Tag Archives: corruption

Talking Trash in Lebanon

More than a week ago, the city of Beirut ceased trash collection when the landfill stopped accepting deliveries. It turns out the city’s biggest landfill is, well… full. Since then, the streets of this beautiful capital on the Mediterranean Sea have been filled with piles of garbage, rotting in the summer heat– 20,000 tons and counting. This creates obvious health hazards, and undercuts the city’s peak tourist season. Many residents are wearing masks to deal with the stench.

The Lebanese people are rightfully outraged. They see the garbage crisis as a manifestation of larger institutional failures. The country has been without a president for more than a year, and the parliament has extended its own mandate until 2017 without holding elections. The political deadlock breeds institutional paralysis, which in turn exacerbates corruption in a destructive cycle. Essential services like electricity, water, and, sure enough, waste removal are disrupted. CIPE’s longtime partner and Lebanon’s leading anti-corruption watchdog, the Lebanese Transparency Association (LTA), is not sitting idly by.

Read More…

Protest Movement Electrifies Armenian Civil Society

(Photo: BBC)

(Photo: BBC)

By Ann Mette Sander Nielsen

The Electric Yerevan protests began on June 19, when protesters gathered on the street to express their discontent with the local power company, the Electric Networks of Armenia (ENA) and its planned 14 percent increase in electricity tariffs from August, the third price raise within the past two years, which would result in a more than 60 percent overall increase in electricity tariffs.

Public discontent was further aggravated by a report revealing evidence of gross corruption and mismanagement at the utility. The report exposed the extravagant lifestyle of the ENA management and revealed that the ENA has accumulated debt by overpaying suppliers and contractors.

On June 23, four days after the start of the protests, roughly 2,000 protesters gathered on Baghramyan Avenue to express their grievances with the ENA management. They were blocked by police forces, and in response the protesters sat down and spent the night there. They were forcibly dispersed by police water cannons and around 250 people were detained.

Images, video clips and anecdotes about excessive police force circulated on social media under the hashtag #ElectricYerevan. The next day, around 4,000 protesters showed up on Baghranyan Avenue, and a few days later, the number of protesters peaked at 20,000.

The organizers of the protests developed guidelines for the protests, including a no alcohol policy, mutual respect, and tidiness, and organized a general assembly consisting of civic initiatives and working groups open to the public with the aim of discussing issues related to the protests. In Armenia, like many other countries, social media has become the main tool for producing a counter narrative to the state-owned media outlets and has allowed the distribution of ideas and the coordination of action and attention of participants.

After two weeks of protests, the police showed restraint while clearing Baghranyan Avenue on July 6. Perhaps the Armenian authorities had understood that police violence would only attract additional protesters, as it did on June 23. The effect of social media and the loose and horizontal structure of the Electric Yerevan protests made it difficult for the Armenian authorities to dismantle.

A reason for the loose and informal structure of the protests can be found in the non-democratic context under which protesters are forced to operate in Armenia. People are afraid to lose their jobs if they participate in more organized movements. In Armenia here is a general mistrust of NGOs and social movement organizations, which are traditionally more structured and technocratic. Civic initiatives like Electric Yerevan are more consensus-based and horizontal in their decision-making process and therefore seek to distance themselves from the NGOs, relying instead on street protests, occupations, or more creative forms of protests.

In fact, over the past few years, protests by civic initiatives have been frequent. Although civic initiatives in Armenia usually address very specific issues, they symbolize the display of informed grievances concerning corruption, government mismanagement, and the absence of rule of law and democracy. The size of the Electric Yerevan protests made it different from the previous protests. Perhaps Electric Yerevan has given renewed power to Armenian civil society to make demands from its government.

Ann Mette Sander Nielsen is a Eurasia intern at CIPE.

Carrying Crude Oil to Newcastle: The Resource Curse Strikes Again in Nigeria

Source: Newswire NGR

Source: Newswire NGR

By Otito Greg-Obi

On May 20th, 2015 the lights went out in Nigeria, Africa’s biggest oil producer. Nigeria suffers from a phenomenon known as the curse of oil which is a subset of a larger issue known as the resource curse. The idea behind the curse of oil is that countries with large oil reserves cannot seem to manage revenues in a way that benefits the majority of the population economically and socially. Some of the symptoms of the curse of oil include lack of economic diversification, revenue volatility, inability to provide public goods and services, corruption, government inefficiency and the Dutch Disease.

As soon as the massive fuel shortage in Nigeria struck, numerous businesses and banks shut down. Power outages also affected common households because neighborhoods are typically powered by individually owned generators due to inconsistent provision of public utilities. As soon as licensed gas stations closed down, black market vendors looking to make a quick Naira (Nigeria’s currency) began selling low quality oil at exorbitant prices. The shortage exemplifies the curse of oil by revealing an inability to provide a crucial public good. Furthermore, the shortage unveils the existence of corruption in black market practices.

Oil importers shut down operations claiming that the government owed them $2 billion. Nigeria’s Minister of Finance Okonjo-Iweala countered that importers misrepresented the debt in an attempt to recover lost revenue from the recent decrease in value of the Naira due to global declining oil prices. The global decrease of oil prices is a perfect example of the volatility that comes with the curse of oil and how it can complicate economic transactions between the governments and oil corporations.

Fortunately, oil suppliers and distributors eventually met with the government for negotiations that put an end to the crisis. The specifics of the negotiations have not been revealed but it appears that the crisis has been averted for now. But as global oil prices continue to decline, economic shocks are imminent. What will the government do to thwart the curse of oil?

Read More…

Will Decentralization Lead to More Corruption in Cambodia?


Watch a short video about the Silaka project.

In 2009, Cambodia’s provincial legislatures became elected bodies for the first time in the country’s history. Against the backdrop of decentralization, this newly democratic level of government is also being called upon to handle a greater share of public service delivery. If they fail to perform, and if their increased budgets result in a dramatic expansion of corruption, democracy could be seen as failing to perform.

Provincial governments currently account for approximately 20 percent of all public sector spending in Cambodia, up from nearly zero in the late 1990s. This figure will continue to rise as provincial governments increasingly bear the financial burden of primary and secondary education, public health and sanitation, local transportation infrastructure, and basic public administration.

To help mitigate corruption risks, there is a need for greater transparency in provincial finances, increased civic involvement in provincial procurement processes, and good governance advocacy at the local level of government. To address this challenge, CIPE launched an innovative project in June 2012 with a Cambodian NGO called Silaka to reduce corruption in provincial government procurement.

Read More…

Supporting Small Business in Ukraine

10888372_806125889443466_7958027880447968046_n

More than a year after the EuroMaidan protests took the world by surprise, Ukraine’s political and economic struggles continue. Developments in the country since the new government came to power highlight the ongoing challenges of systemic overhaul following an exciting, rapid transition. These challenges clearly illustrate the link between democratic development and economic reform, so central to CIPE’s work. Accomplishing the tasks facing Ukraine, from combating corruption, to reducing the barriers to doing business, to creating space for public-private dialogue, will be no easy feat.

The success of Ukraine’s economic and democratic development largely depends on ensuring the success of the country’s small and medium-sized enterprises (SMEs). The entrepreneurial and flexible nature of SMEs makes them integral to achieving a number of the country’s goals: economic diversification; closer integration with Europe; building an adaptable economy; stimulating job growth; and boosting productivity.

Ukraine thus seeks to emulate the ways in which SMEs have helped make the U.S. economy among the world’s most successful. Boosting SMEs will require both giving the business community – and SMEs in particular – a seat at the policymaking table, and providing these firms with extensive support and training. CIPE’s partners are playing an important role in both of these processes.

CIPE’s primary focus in Ukraine has been to reduce policy barriers to business through cross-regional advocacy. Since opening the Kyiv office in 2010, CIPE has developed an extensive network of partner business associations and chambers of commerce across the country that work to represent and support Ukraine’s citizens through the work that they do.

Read More…

Public Procurement: The Nexus of Public and Corporate Governance in Combating Corruption

ampliamento_canale_di_panama_01_1

Governments around the world spend trillions on public procurement each year for everything from office supplies to military equipment to infrastructure megaprojects like this $5 billion Panama Canal expansion.

 

By Kirby Bryan

For over a decade, the World Bank Group’s Doing Business index has served as quintessential tool for determining how well a country’s institutional infrastructure is suited to the promotion of a productive business environment. But something was missing. Businesses and governments interact on levels beyond permitting and regulation: the public sector can also be a client.

Public procurement can provide opportunities for corruption. When seeking lucrative public contracts, companies look for any opportunity they can take advantage of that will improve their ability to secure a successful bid. Unscrupulous government officials can use their influential positions to attain favors and gifts from businesses pursuing public procurement tenders.

In March 2015, the World Bank Group, in conjunction with the George Washington University Law School, held a release event for the first installment of its Benchmarking Public Procurement Index

Read More…

What Drives Corruption and How Can Institutions Respond?

UNCAC

What are the drivers of and institutional responses to corruption? Are current anti-corruption instruments used domestically and internationally effective? These were the key questions of a fascinating day-long event organized last week in Washington, DC by the George Washington School of Law and the International Bar Association, among others.

The event gathered a distinguished group of speakers from the government, academia, international organizations, law firms, and non-profits, as well as an engaged audience of anti-corruption scholars and practitioners.

While the discussion touched upon a multitude of corruption-related topics, the following aspects of corruption raised at event were the most valuable insights for me:

  • Corruption as a violation of public trust. Janine Wedel, a Berkeley-trained anthropologist and a professor at George Mason University, emphasized that corruption is more than just simple quid pro quo. Instead, it is a sophisticated network rooted in informal power, influence elites, and often aided by the post-Cold War global economic openness as the revolution of the digital age.
  • Corruption as a governance problem. Nikos Passas, professor at the Northeastern University, pointed out the roots of corruption in discrepancies between legitimacy and legality (lawful but awful conduct by government officials or businesses) and in unlawful but useful behavior (e.g., bribing a doctor to treat a patient in a failing healthcare system). International norms such as the United Nations Convention Against Corruption help by creating agreed-upon legal standards, but improving on-the-ground governance in countries around the world still has a long way to go. Read a Q&A with Nikos Passas here.
  • Private sector as a force for anti-corruption. Baker & McKenzie’s Tom Firestone stressed that a broad-based business community in a given country can be an effective force in anti-corruption efforts. He recounted his experience in Russia where local businesses resisted corrupt encroachments of the state. Local firms, after all, have a strong interest in the rule of law and a level playing field in the business environment. But they can’t do it alone.
  • Inter-governmental cooperation makes a difference. Kathryn Nickerson, Senior Counsel at the Department of Commerce highlighted the importance of the Organisation for Economic Co-operation and Development (OECD) Working Group on Bribery in International Business Transactions responsible for monitoring and implementation of the OECD Anti-Bribery Convention.
  • Corruption as an attack on human dignity. Sarah Chayes, the conference’s keynote speaker, talked about her recently published book, Thieves of State: Why Corruption Threatens Global Security. She pointed out that there is a moral dimension to corruption – it leads to widespread moral decay and individual humiliation that goes beyond money. In extreme cases of corruption-ridden countries, it is not the weakness of the state that leads to corruption. Rather, the institutions of the state have evolved to make them a conduit for corruption that permeates entire societies.

Anna Nadgrodkiewicz is Director for Multiregional Programs at CIPE.