corruption

Not long ago, the world praised Chile as an exception among South American nations. We were the classic “star pupil”, the guy who is definitely not popular at school: instead of playing fine soccer, instead of dancing joyfully, we concentrated on homework. Nowadays, any observer of Chile’s reality can easily deduce that our glories have withered to a failed experiment, rather than blooming as a role model. Pushing the allegory further, the once brilliant student has ended up shoplifting and smoking dope. Read more

Only five months after being narrowly reelected, Dilma Rousseff, Brazil’s president, faces a growing array of problems, including a major bribery scandal and myriad economic challenges. Hundreds of thousands of Brazilians have taken part in recent protests against her, with many calling for her impeachment. And it wasn’t the first time demonstrations have rocked the country during Rousseff’s tenure –millions also took to the streets in the run-up to the 2014 World Cup.

But Rousseff is hardly the only leader of an emerging market to face public anger in recent years. Protest movements have erupted in the Middle East, eastern Europe, Asia, and Latin America. Emerging markets have benefited in many ways from globalisation, but rising incomes have also led to rising expectations. Newly empowered citizens in the emerging world are demanding more accountability from their leaders, and as a result we are likely to see more protests and upheaval. Read more

In 2004 and 2005, Bulgaria was unexpectedly hit by torrential rain that caused extensive flooding. To deal with the destruction, the government awarded nearly €67m to 257 flood-stricken municipalities (see map below). For many of Bulgaria’s impoverished municipalities, the funds were a substantial financial injection, and mayors and local councils were the ultimate authority on how the money was spent. Not surprisingly in a country ranked as the second-most corrupt in the EU, the media uncovered multiple instances of local politicians pocketing the money. According to estimates by opposition parties, €59m disappeared into the coffers of firms related to the ruling political coalition.

Distribution of flood funds, per capita (in lev)

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So much is going wrong in Brazil that it is hard to keep up. For years, critics have accused the government of incompetence. Now its actions are looking catastrophic – so much so that there are good reasons to think President Dilma Rousseff, who began a second four-year term only on January 1, may not last much longer.

Here is our list of 10 things that threaten to bring her down. Read more

Narendra Modi, India’s pro-business prime minister, swept to power last year offering a new efficient form of government and a crackdown on the high-level corruption that has weighed on growth for decades.

But in a new report, analysts at Ambit Capital, a Mumbai-based brokerage, suggest that this otherwise positive shift may be negative for India’s rural economy – if only in the short-term. Read more

Mayors fronting drug cartels, a union leader splurging thousands on cosmetic surgery, and a multi-million-dollar mansion reportedly gifted to the president by a federal contractor. Enrique Peña Nieto’s first two years in charge have not been short of scandals.

Peña Nieto was pitched by many as Mexico’s great reformer. Since taking office in December 2012, the Institutional Revolutionary Party (PRI) politician has achieved the seemingly impossible, ushering through a string of key economic reforms with a view to boosting investment, competitiveness, and growth. Read more

By Alejandro Poiré of Tecnológico de Monterrey

What makes Mexico’s current political turmoil unique is that it has put the problem of corruption front and centre of the social agenda. Streets, schools, homes, corporate offices, union meetings and workplaces are teeming with a mix of anger and concern. There is an underlying feeling that it is corruption that lies at the root of our inability to protect the innocent from murder and abuse; that it is corruption that could derail the future promised by the remarkable reforms of the past few years.

As Mexico’s leading public intellectuals have argued, its current crisis, a crisis of corruption and rule of law, calls into question its very viability as a democracy. Yet its political elites have yet to grasp the depth of the problem. The government’s leadership style has pushed social allies away. Opposition parties, mired in their own decomposition, have not served as a channel for social outrage, and players on all sides of the aisle seem way too eager to look past their lamentable wrongdoings. Read more

How far to trust a politician? Often a tricky subject – especially in a country like Mexico, where impunity is rife and many elected representatives appear still to live by the maxim of the late Carlos Hank González, an influential politician and businessman (with a statue to his honour in the city of Toluca), namely: “A politician who is poor is a poor politician.” Read more

By David McNair, the ONE Campaign

As the G20 leaders meet in Australia to discuss economic growth, the elephant in the room is corruption. The uncomfortable truth is that at least a trillion dollars are syphoned from developing countries every year as a result of tax evasion, money laundering, bribery and other forms of financial crime. Much of this money flows through anonymous companies registered G20 countries.

But while campaigners and governments have fought hard to forge consensus among G20 leaders on ensuring that these secret firms that facilitate corruption are addressed, last minute politics between China and other G20 members threatens progress. Read more

By Mohammad Zahoor of Istil Group and the Kyiv Post

I have been investing and doing business in Ukraine since its independence in 1991. I first arrived, aged 19, from Karachi on a scholarship to study metallurgy at Donetsk Technical University and after the break up of the Soviet Union stayed on and eventually invested $150m in Istil Ukraine, creating the most technically advanced steel facility in the CIS. I left the steel business in 2008, and today Istil Group is a Ukrainian conglomerate operating in many areas including real estate, media, manufacturing and coal enrichment.

Now, like many entrepreneurs in Ukraine I find myself depressed by the conflict, which potentially will cut GDP by 7 per cent this year and continues to cost lives every day. However, as an entrepreneur I am also excited by the investment opportunities in Ukraine. But for these opportunities to be fully realised it is essential that the pro-western parties who dominated last week’s parliamentary elections address the long-running issue of corruption. Read more

Do Brazilian voters care whether their politicians are corrupt? More particularly, do they care about political scandal at Petrobras, the state-controlled but publicly traded oil group that is both national champion and national treasure, a cherished symbol of Brazilian potential and prowess?

If you believe the latest opinion polls they either do care, in spades, or they don’t, not one bit. Read more

By Taras Kuzio of the University of Alberta

Petro Poroshenko, Ukraine’s president, has returned home after making emotional pleas for support to the Canadian and US legislatures, where he received sympathy and cash but no military assistance. Poroshenko faces deep-seated scepticism among western governments and experts over whether Ukraine’s leaders can overcome their differences, fight corruption and move beyond rhetoric to action in implementing long-overdue reforms. Read more

It is not news that under its ousted dictator, Zein al-Abidine Ben Ali (left), Tunisia was a kleptocracy, its heavily-regulated economy milked by the disgraced ruler, his extended family and others with political connections.

But now three years after the revolution which toppled Ben Ali, the World Bank says that restrictions on economic participation which blocked competitors and allowed his cronies to feather their nests are still in place. These continue to stifle the private-sector, ensuring that only a small number of people benefit at the expense of the majority of Tunisians. The result is poor economic growth and high youth unemployment –the very reasons which drove much of the discontent that led to the 2011 revolt against Ben Ali. Read more

By David McNair of the ONE Campaign

While the newswires are dominated by the threat of Isis, a critical opportunity to cut the support networks that fuel terrorism, criminality and tax evasion is passing unnoticed.

Terrorists rely on financial support – money channelled through the shadows of the western financial system. Secret companies and trusts, perfectly legal in many countries, allow criminals to fuel trillions of dollars through our financial system, evading tax while keeping their identities secret, building a virtual brick wall against law enforcement agents working to follow the money. Read more

An eccentric Indian tycoon, some of the world’s most luxurious hotels and now the Sultan of Brunei. The story of one Indian company’s tortuous journey out of legal hot water has just taken another twist.

The Sultan of Brunei has emerged as the lead bidder for the Grosvenor House Hotel and other luxury properties that India’s beleaguered Sahara group has been trying to sell off in a desperate attempt to get its ‘managing worker’ out of jail. Read more

In the past few decades, Ukraine has become one of the most corrupt countries in Europe. Many who protested against the regime of former president Viktor Yanukovich, deposed early this year, said that under his rule, corruption worsened dramatically.

Ukraine’s new authorities have assured voters they are ready to fight corruption. Donors such as the International Monetary Fund (IMF) have associated their financial support with Kiev’s anti-corruption measures.

So, what are the chances for success? Read more

By Mo Ibrahim of the Mo Ibrahim Foundation

As G7 leaders meet in Brussels, it’s worth reflecting for a moment on the changes that have occurred since last year’s summit. This year, the G8 will not meet against a backdrop of the Black Sea beaches of Sochi and Olympic glory, as planned. In fact, the G8 will not meet at all given international outrage over Russia’s action in Ukraine. Instead, the G7, sans Russia, will meet amid the medieval spires of Brussels.

The leaders’ agenda will doubtless focus on international crises. Tensions remain high in Ukraine following the Russian annexation of Crimea, and escalating terrorism impedes Nigeria’s path to development. In many ways, these crises are the by-products of corruption and the neglect of people’s fundamental rights, all of which have been allowed to fester in the global system. Read more

Anyone reading about Bangladesh would be forgiven for thinking it’s a one-industry country. And when it comes to exports, they wouldn’t be far wrong. More than three quarters of Bangladesh’s exports are of ready-made garments. The anniversary of the Rana Plaza disaster, in which more than 1,100 people died, has focussed attention on the industry’s dangers. But what is being done to move the economy away from sweat shop factories? Read more

The rise of the fledgling Aam Aadmi Party (AAP) in this general election has helped bring corruption and good governance into the spotlight. The two major parties, the ruling Congress and the opposition Bharatiya Janata Party (BJP) have put the issues front and centre of their campaigns.

But the corruption around electioneering itself seems to have increased – rather than decreased – this year with the usual reports of handouts ahead of voting all over the country. Read more

By Iftekhar Zaman, Transparency International, Bangladesh

One year ago today, three thousand garment workers started a typical work day at Rana Plaza in Bangladesh.

Like many of the country’s 4m garment workers – over 80 per cent of whom are young women – they earned just over one dollar a day for up to 19 hours of work; went without water or toilets; and crucially were not protected by basic workplace safety standards. They walked up one staircase: the only way in and out of the building. Read more