Brazil Gets Better Grade in Fighting Corruption But Still Fails

Justice statue in Brazilian capital BrasÀ­lia The latest report card for global corruption given annually by the London-based Transparency International is in and Brazil once again didn't quite make the grade. Brazil improved in its fight against corruption going from 3.3 points last year to 3.5 from a possible 10 points.

While Brazil improved two positions among the 180 countries listed in the Corruption Perception Index (CPI) this year, sliding from 70th place in 2006 to 72nd, this change falls into the study's margin of error.

The survey builds an ascending scale starting with the less corrupt nations, according to the level of corruption among politicians and civil servants.

The CPI, which uses reports by the World Bank, World Economic Forum and independent organizations, as well as polls with the country's citizens, goes from 10 for a perfect state to 0 for extreme corruption and venality. The lower the number the higher the corruption.

When Lula took office in 2003, the country was getting 3.9 for fighting corruption. Several scandals later, however, this number fell to 3.3.

Since the new study was made before a new and recent political scandal – the Renan Calheiros case in which the Senate's president (Calheiros) was kept in his post in a secret voting session, despite overwhelming evidence of corruption against him – it's doubtful that Brazil would still get the 72nd position if the evaluation was made now.

According to Transparency, in South America, only Chile (22nd place) and Uruguay (25th place) , which got respectively 7 and 6.7 points, are fighting corruption efficiently. All the others get grades below 5.

In Latin America, Brazil is also behind El Salvador and Colombia, but well ahead of Argentina, which got grade 2.9 and came in 105th position. Denmark, Finland and New Zealand lead the ranking of world's least corrupt countries, with 9.4 points. At the other extreme figures Haiti, Venezuela and Ecuador.

In the top 10, are also Singapore and Sweden, 9.3, which rank in fourth position; Iceland, 9.2, sixth; Netherlands and Switzerland, 9.0, number seven; Canada and Norway, 8.7, number 9.

The CPI ranks Chile with 7 points, position 22; Uruguay and Spain with 6.7 (25); Costa Rica, 5; Cuba, 4.2 (61); Salvador, 4 (67); Colombia, 3.8 (68); Brazil, Mexico and Peru, 3.5; Argentina, 2.9; Bolivia, 2.9; Nicaragua, 2.6; Paraguay, 2.4; Ecuador, 2.1; Venezuela, 2 and Haiti, 1.6.

"Despite some gains, corruption remains an enormous drain on resources sorely needed for education, health and infrastructure," said Huguette Labelle, Chair of Transparency International.

"Low scoring countries need to take these results seriously and act now to strengthen accountability in public institutions. But action from top scoring countries is just as important, particularly in cracking down on corrupt activity in the private sector."

Other interesting rankings are the United Kingdom, 12 with 8.4 points; United States, 20 with 7.2 points; China in the same 72nd position as Brazil, with 3.5; Argentina and Bolivia figure in position 105; Peru, 138; Paraguay, 140; Ecuador, 158; Venezuela, 162 and Haiti, 177. And Portugal 28th place.

In last year's CPI edition, Venezuela and Ecuador ranked 138 and Haiti, 163. Mexico on the other hand improved from 3.3 points last year to 3.5 in 2007.

Low scores in the CPI indicate that public institutions in poor countries are heavily compromised. The first order of business is to improve transparency in financial management, from revenue collection to expenditure, as well as strengthening oversight and putting an end to the impunity of corrupt officials, says the CPI report.

An independent and professional judicial system is critical to ending impunity and enforcing the impartial rule of law, to promoting public, donor and investor confidence. If courts cannot be relied upon to pursue corrupt officials or to assist in tracing and returning illicit wealth, progress against corruption is unlikely.

"Partnering with civil society and citizens is another essential strategy for developing countries seeking to strengthen the accountability of government. Civil society organizations play a vital watchdog role, can help stimulate demand for reform and also bring in expertise on technical issues," said Cobus de Swardt, Managing Director of Transparency International. "But, increasingly, many governments are moving to restrict the operating space of civil society."

In addition, many countries are unable to shoulder the burden of reform alone. In countries where public sector institutions were historically based on patronage and nepotism rather than merit, reform takes time and can require a substantial investment of resources, as well as technical assistance.

The top scores of wealthy countries and territories, largely in Europe, East Asia and North America, reflect their relatively clean public sectors, enabled by political stability, well-established conflict of interest and freedom of information regulations and a civil society free to exercise oversight.

But corruption by high-level public officials in poor countries has an international dimension that implicates the CPI's top scorers. Bribe money often stems from multinationals based in the world's richest countries. It can no longer be acceptable for these companies to regard bribery in export markets as a legitimate business strategy.

In addition, global financial centers play a pivotal role in allowing corrupt officials to move, hide and invest their illicitly gained wealth. Offshore financing, for example, played a crucial role in the looting of millions from developing countries such as Nigeria and the Philippines, facilitating the misdeeds of corrupt leaders and impoverishing those they governed.

Akere Muna, Vice Chair of Transparency International, pointed to the recovery of stolen assets as another area ripe for enhanced action by developed nations, noting, "Criticism by rich countries of corruption in poor ones has little credibility while their financial institutions sit on wealth stolen from the world's poorest people."

In many cases, asset tracing and recovery are hindered by the laundering of funds through offshore banks in jurisdictions where banking secrecy remains the norm. Through the UNCAC, priority should be given to improving international cooperation and mutual legal assistance, expediting action to recover assets, and developing legal and technical expertise in nations requesting the return of looted assets.

For many countries, repatriation of funds will mean long and extensive litigation. "In addition to ensuring adequate legal funding, simplifying recovery procedures and provisions for third party institutions to act as escrows during litigation must be a high priority," Muna added



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