/ 1 January 2002

Bribery in developing world rampant- report

The global anti-corruption organisation Transparency International’s (TI) Bribe Payers Index for 2002, released on Tuesday, shows very high levels of bribery in developing countries including South Africa.

Corporations from Russia, China, Taiwan, South Korea and several leading industrial nations were most likely to offer bribes to developing nations.

This is despite the fact that all of these countries now have laws making corrupt payments to foreign officials illegal.

”The laws are not being properly enforced. Our new survey leaves no doubt that large numbers of multinational corporations from the richest nations are pursuing a criminal course to win contracts in the leading emerging market economies of the world,” TI chairman Peter Eigen said.

”The governments of the richest nations continue to fail to recognise the rampant undermining of fair global trade by bribe-paying multinational enterprises.”

Companies from Russia and China which are increasing exports to other emerging market economies were found to be using bribes on ”an exceptional and intolerable scale”.

The extent of bribery abroad of Taiwanese and South Korean companies was only slightly less. Domestic companies in developing countries were also found to be involved in heavy bribe-paying.

US and Japanese multinationals had the highest propensity to pay bribes to foreign government officials followed by France, Spain, Germany, Singapore and the UK. Those with the lowest propensity to bribe officials abroad were companies from Australia, Sweden, Switzerland, Austria, Canada, Belgium and the Netherlands.

”Today’s BPI underscores the fact that we have a global problem of corporate bribe-paying that demands concerted global actions by official international organisations, civil society organisations and national governments,” said TI advisory council chairman Kamal Hossain.

The sectors showing most flagrant corruption were public works and construction, followed by arms and the defence sector.

The UK branch of TI found in a new study that foreign bribery is associated with tens of billions of dollars of defence deals.

The OECD anti-bribery convention that criminalises multinational’s bribes to governments ratified two years ago has not made any difference so far. In fact, the new BPI found that corporations are not particularly concerned about the risk of criminal prosecution.

The BPI was conducted in 15 emerging market countries: Argentina, Brazil, Colombia, Hungary, India, Indonesia, Mexico, Morocco, Nigeria, the Philippines, Poland, Russia, South Africa, South Korea and Thailand. – Sapa