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the October 2001 issue of World Press Review
Accessories to the Crimes
Hypocrisy Surrounds Bribery Issue
Richard Gwyn, The Toronto Star
(liberal), Toronto, Canada, July 18, 2001.
We are pure. They are corrupt. We live by the rule
of law. They live by the code of connections or cronyism. We, as a
consequence, are rich, thoroughly deservedly, while they, equally
deservedly, are poor. All of that exaggerates reality, but it isnt
that far from the way we view the world. Our creed: Out of purity
comes profits. For over a decade now, with the United States in the
lead, industrial nations have been trying to extend our way of doing
businesslegally binding contracts, transparency, impartial courtsto
the rest of the world.
When East Asia went into a financial crash in 1998 and 1999, the almost
universal analysis was that these countries had brought it on themselves
by crony capitalism or the cozy working arrangements between
politicians and corporate leaders who got special favors in return
for kickbacks. (A minority analysis held that the real problem was
that our banks grossly overlent to countries trying to grow too fast.)
Since then, both the World Bank and the International Monetary Fund
have refused to grant loans to companies with a record of corruption.
The anti-corruption campaigns biggest success occurred about
two years ago when the Organization for Economic Cooperation and Development
(OECD), the Paris-based club of wealthy nations, convinced its 29
members to sign on to an Anti-Bribery Convention. The treaty has flaws.
It provides a legal loophole for bribery of public officials. It doesnt
prohibit signatory nations from accepting as a tax-deductible business
expense bribes paid by companies. But once the treaty comes into full
effect, it will cover countries that account for almost three-quarters
of global trade. The rule of law will be globally triumphant, for
corporations at least.
Not quite. For one thing, its never been self-evident that corruption
prevents economic development. Certainly, not absolutely so. According
to Berlin-based Transparency International, the worlds most
corrupt country is Bangladesh. Its in terrible shape. The least
corrupt, Finland, is doing fine. But lots of countries that rank high
on the corruption scale, such as China, Thailand, and Malaysia, are
also doing fine. Indonesia was booming until four years ago, and its
present troubles are more political than economic.
Most OECD nations already have laws that prohibit the commission of
a crime, such as bribery, abroad. Canada does. But theres never
been a single court case brought against a Canadian company. Heres
the rub. We profit from corruption. The losers are the people in the
Third World countries, not their leaders. Hence, the contradiction
between our fine words on battling corruption and our deedsthose
of our corporations, that is to say.
In the year May 1, 2000, to April 30, 2001, its reported reliably
that contracts worth US$37 billion were probably affected by the bribery
of foreign officials. Of these suspect contracts, more than 70 percent
involved companies in the OECD member states that signed the much
heralded Anti-Bribery Convention. A U.S. Senate inquiry has recently
recorded that once bribes are given to Third World officials, their
most likely resting place is in the banks of First World nations.
Which makes us accessories to the crimes. So it seems that nothing
is going to change.
In fact, change is happening, not in the countries that do the
preaching, but in those that are preached atespecially
in the small African nation of Lesotho, where Lesothos
attorney general has brought a suit against a dozen Western
engineering companies for bribery. Lesothos action is
extraordinarily courageous, much more courageous than the World
Banks. When the bribery allegations first became public,
the bank suggested that no action be taken for fear the construction
scheme might have to be canceled.