Business World

Tuesday 23 January 2018

Greece named ‘most corrupt’ EU nation but Ireland’s reputation also takes a battering

Gareth Jones

Greece has been named the most corrupt country in the EU but Ireland’s ranking has also worsened, according to a new study of ‘perceived graft’ at official level.

Ireland slipped to 25th in 2012 from 19th last year in the global index of least state sector corruption, published by watchdog Transparency International (TI) today, putting us behind the likes of Uruguay.

Berlin-based TI urged European and other governments to try much harder to turn promises of fighting graft into action in areas such as public tenders, political party financing and tax evasion.

"The results of the survey should be a warning signal for the EU to require more information and accountability from its member states," said TI's EU analyst Jana Mittermaier, adding that this should apply also to current efforts to establish European banking oversight.

Weak or inefficient judicial systems, poor public audit services and cosy ties between government and business all contribute to perceptions of corruption in some European countries, she said.

TI's index, which this year ranks 176 countries, measures perceptions of graft rather than actual levels due to the secrecy that surrounds most corrupt dealings.

Greece took 94th place, below the poorer, newer democracies such as Bulgaria and Romania. Italy was placed 72nd, just ahead of Bulgaria at 75th but behind Romania on 66th.

In the 2011 index, Greece was 80th with Bulgaria scoring worst among the EU nations in 86th place.

Greeks have long complained about corruption but anger has soared, particularly about tax evasion among the rich, as the government has imposed wave after wave of austerity that the country's international lenders have demanded.

The EU has kept Bulgaria and Romania out of its Schengen zone, which allows passport-free travel between member states, due to concerns about corruption. A recent study showed Bulgarians gave about 150,000 bribes to civil servants every month last year, more than in 2010.

Portugal was placed 33 in the table.

TI cautioned that the 2012 rankings did not entirely reflect relatively recent developments such as the advent of a reform-minded Italian government because some of the research shaping the index dated back more than a year.

TI said there was a stronger public recognition worldwide, including in big emerging "BRIC" economies such as China and Brazil, of the costs of corruption and a growing refusal to accept it as an inevitable fact of life.

"Today corruption is the world's most talked about social problem. It is very positive that people around the world are demanding more accountability... This could be a big game changer," TI Managing Director Cobus de Swardt said.

New Zealand, Denmark and Finland vied for the overall top slot as being perceived as the least corrupt countries, while Somalia, North Korea and Afghanistan shared last place.

Among the major global economies, the United States ranked 19, up from 24, Germany was at 13, up from 14, Japan and Britain tied for 17th place and France was at 22, up from 25 last year.

Swardt said it was worrying that two thirds of all countries surveyed ranked below 50 on TI's new scale where 100 is perceived as most clean and 0 most corrupt. "It is widely recognised today that high levels of corruption in the public sector have hampered the global economic recovery," he said.

Corruption has become a hot political issue fuelling protests from China and Russia to the Arab world.

China saw its ranking slip to 80 from 75 last year, but Swardt said the Beijing leadership showed a greater understanding of the dangers of ignoring corruption, including among Chinese companies operating both at home and abroad.

Last month, state media quoted Communist Party chief Xi Jinping as saying that if corruption was allowed to run wild, the Communist Party risked major unrest and the collapse of its rule.

Swardt drew comparisons with standards in the Organisation for Economic Cooperation and Development, which groups wealthy nations. "We have seen a criminalisation of bribery to the standards of the OECD," he said.

"The Chinese used to say their companies could not be held to rich country standards because they needed to catch up, but now they realise tackling this is in their own interests."

But tackling corruption in a lasting way required allowing ordinary citizens the power to scrutinise public services and institutions, he added.

Elsewhere among the so-called BRICs, Swardt said Russia's new restrictions on non-governmental organisations would make it harder to monitor and check corruption. Russia ranks 133rd in the 2012 global rankings, up from 143 last year.

With Russia taking on the rotating presidency of the Group of 20 leading economies, Moscow should try to "lead by example and not by the lowest common denominator in terms of bribery", Swardt said.

Political will has a big role to play in determining whether a country moves up or down the corruption rankings, Swardt said. "Those countries stuck at the bottom are often those where political elites are very unwilling to tackle the issues in a serious manner," he said.

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