By Tirthankar Mukherjee
Careful readers will find on another page of this issue a quote from the indefatigable anti-corruption crusader, President Ts. Elbegdorj, “Corruption makes Mongolia look awful, ugly.” I have always found it extraordinarily courageous of him to be so blunt about this festering sore on the country’s body politic. Pride in the past usually makes us more touchy about the present, and a mindset reared on memories, some more mythical than others, of glory tends to condone unsavoury aspects of the present as historical aberrations, inevitable accretions of multi-pronged exploitation and denial.Mongolians are not alone in this ambivalence about their perceived national warts, as I know very well as an Indian.
Most Mongolians, I’d think, agree with their President at heart, but the truth hurts more when it comes from outsiders and/or is doled out with some condescension from a holier-than-thou pulpit. I have several times written in this column that corruption – particularly its most popular manifestation, bribing to get something done (or not done) – is always a bilateral transaction, and has to be seen as one. Like the chicken and the egg, it is difficult to ascertain which came first, the demand or the offer. There can be no doubt, however, that one cannot exist without the other, and this is why I always resent the smugness which implies that the bribe taker is the sole offender, forcing the pure-as-the-driven-snow investor/entrepreneur -- who is mainly from the developed countries – to abandon ethics to help the local economy grow.
The naivetй of putting all the blame on venal third world bureaucrats and politicians was brought to me earlier this month in a report by Suzanne Daley in The New York Times, appearing under the headline “So Many Bribes, a Greek Official Can’t Recall Them All”. Datelined Athens, it begins thus, “When Antonis Kantas, a deputy in the Defense Ministry here, spoke up against the purchase of expensive German-made tanks in 2001, a representative of the tank’s manufacturer stopped by his office to leave a satchel on his sofa. It contained 600,000 euros, about $814,000. Other arms manufacturers eager to make deals came by, too, some guiding him through the ins and outs of international banking and then paying him off with deposits to his overseas accounts.
“At the time, Mr. Kantas, a wiry former military officer, did not actually have the authority to decide much of anything on his own. But corruption was so rampant inside the Greek equivalent of the Pentagon that even a man of his relatively modest rank, he testified recently, was able to amass nearly $19 million in just five years on the job.”
Kantas’s confessions threw open a wide window on the eye-popping system of payoffs at work inside a Greek ministry. He repeatedly pleaded that he had taken so many bribes he could not possibly remember all their details, but whatever he remembers, or chooses to tell, bolsters the belief that it was unchecked graft that helped plunge Greece into its current crisis. However, Kantas’s testimony – and I have to make it clear that I do not have access to any corroboration of his claims, so technically they are just his words – also illustrates how arms makers from Germany, France, Sweden and Russia passed out bribes liberally to sell the Greek government weaponry that it could ill afford and that experts say was in many cases overpriced and subpar.
Such scenarios play out after any major weapons purchase by a developing country, whose functionaries are predictably termed corrupt, but not the agents of the manufacturers, from such scrupulously honest and ethical-practice countries as, say Germany and Sweden. In this case, there is no question that the Greek system was rotten, but the sellers showed no qualms in bribing officials and lending money to an almost bankrupt country so they could sell their products!
This report appeared only days after the European Commission had released a report that said, in simple and unequivocal terms, that there are no corruption-free zones in Europe. Indeed, corruption in the 28 countries of the EU is costing European taxpayers about €120billion a year, or roughly $162 billion. This is almost certainly too conservative an estimate. The figure is equivalent to the bloc’s annual budget and is about 1 percent of the €11.7 trillion gross domestic product of the EU.
The report was not an attempt to gauge the scale of sleaze in the EU apparatus but only in individual member countries.The release of the report was accompanied by two opinion polls which showed that more than 56% of people thought corruption was growing in recent years in their countries, an increase from 47 percent the last time such a study was conducted, three years earlier. Three out of four saw sleaze as widespread, and more than four out of five Europeans believe “too-close links between business and politics” are a major source of problems.
Corruption prevention and prosecution for criminal cases are the remit of national governments, but the report, purely advisory and analytical, did say, “Declared intentions are still too distant from concrete results. Genuine political will to eradicate corruption often appears to be missing.” We should be proud of President Elbegdorj.
The report singled out the UK as among the countries with the strongest anti-bribery rules in the world, but it also called for a ger crackdown on UK firms bribing their way into contracts abroad.While Scandinavia, Britain and Luxembourg emerged as the most bribery-free zones in the EU, southern Europe – Greece, Italy and Spain – and parts of eastern Europe were found to be the most vulnerable. About 8% of Europeans said they had experienced or witnessed a case of corruption in the past 12 months. The report focused on political sleaze, on malpractice in business and on corruption in public procurement, which takes up a fifth of the EU gross domestic product, and was especially dirty, with up to half the cost of public contracts being due to corruption. Health services, building and urban development are sectors where corruption vulnerabilities are usually high across the EU, the report said.
The absence of any specific case study makes comparisons difficult but the contours of the situation in Mongolia and the EU are not so different that we cannot see a kettle-pot relationship. And how will things get better?Carl Dolan, Director, Transparency International EU Office, calls the report“ a stark warning that much more needs to be done by all Member States, both ‘new’ and ‘old’ (that includes your, too, Sweden, Denmark and Finland!).” He reminds us of TI’s own findings a couple of years ago that across the EU there are systematic corruption risks and governance failings in such areas as party financing and whistleblower protection.
Dolan feels a major theme that emerges from the report is failure on the part of politicians to self-regulate, in particular to regulate the conflicts of interest that are a consequence of their dealings with and involvement in business. This, too, is familiar ground for Mongolians. Cash kickbacks are usually one-time deals but a more insidious and longer-term corruption risk is the “revolving door” relationship between investor and regulator, again well-known here.
So Mongolia is not alone in what President Elbegdorj sees as its ‘ugliness’, as he, and most of his countrymen, wonder if the solitary grandeur of ‘beauty’ in this context can ever be enjoyed.