Despite Crackdown, Survey Indicates Corruption Still a Challenge in Asia
Major regional surveys say corruption in Asia remains a major development challenge for governments, although China’s crackdown on corruption under President Xi Jinping is seen as having an impact on public perceptions.
The surveys by the Berlin-based Transparency International and analysts with the Hong Kong-based Political and Economic Risk (PERC) come as several countries – including China – are taking public steps to address corruption in government and business.
The PERC report, released March 30, says there are positive signs that while corruption remains a major issue, “perceptions about corruption in Asia on average have improved compared with one year ago.”
Under the PERC survey, Singapore, Australia and Japan are ranked with low levels of perceived corruption, with a positive outcome also for Sri Lanka, while at the bottom of the scale is Cambodia, followed by Indonesia and Vietnam.
China’s ranking is seen to have improved. “President Xi Jinping’s anti-corruption crackdown clearly seems to have made a positive impression,” the Hong Kong analysts said.
“The magnitude of the problem is still large, which means there is a lot of work still to do, but President Xi’s policies have created the impression first, that the government is serious about fighting graft at all levels, and second it is making real headway,” they added.
But Transparency International’s assessment is less positive. “People in China were most likely to think the level of corruption had increased recently – nearly three quarters of people said corruption had risen,” the report said.
The TI report was positive in its assessments of official efforts by the governments of India, Indonesia and Thailand in taking steps to address corruption, even though India was still marked as having the highest bribery rate of all the countries surveyed.
The PERC analysis said while “few in India think there has been any actual improvement in that country’s systemic corruption, but they give Prime Minister [Narendra] Modi credit for using creative ways to fight the problem like his surprise ban on large bank notes.”
Lawyers with the legal firm Baker McKenzie, Mini VandePol and Vivian W. Wu, in a commentary on the TI survey, said China’s anti-corruption landscape was now “more stringent than ever.”
They pointed to several reforms including sentencing guidelines on official and commercial bribery offenses, amendments to China’s criminal law, new rules on “whistle-blowing,” amendments to Anti-Unfair Competition, and steps extending to new donation rules for the health care sector.
The PERC analysis said China’s anti-corruption czar, Wang Qishan, holds the key over the longer term success of the Xi-led policy. But the analysts added concerns that after the men retire, “there was a chance of corruption making a comeback.”
While emerging economies such as Vietnam, Cambodia and Indonesia ranked poorly in corruption perceptions, the countries are still reporting sound rates of economic growth.
Pavida Pananond, associate professor of international business at Thammasat University, said investors are prepared to accept a certain level of corruption “as part of the risk of doing business in emerging economies.”
But she said there is a toll on business confidence that occurs when corruption is “unpredictable and no clear practice on how far it would go.”
“The level where it goes and no certain kind of practice on what needs to be paid that would become a strong deterrence for business that wants to be clean and clear,” Pavida told VOA.
In the Transparency International and PERC surveys, people in Thailand rated positively the military government’s program aimed at fighting corruption. The TI survey showed only 14 percent of people considered corruption had increased and 72 percent rated the government’s policy favorably.
“Bribes paid by firms to officials and regulators to secure contracts have dropped to their lowest level for five years, according to the University of the Thai Chamber of Commerce,” the PERC commentary said.
Bandid Nijathawaorn, a former deputy central bank governor and currently president of the Thai Institute of Directors, said the Thai corporate sector has sought to confront the corruption problem.
Bandid said a coalition of 820 corporations against corruption, launched in 2010, has pressed the government to move on law reform covering procurement and reducing bureaucratic “red tape.”
But while there has been progress, Bandid said the problem in Thailand remains endemic.
“The problem is quite deep-rooted and systemic in a sense. So you cannot depend on one single organization to help improve it. To improve the situation [it] must come from all the key participants in the economy, including the government sector, the private sector and also the civil society to address the problem,” he told VOA.
High profile cases
Last October, Thailand launched a specialized corruption court aiming to quickly resolve corruption cases.
In a high profile case, the court sentenced former Tourism Authority (TAT) governor Juthamas Siriwan to 50 years in jail for accepting $1.8 million in bribes from two Americans seeking the rights to host an international film festival in Thailand.
Other cases include $36 million in illegal payments by aircraft engine maker Rolls-Royce, said to have been made to executives of national carrier Thai Airways over several years, and to the state-controlled energy corporation PTT plc.
Thammasat University’s Pavida said such cases will prove to be a test for the government’s policy on corruption.
“When you clean up something, you need to put in a strong check and balance mechanism that can make sure that things would be implemented no matter who is in power,” she said.
Thailand’s anti-graft agency was reported Monday as saying it expected to conclude the investigation into the high-profile Rolls-Royce bribery scandal by year’s end.