Nathaniel
Disclosure -- The World Bank is a funder of Global Integrity.
The Wall Street Journal editorial board rips into the World Bank for giving US$640 million in few-strings-attached loans to Bangladesh and Vietnam, despite their abysmal records on corruption -- a fact noted by the Banks's own research.
Wall Street Journal:Since May, Bangladesh's military-backed government has arrested an estimated 12,000 people without charge and confined them to overcrowded prisons. Human Rights Watch reports "well-documented patterns of torture and mistreatment of detainees." The government has canceled plans for a December election [Update: this claim has been disputed, see comments below] over the objections of the two main political parties, whose leaders have also been in and out of jail.
The World Bank Institute and Transparency International's corruption perceptions data highlight an international awareness of serious problems in both countries. Global Integrity's reports on anti-corruption practices in Vietnam and Bangladesh, which use a very different methodology, describe similarly grim results.
None of this has deterred the bank from going forward with a $200 million "transitional support credit," which it says the government needs to deal with rising commodity prices and last year's Cyclone Sidr. There is also a $120 million "power sector development policy credit" that will "support the government's overall power sector reform program." The bank justifies these loans partly on account of the "impressive economic and social gains" it claims Bangladesh has made, and partly because it thinks more money would actually help address the corruption problems.
For a reality check, the bank might have consulted its own experts. According to the bank's internal data on "governance indicators" in Bangladesh, measures of government effectiveness, political stability, "voice and accountability," regulatory quality and control of corruption all declined between 1998 and 2007. A report from Transparency International reaches similar judgments.
The Wall Street Journal's editorial board, often considered the most conservative voice in mainstream American media, is echoing complaints that left-wing anti-globalization activists have been making about the Bank for more than a decade. When you have that kind of convergence, it's probably a sign that something is seriously wrong.
--Jonathan Werve
Wednesday, July 23, 2008
World Bank Draws Fire for New Loans
Friday, July 18, 2008
Bulgaria: EU Shuts The Purse Until Corruption Is Fixed
The Economist highlights impending European Union sanctions aimed at corrupt politicians in Bulgaria, with 1 billion euro (US$1.6 billion) in aid at stake. While this certainly seems like a bad news day for Bulgaria, the tough medicine being imposed by the EU is a pretty strong signal that corruption in Bulgaria is being challenged.
This willingness (albeit external) to tackle sticky problems may explain our surprisingly positive assessment of Bulgaria's anti-corruption policies in the latest Global Integrity Report. As we have said many times before: a scandal like this isn't the worst possible outcome. Leaving problems unacknowledged is far more troubling.
The Economist: FIRST fingers were wagged, then wrists were slapped. Now the pocket money is being stopped. The European Union had already frozen some EURO1 billion ($1.6 billion) in funds overseen by Bulgarian politicians whom it no longer trusts. Now, in a report[1] to be published on Wednesday July 23rd, the EU says that Bulgaria may have to forfeit large chunks of that money altogether. At issue are hundreds of millions of euros allocated to programmes predating Bulgaria's accession to the EU in January 2007. These were designed to get the country ready for the rigours of life within the EU...
The outcry over the lack of political will is fascinating -- we've often used the same phrase to describe the missing element in fighting corruption, and if the EU can create it by yanking away a billion euro (with even tougher sanctions in reserve), then good for them. The EU report also notes the suspected involvement of organized crime in government, a theme we touched on in last year's Reporter's Notebook: Bulgaria.
The report says in caustic terms that there is no political will to deal with fraud and corruption in handling EU funds. It highlights close links between leading public figures and companies that have benefited from tenders for EU-financed projects. It concludes: "Bulgaria...has to ensure that the generous support it receives from the EU actually reaches its citizens and is not siphoned off by corrupt officials, operating together with organised crime."
-- Afroza Chowdhury & Jonathan Werve
Thursday, January 31, 2008
Millennium Challenge Corp. cuts Philippines aid
The Millennium Challenge Corporation (MCC), an American government aid agency, has restricted aid flowing to the Philippines due to concerns about corruption. The MCC is setting aside a prior decision to promote the country from "Threshold" to "Compact" aid status, which would have secured significant funding for development projects. The decision appears largely based on the World Bank Institute's aggregation of corruption perception surveys, which report a worsening public perception of corruption problems.
The Global Integrity data on the Philippines (2007, 2006, 2004), which examines the anti-corruption framework rather than public perceptions of corruption, show consistent -- though not very good -- performance in recent years. As we note on the cover of our 2007 report, an overall score change from 2006 to 2007 is not a trend, but reflects the inclusion of a new investigation of state-owned enterprises, an area where the Philippines performs poorly.
From ABS-CBN: The head of America’s chief global poverty-fighting arm said indications of worsening corruption in the Philippines is blocking the way to hundreds of millions of dollars in additional help. John Danilovich, Chief Executive Officer of the Millennium Challenge Corporation (MCC), said they have “serious concerns” with corruption indicators for the Philippines. “The drop in performance was in fact very dramatic,” he told reporters during a briefing at the Foreign Press Center here on Wednesday, January 30.