examine the costs and benefit of corruption in developing countries

7/31/2019 Examine the Costs and Benefit of Corruption in Developing Countries

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Policy Analysis: Costs and benefit of corruption in developing countries | 1

EXAMINE THE COSTS AND BENEFIT OF CORRUPTION

IN DEVELOPING COUNTRIES

Shahril Budiman

Introduction

Corruption, which is problematic issues talking about that in many countries even the big

country like United States America, England and China facing the bribery case involved

the government, legislative, and probably judiciary also. In developing countries, the

concept of good governance has been established to decrease the number of corruption but

that nowadays just blur idea. The mentality and system of environment of bureaucracy alsothe most reason why corruption growing rapidly. Although, at the last decade has seen a

very significant increase in the international policy communitys interest in corruption.

From 1998 to present 38 countries have ratified the OECD Anti-Bribery Convention

(Benjamin,Rahini:2011). There is just small intervention for corruption but they are still

alive like mushrooms in the rainy season, the actor, system even more the law agencies who

has responsibility for eradicate corruption in these days joined to made the way of

corruption keep going on. However, behind that all of corruption, does we thinking about is

that really corruption only make pros or disadvantages affect? .Or otherwise, this thing was

delivery benefit even we did not aware, blame or embrace to say that.

Corruption an problem or a blessing in development countries

Corruption is disease or an endemic to government and society (C. J. Friedrich:167). The

number of corruption in these day is growing well seen from the type, the player and the

modus style. In the last 20 years corruption in the developing countries became a problem

of serious economic concern. In spite of that, analyzing the other side effect of corruption

such as the benefit of corruption are one of the study has been taken toward identify what is

driving factors of corruption. Moreover, the cost and benefit of corruption it must be

account and seek for future effect. Probably, there are some usefulness to prevent the

corruption cases.

The negative impact of corruption in developing country


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In this part, would be talking about what is the disadvantages or pros effect were

increasingly by corruption. There is several evidence from developing countries whether the

public sector, relation of public with private sector and probably the activity that were

giving affect according the social welfare. A significant consideration in this discussion

must be the impact of corruption

Bangladesh

The first country will be discuss is Bangladesh, based on the data corruption is widely

recognised to be a major problem in Bangladesh. In Transparency Internationals

Corruption Perceptions Index, Bangladesh featured as the most corrupt country for five

consecutive years (20012005). Political actors in the country have recognised the problem

as essential and have attempted to address it. (U4 Report 2011:47) Nevertheless, corruption

remains pervasive and systemic, posing a huge threat to the development of the country. By

clear the condition of Bangladesh see appendix I about Global Integrity report.

A part of that, For example, a sample of corruption cases studied by Transparency

International Bangladesh in 2007 describes political influence as part of the corruption

problem in the power sector (Khan, Rasheduzzman, and Nahar 2007) and the port of

Chittagong (Mahmud and Rossette 2007). As these constitute the heart of the economy of

Bangladesh, corruption in these sectors has severe economic consequences for the public

purse and for the population. Corruption has been take the rights of society get the social

welfare, access of education also account the higher number of children did not touching the

education. Moreover, corruption in Bangladesh made the movement of economic

development relatively unstable, many of poor people, jobless.

Other way of finding about the level of corruption in a given society could be by monitoring

the media as the results, the evidence how the corruption affects society as personally and

the majority of the country is the power supply:

The electricity supply in Bangladesh now is just awful. Currently, Bangladesh canonly meet about 60% of demand for electricity, so the supply is rationed around thecountry, one hour here, one hour there, maybe two hours so no matter how hard

anybody, in any sector tries to improve their own life or the lives of the peoplearound them, you can only do so much because anything that relies on usingelectricity, you just cant rely on.(source: http://deepinthedesh.wordpress.com)

That is just little bit an example of the effect of corruption but in other side make big impact

to society. Therefore, awareness of society, NGO and importantly role of law enforcement,


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the commission of eradicate corruption are always looking the movement and supervision to

government.

Indonesia

The negative impact of corruption in developing countries also could we see in Indonesia.

The efforts to combat corruption in Indonesia must be rooted in context and the interests of

the nation. In short, the study about effect negative because of corruption has been looking

of many university in Indonesia. Such as Paramadina University had been working with

CSRC (Center for the Study of Religion and Culture) UIN Syarif Hidayatullah to collect the

massive impact of corruption such as :

1. Slowdown the movement of economy2. Increasing number of poverty3. Potentially high Crime4. Demoralization5. Destruction of the bureaucracy system6. Disruption of politics & government7. Blurring the Future of Democracy8. The collapse the Rule of Law

In Indonesia, the everyday corruption most firms face involves interaction with localofficials, who administer regulations and indirect taxation. These are district (kabupaten)

level officials, where a district is similar in geographic scope to northeast US counties.

In 2007, the countrys main audit agency reported that 60 percent of Indonesianschools has misappropriated state funds devoted to improving and repairing schoolfacilities. Moreover, Indonesian Corruption Wacth (ICW) has accused severalgovernment-run schools in Jakarta of allegedly embezzling as much as $633 million infunds awarded by the state for operational assistance. In addition, the minister ofeducation, Muhamad Nuh, at that time said the government planned to change the wayregional educational offices receive funds to cut out red tape, which he blamed for thecash loss (Sara Schonhardt:December 9, 2010).

The cost of corruption in developing countries in above, occurred also in many country

there is only little example. If the spread amount of corruption and still remain move

slightly so in the future we will see the number of poverty, access of education, mitigation

or public interest could be loose.

In the other hand, both the individual and society as a whole increasing greed and avarice of

the asset and wealth mastery of corruption will also cause loss of sensitivity and concern for

others. Mutual trust which is one of the main social capital will be lost. As a result, appears

phenomenon of distrust society, that people who have lost a sense of trust, both among each


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other individuals, as well as against state institutions. Feeling safe will be replaced with

feelings of insecurity.

Benefit of corruption an analysis

Does corruption have benefit to others? That is the biggest question while other areas

achieve the massive impact of corruption. This call the externality of corruption, the

influenced is direct or indirect. Therefore the distinguish of benefit will be divide in two

areas. Firstly, the advantages for the actor and secondly is institution.

Most of the people who had been doing corruption, at the first one the results is the

advantages, for instance : Take the case of a businessman who has imported goods that are

being held up at the port. Every day of delay causes a huge loss to the businessman. In such

a situation, a little grease can speed up the transaction. It can be said that everyone, the

businessman, the corrupt official, and the national economy are better off because of the

corruption. The officer will enjoy with the money and achieve the externalities of salary,

could have better life than those not doing corruption.

Afterward, for the institution like company corruption give the benefit such as they can

shortcut the bureaucracy or procedure for doing business in one area. Based on my own

experience giving external money to get the project and our company will be win in the e-

prorecruitment. Moreover, corruption also making easy for institution especially private

sector to get more security when they have link with military. That is occurred when I go tosome place and also friend who has military officer had been doing this. The money will

use to buy external equipment when not produce by government or not longer again.

They are sometimes making confuse, corruption in one side when doing business for

economic development give benefit impact to grow local state for instance they did not get

fund allocation from national state. But in the other hand, the massive impact is corruption

integral with civil servants in many aspect such as public service.

Conclusion

Finally, the negative impact could conclude in several aspects such as:

1. Inhibit investment and economic growth.

2. Corruption weakens the capacity and ability of the government in implementing

development programs.

3. As a result of the impact of the first and second, then corruption will hinder the fight

against poverty and income inequality.

4. Corruption affects degradation of morality.


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In addition, benefit only deliver the happiness for small community rather than big

population to enjoy that. In developing countries the number of corruption still higher. But

that is not only internal factor but the behavior of foreign company giving gift could mean

as bribery and means as corruption.

APENDIX I

Source: Global Integrity, Washington, DC.http://report.globalintegrity.org/Bangladesh/2008


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http://deepinthedesh.wordpress.com/2007/02/22/the-cost-of-corruption-in-

bangladesh/) Published February 22, 2007

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(Retrivied : http://www.globalpost.com/dispatch/indonesia/101209/corruption-fight-

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