts convicting guilty individuals and companies, and imposing substantial sanctions where appropriate.

What needs to be done

The enforcement gap that exists in China, Hong Kong, India and Singapore needs to be closed by joining the OECD Convention and, along with all other countries involved in global trade, stamping out foreign bribery with the necessary legislation and enforcement.

Transparency International also recommends that governments:

  • address weaknesses in their legal frameworks and enforcement systems, including inadequate resources for cross-border enforcement
  • ensure settlements of foreign bribery cases are reached transparently, accountably and through appropriate processes, with dissuasive and even-handed sanctions
  • improve accountability and deterrence, by publishing up-to-date statistics and information on court cases
  • assist cross-border investigations by sharing more information with other countries

In addition, the OECD Working Group on Bribery should make greater use of public announcements to name and shame countries that are not enforcing against foreign bribery, just as Transparency International is doing in this report. It should also create a public database of enforcement data and case information, and conduct a cross-country study of information sharing performance across all parties.

To learn more about foreign bribery - globally and relating to 45 exporters - and how to prevent it, read Exporting Corruption - Progress report 2018: assessing enforcement of the OECD Anti-Bribery Convention.

See previous editions of our OECD Progress Report:

  2015   
  2014
  2013
  2012
  2011
  2010
  2009
  2008
  2007
  2006
  2005 

For any press enquiries please contact press@transparency.org

Latest

Support Transparency International

Support Us

What people think: corruption in the Middle East & North Africa

Momentum has been building against corruption for years in the Middle East and North Africa. From Lebanon and Sudan, where millions of people took to the streets earlier this year to speak out against their governments, to the Arab revolutions that toppled corrupt leaders nearly a decade ago, people are fed up with rampant corruption across the region.

Wasta: How personal connections are denying citizens opportunities and basic services

In many Arab countries the use of personal connections, or “wasta” in Arabic, is a common practice and a social norm. People use their family or social contacts to skip the line and gain quicker and better access to basic goods and services. How much you can increase the speed and quality of your service often depends on who you know – the higher the better, of course.

Sextortion: Middle East and North Africa

Sextortion is one of the most significant forms of gendered corruption and although women’s rights have advanced unevenly across the Middle East and North Africa, positive momentum has been building in the region over the last decade.

Lack of political integrity is undermining trust in democracy in Middle East and North Africa

The Global Corruption Barometer – Middle East and North Africa 2019 reveals that leaders in the region are perceived as acting in their own self-interest at the expense of the citizens they are meant to serve. This has serious consequences for trust in democratic institutions.

آراء المواطنين:  الفساد في منطقة الشرق الأوسط وشمال أفريقيا

لقد تزايد زخم التنديد بالفساد خلال السنوات الماضية في منطقة الشرق الأوسط وشمال إفريقيا. وضاق الناس ذرعا بالفساد المستشري في مختلف أنحاء المنطقة، من لبنان والسودان، حيث خرج ملايين الناس إلى الشوارع في مطلع هذا العام للتنديد بصوت عال بممارسات حكوماتهم، إلى الثورات العربية التي أطاحت بالزعماء الفاسدين منذ زهاء عشر سنوات.

الرشوة الجنسية: منطقة الشرق الأوسط وشمال إفريقيا

على الرغم من تفاوت التقدم المُحرز على مستوى حقوق المرأة في مختلف أنحاء الشرق الأوسط وشمال إفريقيا، شهدت المنطقة زخما إيجابيا تنامى تدريجيا خلال العقد الماضي. إذ أصبح عدد أكبر من النساء يُعبّرن عن أنفسهن داعيات إلى تعزيز تمثيل المرأة في الحكومة وتجريم العنف المنزلي وتحقيق المساواة في الحقوق للنساء والفتيات، إلى جانب عدد من المسائل الأخرى التي تهم المرأة. وتُناضل النساء في مختلف دول المنطقة من أجل إعلاء كلمتهن.

حرمان المواطنين من مختلف الفرص والخدمات الأساسية  بسبب استغلال آخرين لعلاقاتهم الشخصية

يُعتبر استغلال العلاقات الشخصية في البلدان العربية، أو ما يُعبّر عنه بالواسطة، مُمارسة منتشرة ومُتعارف عليها اجتماعيا. إذ يستغل مختلف الأشخاص علاقاتهم الأسرية أو الاجتماعية لعدم الوقوف في الصف وللوصول على نحو أسرع وأفضل إلى المدارس أو الجامعات أو المستشفيات أو الوظائف، و"لتعجيل" الإجراءات الإدارية في المؤسسات الحكومية مثل تجديد وثائق الهوية أو شهادات الميلاد. وتعتمد عادة سرعة حصولك على الخدمة وجودتها على الشخص الذي تعرفه؛ فبطبيعة الحال، كلما كان في منصب أعلى كان ذلك أفضل لك.

Social Media

Follow us on Social Media