Transcript Corruption Trends cont… - Institute for Security Studies

INSTITUTE FOR SECURITY
STUDIES
June, 2012
A) Corruption Trends in Africa
• Corruption becoming more complex due to
technology
• Corruption now entangled with organised
crimes – drug trafficking, tax evasion,
smuggling, human trafficking etc
• Corruption now internationalised and trans
boundary
• Corruption part of body politic
Corruption trends cont..
• Quite corruption cited as inhibiting
development in Africa (WB, 2010):
 In 2004, 20% of primary sch teachers in rural
western Kenyan could not be found during school
hours; In Uganda, this was btwn 20% and 27%
 Poor controls resulted in 43% of fertilizers sold in
West Africa in the 1990s lacking expected
nutrients
 Over 50% of drugs sold in Nigerian drugstores in
the 1990s were counterfeit
Corruption Trends cont…
• Africa has lost more than USD140 bn due to
corruption by own governments & foreign
companies since independence (TI, 2006)
• 25 % of GDP of African states is lost to Corruption
each year (World Bank Institute)
• This is despite Africa moving towards heavy
regulations
• Strong correlation btwn Corruption Perceptions
Index on one hand with black market activity and
overabundance of regulation (World Bank)
Corruption in Police, KRA,
Customs
• In Kenya, apathy to corruption is high but
reducing
• Propensity to bribe and not report fell from
64% in 2008 to 56% in 2009 (TI)
• Kenyan Revenue Authority (KRA) reports that
when collecting taxes at the port, customs
officials are often offered bribes by taxpayers
• Bribe rate is fixed to one-third of the total
taxes evaded.
Police, KRA, Custom
• More than 80 per cent of importers, including
reputable companies, have tried to avoid
paying proper import duties (TI)
• Police: Rated as most corrupt public
institution in Kenya (TI)
• Six out of ten Kenyans have paid bribe to
police
• Number of bribes paid to police reducing, but
amount becoming bigger
Corruption at Customs…..
• KRA struggling to dispose off environmentally
harmful substances worth millions of shillings.
• The goods are then transported across Kenya
after bribery at several police checks
• Customs procedures in Kenya rated at 3.3 on a
7-point scale of efficiency (7 – very efficient)
• Standardised export shipment requires
8 documents & takes an average of 26 days at
a cost of USD 2,055 per container
B) Latest Anti Corruption
Instruments
• Use of IT and Automation: removes human
agents and thus corruption opportunity
• Increased Transparency: Removes
opportunity for discretion
• Detection in operations: Creating systems
where details of operations can be monitored
• Preventive Detection: Monitor to detect
preparations for corrupt action
Anti corruption instruments..
• Awareness Creation:
• Reporting: Mobilising users or community to
report cases of corruption
• Deterrence: Publishing information about
reported corruption
• Promoting Ethical Attitudes: engaging the
public through discussions in various forums
C) Capital Flight out of Africa
• Africa lost USD18.4 bn annually as a result of
capital flight btwn 1970 & 2008 (ADB)
• Had this been invested in Africa, poverty
would have been cut by 4 – 6 % annually
• That means Africa could have realised its MDG
goals by 2015
• Yet Africa had lowest aggregate level of
Human Development indicators in 2011
D) Remittances Into Africa
• remittance flows to Africa since 1991 has
exhibited a steady growth (ADB)
• It rose from less than US$ 2 billion in 1991 to
nearly US$ 5 billion in 2003
• Nigeria is by far the largest recipient of
remittances in Africa, accounting for one-third
of all remittance flows to the continent
• Its followed by Kenya, Lesotho, South Africa,
Mauritius, Uganda, Benin & Cape Verde
E) Chinese Investments in Africa
• China‘s emergence as a major trading partner
for Africa is to continue growing.
• Even though European countries still remain
Africa‘s leading partners, things are gradually
changing (ADB)
• From China‘s perspective, China-Africa trade is
still modest. China-Africa trade comprises only
4 percent of the total Chinese imports and
exports
China Investment…
• From an African perspective, China-Africa
trade growth is more important as it
represents close to 10 percent of the
continent‘s exports and imports
• Africa‘s trade with China is with just a few:
• Up to 60 percent of Chinese exports are
destined for just six countries: South Africa
(21%), Egypt (12%), Nigeria (10%), Algeria
(7%), Morocco (6%) and Benin (5%)
China Investments…
• But 70 percent of Chinese imports originate
from four countries: Angola (34%), South
Africa (20%), Sudan (11%) and Republic of
Congo (8%)
High Concentration of Chinese Exports to
Africa (2007)
High Conc. Of Chinese imports from Africa
(2007)
China Investments: Lessons from Angola
• China has played important role in reconstruction
of China
• Chinese financial and technical assistance has
kick-started over 100 projects in energy, water,
health, education, telecommunications, fisheries
and public works
• For each tender, China proposes 3-4
• Chinese companies
• Angolan Ministry of Finance had little input since
funding was provided directly to Chinese firms
Lessons from Angola…
• Chinese investment has contributed to
poverty reduction in Angola
• Angola remains open to other trading
partners: officials say they do not want to
close options
• New challenges for Angola – China trade: lack
of global understanding thus suspiscion;
language barriers; policy challenges
Chinese and Corruption
• High corruption in most public works and
construction by Chinese companies (TI)
• Chinese and Russian Companies most likely to
pay bribes
• China and Russia occupied positions 27th &
28th in the 28 country index of countries most
likely to pay bribes in 2011
F) Global Trends in Drug Trafficking
• Cannabis continues to dominate world illicit
drug markets in terms of pervasiveness of
cultivation, volume of production and number
of users
• Morocco & Afghanistan are world’s leading
growers & producers of cannabis
• In a 2009 survey in Afghanistan, area under
cannabis cultivation was between 10,000 ha &
24,000 ha (UNODC)
Drug Trafficking Trends
• It has a range of 1,500 tons and 3,400 tons for
the production of cannabis resin
• In a 2005 survey in Morocco, total area under
cannabis cultivation was 72,500 ha in 2005,
down from 134,000 ha in 2003
• Other leading producers of cannabis in Africa
are Angola, Cameroon, Egypt, Ghana &
Nigeria etc
Opiates….
• In 2009, Area under opium poppy cultivation
worldwide fell to an estimated 181,400 ha
• This was a decrease of 15 per cent on the level
in 2008, which had 213,000 ha
• Afghanistan leads in opium poppy cultivation,
which accounts for big portion of heroine
• Coca bush cultivation remained concentrated
in Colombia, Peru and the State of Bolivia
Opiates/Coca…
• But Colombia remained with the largest area
under cultivation, followed by Peru, for Coca
bush
G) Human Trafficking out of Africa….
Figures for Africa (Source: IOM)
Regional overview of cases assisted, by
exploitation
H) Failed States
• Somalia continued to occupy the top spot of
most failed state for fifth year running in 2012
• Middle East Countries tumbled along with
Japan and UK
• Finland remained the most successful state in
2012, followed by Sweden, Denmark,
Switzerland and Norway in that order
• List of top five most & bottom five most
successful has remained consistent for 5years
Top Ten Failed States in 2012
..AND BOTTOM 10 MOST
SUCCESSFUL STATES
1
Somalia
114.9
2
Congo (D. R.) 111.2
3
Sudan
109.4
n/r
South
Sudan*
108.4
4
Chad
107.6
5
Zimbabwe
106.3
6
Afghanistan
106.0
7
Haiti
104.9
8
Yemen
104.8
9
Iraq
104.3
10
Central
African
Republic
103.8
167
Netherlands
28.1
168
Austria
27.5
169
Canada
26.8
170
Ireland
26.5
171
New Zealand 25.6
172
Luxembourg
25.5
173
Norway
23.9
174
Switzerland
23.3
175
Denmark
23.0
176
Sweden
21.3
177
Finland
20.0