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Fighting corruption in the developing countries
Irène Hors
Development Centre
The fight against corruption is not the monopoly of the industrialised countries. Nor can recipes
that have worked in OECD countries necessarily be applied to developing ones.
Of the 134 countries that attended the 9 th International Anti-Corruption Conference organised
by Transparency International in Durban last October, over a hundred were developing countries.
More and more of these countries are expressing their resolve to combat corruption, echoing
international initiatives, such as the OECD Convention.
Despite the real efforts made, there has been little concrete progress to date. In most developing
countries today, corruption is widespread and part of everyday life. Society has learned to live
with it, even considering it, fatalistically, as an integral part of their culture. Not only are public
or official decisions – for instance, on the award of government contracts or the amount of tax
due – bought and sold, but very often access to a public service or the exercise of a right, such as
obtaining civil documents, also has to be paid for.
Several mechanisms help to spread corruption and make it normal practice in these countries.
Civil servants who refuse to toe the line are removed from office; similarly, businessmen who
oppose it are penalised vis-à-vis their competitors. Furthermore, an image of the state has grown
up over the years according to which the civil service, far from being a body that exists to
implement the rights of citizens – rights that mirror their duties – is first and foremost perceived
as the least risky way of getting rich quickly. All of which helps to make corruption seem
normal.
In practice, it is the environment in which public servants and private actors operate that causes
corruption. Public administration in developing countries is often bureaucratic and inefficient.
And a large number of complex, restrictive regulations coupled with inadequate controls are
characteristic of developing countries that corruption helps to get around.
But to understand corruption, institutional analysis is not enough. A political and economic
analysis is important too. Whether it be in Benin, Bolivia, Morocco, Pakistan or the Philippines –
five countries examined in a study by the OECD Development Centre and the UN Development
Programme – corruption is closely linked to the type of government involved.
The link between political and economic power can be direct. There is patrimonialism, as in
Morocco, where access to political power ensures access to economic privileges. The link can be
indirect too, as in the Philippines, where political power, such as a privileged position in a
patronage-based system, can be bought and sold. In short, the process of allocating political and
administrative posts – particularly those with powers of decision over the export of natural
resources or import licences – is influenced by the gains that can be made from them. And the
political foundations are cemented as these exchanges of privileges are reciprocated by political
support or loyalty.
Feeding underdevelopment
Another feature common to the countries studied is their underdevelopment, which is conducive
to corruption. In fact, underdevelopment encourages corruption. How is this? First of all, low
wages in the civil service encourage petty corruption, and the imbalance between the supply of,
and demand for, public services likewise creates opportunities for corruption. Also, individuals
tend to invest in a career in the public service, given the shortage of opportunities in the private
sector, thus increasing the likelihood of their involvement in corrupt practices. Another reason is
that the low level of education found in underdeveloped countries maintains citizens in a state of
ignorance of their rights, barring them from participating in political life.
Institutional analysis of corruption indicates where the remedies lie. Greater transparency,
accountability and merit-based human resource management in public administration are
principles which, if implemented, make it possible to curb corruption. Simplification of state
intervention in economic activity also helps. A study of the customs administration in Senegal
found, using econometric tests, that a reduction in import taxes, simplification of their structure,
implementation of reforms reducing the discretionary powers of customs officials and
computerisation of procedures helped to reduce the level of fraud by 85% between 1990 and
1995.
But identifying the direction that reforms should take is only part of the task. The main difficulty
lies in implementing them. This requires a strategy that really is operational. Two kinds of
obstacles are usually encountered. The first is economic. While underdevelopment does not
inevitably generate corruption, underdeveloped countries do not have the same means as more
advanced ones to escape it. It is difficult to replicate the strategy adopted in Hong Kong, for
instance, which involved the creation of an investigative agency with a large staff and plentiful
funds (see box). The fight against corruption must therefore be based on the development
process itself.
The second kind of obstacle is political. Many politicians owe their careers and status to
corruption and few of them, if any, will take a stand against it, either for fear of upsetting their
own careers or the political status quo generally.
Civil society and the media can help by denouncing corruption and putting pressure on the
government. But the real impediments to the fight against corruption are as much the interests of
the politico-administrative apparatus as the fatalism and ignorance of the victims, maintained by
a culture of fear nurtured by those who benefit from corruption. But before one can act, it is
necessary to be informed. That is why research into the incidence of corruption and its effects is
so important. Only on that basis can action by civil society and aid agencies be guided.
The private sector can also make an important contribution to the fight against corruption, by
policing its own codes of conduct and sticking to high standards of governance. International and
regional organisations can also help, as can bilateral aid agencies, via programmes to strengthen
institutional capacity, and of course by ensuring the transparency of the projects they support.
One thing is sure: the problem of corruption in the developing countries cannot be solved simply
by applying anti-corruption structures that work in OECD countries. The experience the latter
countries have acquired in terms of legislation, public procurement codes and control procedures,
for example, is valuable, but it is just a technical element in a much more complex process of
change. A reduction in corruption depends on economic development. It is thus for each country
concerned to draw up its own strategy, by which it can then lead to a virtuous circle of
development and good governance.
Bibliography
Stasavage, David and Daubrée, “Determinants of Customs Fraud and Corruption: Evidence
from Two African Countries”, Technical Paper No 138, OECD Development Centre, August
1998.
Hors, Irène, Fighting Corruption in Developing Countries and Emerging Economies: the Role
of the Private Sector, study by the OECD Development Centre, to be published.
©OECD Observer No 220, April 2000
Economic data
GDP growth: +0.5% Q3 2018 year-on-year
Consumer price inflation: 2.1% Jan 2019 annual
Trade: +0.3% exp, +0.7% imp, Q2 2018
Unemployment: 5.3% Jan 2019
<a href="https://data.oecd.org/chart/5o9i" target="_blank">OECD Chart: Composite leading
indicator (CLI), Amplitude adjusted, Long-term average = 100, Monthly, May 2015 &ndash;
latest</a>
Last update: 12 Mar 2019
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Instagram Home Sections » General » Countries » Data » People & events » Archive » Stay with
our March on Gender here Fighting corruption in the developing countries Irène Hors
Development Centre The fight against corruption is not the monopoly of the industrialised
countries. Nor can recipes that have worked in OECD countries necessarily be applied to
developing ones. Of the 134 countries that attended the 9 th International Anti-Corruption
Conference organised by Transparency International in Durban last October, over a hundred
were developing countries. More and more of these countries are expressing their resolve to
combat corruption, echoing international initiatives, such as the OECD Convention. Despite the
real efforts made, there has been little concrete progress to date. In most developing countries
today, corruption is widespread and part of everyday life. Society has learned to live with it, even
considering it, fatalistically, as an integral part of their culture. Not only are public or official
decisions – for instance, on the award of government contracts or the amount of tax due – bought
and sold, but very often access to a public service or the exercise of a right, such as obtaining
civil documents, also has to be paid for. Several mechanisms help to spread corruption and make
it normal practice in these countries. Civil servants who refuse to toe the line are removed from
office; similarly, businessmen who oppose it are penalised vis-à-vis their competitors.
Furthermore, an image of the state has grown up over the years according to which the civil
service, far from being a body that exists to implement the rights of citizens – rights that mirror
their duties – is first and foremost perceived as the least risky way of getting rich quickly. All of
which helps to make corruption seem normal. In practice, it is the environment in which public
servants and private actors operate that causes corruption. Public administration in developing
countries is often bureaucratic and inefficient. And a large number of complex, restrictive
regulations coupled with inadequate controls are characteristic of developing countries that
corruption helps to get around. But to understand corruption, institutional analysis is not enough.
A political and economic analysis is important too. Whether it be in Benin, Bolivia, Morocco,
Pakistan or the Philippines – five countries examined in a study by the OECD Development
Centre and the UN Development Programme – corruption is closely linked to the type of
government involved. The link between political and economic power can be direct. There is
patrimonialism, as in Morocco, where access to political power ensures access to economic
privileges. The link can be indirect too, as in the Philippines, where political power, such as a
privileged position in a patronage-based system, can be bought and sold. In short, the process of
allocating political and administrative posts – particularly those with powers of decision over the
export of natural resources or import licences – is influenced by the gains that can be made from
them. And the political foundations are cemented as these exchanges of privileges are
reciprocated by political support or loyalty. Feeding underdevelopment Another feature common
to the countries studied is their underdevelopment, which is conducive to corruption. In fact,
underdevelopment encourages corruption. How is this? First of all, low wages in the civil service
encourage petty corruption, and the imbalance between the supply of, and demand for, public
services likewise creates opportunities for corruption. Also, individuals tend to invest in a career
in the public service, given the shortage of opportunities in the private sector, thus increasing the
likelihood of their involvement in corrupt practices. Another reason is that the low level of
education found in underdeveloped countries maintains citizens in a state of ignorance of their
rights, barring them from participating in political life. Institutional analysis of corruption
indicates where the remedies lie. Greater transparency, accountability and merit-based human
resource management in public administration are principles which, if implemented, make it
possible to curb corruption. Simplification of state intervention in economic activity also helps.
A study of the customs administration in Senegal found, using econometric tests, that a reduction
in import taxes, simplification of their structure, implementation of reforms reducing the
discretionary powers of customs officials and computerisation of procedures helped to reduce the
level of fraud by 85% between 1990 and 1995. But identifying the direction that reforms should
take is only part of the task. The main difficulty lies in implementing them. This requires a
strategy that really is operational. Two kinds of obstacles are usually encountered. The first is
economic. While underdevelopment does not inevitably generate corruption, underdeveloped
countries do not have the same means as more advanced ones to escape it. It is difficult to
replicate the strategy adopted in Hong Kong, for instance, which involved the creation of an
investigative agency with a large staff and plentiful funds (see box). The fight against corruption
must therefore be based on the development process itself. The second kind of obstacle is
political. Many politicians owe their careers and status to corruption and few of them, if any, will
take a stand against it, either for fear of upsetting their own careers or the political status quo
generally. Civil society and the media can help by denouncing corruption and putting pressure on
the government. But the real impediments to the fight against corruption are as much the
interests of the politico-administrative apparatus as the fatalism and ignorance of the victims,
maintained by a culture of fear nurtured by those who benefit from corruption. But before one
can act, it is necessary to be informed. That is why research into the incidence of corruption and
its effects is so important. Only on that basis can action by civil society and aid agencies be
guided. The private sector can also make an important contribution to the fight against
corruption, by policing its own codes of conduct and sticking to high standards of governance.
International and regional organisations can also help, as can bilateral aid agencies, via
programmes to strengthen institutional capacity, and of course by ensuring the transparency of
the projects they support. One thing is sure: the problem of corruption in the developing
countries cannot be solved simply by applying anti-corruption structures that work in OECD
countries. The experience the latter countries have acquired in terms of legislation, public
procurement codes and control procedures, for example, is valuable, but it is just a technical
element in a much more complex process of change. A reduction in corruption depends on
economic development. It is thus for each country concerned to draw up its own strategy, by
which it can then lead to a virtuous circle of development and good governance. Bibliography
Stasavage, David and Daubrée, “Determinants of Customs Fraud and Corruption: Evidence
from Two African Countries”, Technical Paper No 138, OECD Development Centre, August
1998. Hors, Irène, Fighting Corruption in Developing Countries and Emerging Economies: the
Role of the Private Sector, study by the OECD Development Centre, to be published. ©OECD
Observer No 220, April 2000 Economic data GDP growth: +0.5% Q3 2018 year-on-year
Consumer price inflation: 2.1% Jan 2019 annual Trade: +0.3% exp, +0.7% imp, Q2 2018
Unemployment: 5.3% Jan 2019 Last update: 12 Mar 2019 Related articles News Brief - October
2008 News Brief - January 2008 The OECD Anti-Bribery Convention 10 years on News brief October 2007 Innovation: Not all peaches and cream E-Newsletter Stay up-to-date with the latest
news from the OECD by signing up for our e-newsletter : Twitter feed Suscribe now
<b>Subscribe now!</b> To receive your exclusive paper editions delivered to you directly
Online edition Previous editions Don't miss Food production will suffer some of the most
immediate and brutal effects of climate change, with some regions of the world suffering far
more than others. Only through unhindered global trade can we ensure that high-quality,
nutritious food reaches those who need it most, Angel Gurría, Secretary-General of the OECD,
and José Graziano da Silva, Director-General of the United Nations Food and Agriculture
Organization, write in their latest Project Syndicate article. Read the article here. Globalisation
will continue and get stronger, and how to harness it is the great challenge, says OECD
Secretary-General Gurría on Bloomberg TV. Watch the interview here. OECD SecretaryGeneral Angel Gurría with UN Secretary-General António Guterres at the 73rd Session of the
UN General Assembly, in New York City. The new OECD Observer Crossword, with Myles
Mellor. Try it online! Watch the webcast of the final press conference of the OECD annual
ministerial meeting 2018. Listen to the "Robots are coming for our jobs" episode of The
Guardian's "Chips with Everything podcast", in which The Guardian’s economics editor, Larry
Elliott, and Jeremy Wyatt, a professor of robotics and artificial intelligence at the University of
Birmingham, and Jordan Erica Webber, freelance journalist, discuss the findings of the new
OECD report "Automation, skills use and training". Listen here. Do we really know the
difference between right and wrong? Alison Taylor of BSR and Susan Hawley of Corruption
Watch tell us why it matters to play by the rules. Watch the recording of our Facebook live
interview here. Has public decision-making been hijacked by a privileged few? Watch the
recording of our Facebook live interview with Stav Shaffir, MK (Zionist Union) Chair of the
Knesset Committee on Transparency here. Can a nudge help us make more ethical decisions?
Watch the recording of our Facebook live interview with Saugatto Datta, managing director at
ideas42 here. The fight against tax evasion is gaining further momentum as Barbados, Côte
d’Ivoire, Jamaica, Malaysia, Panama and Tunisia signed the BEPS Multilateral Convention on
24 January, bringing the total number of signatories to 78. The Convention strengthens existing
tax treaties and reduces opportunities for tax avoidance by multinational enterprises. Rousseau
Do you trust your government? The OECD’s How's life 2017 report finds that only 38% of
people in OECD countries trust their government. How can we improve our old "Social
contract?" Read more. Globalisation’s many benefits have been unequally shared, and public
policy has struggled to keep up with a rapidly-shifting world. The OECD is working alongside
governments and international organisations to help improve and harness the gains while
tackling the root causes of inequality, and ensuring a level playing field globally. Please watch.
Checking out the job situation with the OECD scoreboard of labour market performances: do
you want to know how your country compares with neighbours and competitors on income
levels or employment? Trade is an important point of focus in today’s international economy.
This video presents facts and statistics from OECD’s most recent publications on this topic. The
OECD Gender Initiative examines existing barriers to gender equality in education, employment,
and entrepreneurship. The gender portal monitors the progress made by governments to promote
gender equality in both OECD and non-OECD countries and provides good practices based on
analytical tools and reliable data. Interested in a career in Paris at the OECD? The OECD is a
major international organisation, with a mission to build better policies for better lives. With our
hub based in one of the world's global cities and offices across continents, find out more at
www.oecd.org/careers . Visit the OECD Gender Data Portal. Selected indicators shedding light
on gender inequalities in education, employment and entrepreneurship. Most Popular Articles 7
days 14 days 1 month Going digital: Back to the future Why quotas work for gender equality
How tax can reduce inequality An emerging middle class Sustainable solutions for radioactive
waste OECD Observer Roundtable on Finland Jobs, unemployment and government action Cool
generation Education in Japan: Learning to change When the going gets easier OECD Insights
Blog From analysis to action: Multidimensional country reviews Are you in the 1% 2016: CSR
is dead! What's next? COP21 was decades in the making, so how do we make future decades
work for climate? Fostering inclusive growth: A golden opportunity to put future growth on a
socially sustainable footing Turning the tide towards inclusiveness
MobileSubscribeAbout/ContactAdvertiseFrançaisBack to the top NOTE: All signed articles in
the OECD Observer express the opinions of the authors and do not necessarily represent the
official views of OECD member countries. All rights reserved. OECD 2019 OECD.ORG
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