institute for security studies june, 2012. a) corruption trends in africa corruption becoming more...
TRANSCRIPT
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%)
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
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
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