Corruption stubbornly high after a decade-long fight


Washington : Global efforts to cut corruption and improve government quality have made little progress in the last 10 years, despite bright spots mainly in Africa and Eastern Europe, the World Bank said.

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The aid agency's global governance report for 2006, released Tuesday, suggested that several regions are stagnating in the fight against graft, including Asia, Latin America and the rich nations of the Organisation for Economic Cooperation and Development (OECD).

"On an average, we do not have evidence around the world that governance has improved significantly" since the bank's first report in 1996, said Daniel Kaufmann, a World Bank economist who co-wrote the survey.

"We see a flat picture, which is quite sobering," he told reporters.

The World Bank says companies and individuals pay an estimated $1 trillion in bribes annually, hurting poor people and discouraging investment that otherwise might boost prosperity.

On the positive side, "there is a large number of countries that are showing that in 8-10 years it is possible to significantly improve governance", Kaufmann said.

The survey moulds indicators such as political stability, democracy, business environment and corruption into an annual snapshot of how the world's 6.6 billion people are governed.

Eastern Europe and the Baltics have made progress against corruption, but since 2004 lost some gains in the quality of business regulations, the report said.

Finland and Singapore won top honours in fighting corruption. Denmark also won consistently high marks for governance among rich nations, while former Soviet states Ukraine, Armenia and Georgia made dramatic gains in the past five years.

Some African countries are making strides toward good governance, including Kenya, Ghana, Algeria, Sierra Leone and Tanzania, but "other African countries still face enormous government and development challenges", a summary of the report said.

The World Bank, which lends some $23 billion a year for aid projects, began highlighting corruption as a drain on development and investment in the 1990s.

Although former World Bank head Paul Wolfowitz ruffled feathers by linking some loans to countries' anti-graft efforts, the issue remains at the top of the bank's agenda.

"But to think somehow a few aid donors can get together and generate worldwide improvements in governance is a bit too hopeful", said report co-author Aart Kraay.

The report showed emerging economies catching up with rich nations. More than a dozen countries, most of them in formerly communist eastern Europe, scored higher on key measures of governance than countries such as Greece and Italy.

Slovenia, Estonia and Hungary got some of the highest scores in eastern Europe, while Chile, Uruguay and Costa Rica got high marks in Latin America.

Yet Brazil, Latin America's largest economy, has backtracked on core economic measures of governance since about 2003, the report showed.

China has improved its anti-corruption stand and the rule of law but civil freedoms and political stability declined, the World Bank found.

Also in Asia, Hong Kong managed to improve its already excellent anti-graft record last year. Singapore ranked just ahead, though its rating for political freedoms declined since 2004.

Taiwan, South Korea and Malaysia also ranked high in fighting corruption and regulatory quality.

In the Middle East, the United Arab Emirates and Israel ranked highest in controlling corruption and providing favourable regulations for business. Other Gulf states came in next, followed by Jordan, Tunisia and Saudi Arabia.

In Europe, Denmark led in four categories, including rule of law. Finland topped the survey's two other measures, among them fighting graft. Italy and Greece generally ranked at the bottom of the scale.

The survey combines data from 33 publicly available sources to calculate worldwide governance indicators.