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Same-Day Analysis

Global Index Highlights How Corruption Stymies Poorest Economies

Published: 18 November 2009
Transparency International's latest Corruption Perceptions Index—which counts IHS Global Insight among its contributors—has once again drawn attention to a global scourge that serves to widen the economic gulf between the richest and poorest countries.

IHS Global Insight Perspective

 

Significance

Transparency International (TI)'s index is the most authoritative global source on corruption, receiving close attention from media and governments alike.

Implications

The findings are inevitably a mixed bag—some countries stand out for their improvements while others have sunk down the ranking. For the international community it is particularly galling to see how low Iraq and Afghanistan rank, suggesting that much of the international assistance provided to those countries is merely lining the pockets of officials.

Outlook

Corruption is never going to be eliminated around the globe, but TI and bodies such as the World Bank are providing a valuable service in repeatedly naming and shaming, and spreading best police practice.

Naming and Shaming

Transparency International (TI) has established a strong reputation over the years for its work assessing corruption and providing resources to counter it. Its highest-profile publication is the Corruption Perceptions Index (CPI), the 2009 edition of which came out yesterday. The index draws upon surveys and expert opinions of a range of organisations including IHS Global Insight. It does not measure incidents of corruption, but rather perceptions of levels. The former is almost impossible to assess as most instances are never revealed. The index always receives great media interest and can cause individual governments grave discomfort if their countries slip down the ranking. International donors also look closely at the results, and will cite them when deciding on priorities and setting requirements for recipients.

TI has chosen to highlight the danger that corruption poses to global economic recovery in 2009/10. Many governments are pouring stimulus funds into their economies to escape the worst recession in decades, but the effectiveness of this will be greatly diminished if the funds are diverted via corruption. While it tends to be poorer economies that figure strongly at the lower end of the table, the authors stress that no country is immune and that complacency is dangerous.

Corruption tends to be most pervasive in countries scarred by war and ongoing conflict. Somalia, Afghanistan, Sudan, and Iraq are notable on this front. Governance structures have been destroyed and there is little to prevent officials from lining their pockets. These countries also tend to be major recipients of foreign aid, the effectiveness of which is compromised by corruption. The situation locks these countries into a vicious cycle from which it is very difficult to escape. High levels of corruption undermine public trust in young governments, undermining their legitimacy and political stability more widely. TI calls on international donors to focus on strengthening institutions in these countries and to demand transparency and accountability. There also needs to be an onus on foreign investors not to feed the cycle by paying bribes in order to secure contracts and favourable treatment.

At the top end of the scale are clustered many of the most developed economies, with Western Europe particularly well represented. New Zealand nonetheless edges out Denmark for the top spot this year, the top five being rounded out by Singapore, Sweden, and Switzerland. All have very well-established public institutions, high stability, and a strong anti-corruption culture.

Transparency International - 2009 Corruption Perceptions Index

Rank

Country

Score

Rank

Country

Score

Rank

Country

Score

1

New Zealand

9.4

61

Cuba

4.4

120

Bolivia

2.7

2

Denmark

9.3

61

Turkey

4.4

120

Ethiopia

2.7

3

Singapore

9.2

63

Italy

4.3

120

Kazakhstan

2.7

3

Sweden

9.2

63

Saudi Arabia

4.3

120

Mongolia

2.7

5

Switzerland

9.0

65

Tunisia

4.2

120

Vietnam

2.7

6

Finland

8.9

66

Croatia

4.1

126

Eritrea

2.6

6

Netherlands

8.9

66

Georgia

4.1

126

Guyana

2.6

8

Australia

8.7

66

Kuwait

4.1

126

Syria

2.6

8

Canada

8.7

69

Ghana

3.9

126

Tanzania

2.6

8

Iceland

8.7

69

Montenegro

3.9

130

Honduras

2.5

11

Norway

8.6

71

Bulgaria

3.8

130

Lebanon

2.5

12

Hong Kong

8.2

71

FYR Macedonia

3.8

130

Libya

2.5

12

Luxembourg

8.2

71

Greece

3.8

130

Maldives

2.5

14

Germany

8.0

71

Romania

3.8

130

Mauritania

2.5

14

Ireland

8.0

75

Brazil

3.7

130

Mozambique

2.5

16

Austria

7.9

75

Colombia

3.7

130

Nicaragua

2.5

17

Japan

7.7

75

Peru

3.7

130

Nigeria

2.5

17

United Kingdom

7.7

75

Suriname

3.7

130

Uganda

2.5

19

United States

7.5

79

Burkina Faso

3.6

139

Bangladesh

2.4

20

Barbados

7.4

79

China

3.6

139

Belarus

2.4

21

Belgium

7.1

79

Swaziland

3.6

139

Pakistan

2.4

22

Qatar

7.0

79

Trinidad and Tobago

3.6

139

Philippines

2.4

22

St Lucia

7.0

83

Serbia

3.5

143

Azerbaijan

2.3

24

France

6.9

84

El Salvador

3.4

143

Comoros

2.3

25

Chile

6.7

84

Guatemala

3.4

143

Nepal

2.3

25

Uruguay

6.7

84

India

3.4

146

Cameroon

2.2

27

Cyprus

6.6

84

Panama

3.4

146

Ecuador

2.2

27

Estonia

6.6

84

Thailand

3.4

146

Kenya

2.2

27

Slovenia

6.6

89

Lesotho

3.3

146

Russia

2.2

30

United Arab Emirates

6.5

89

Malawi

3.3

146

Sierra Leone

2.2

31

St Vincent and the Grenadines

6.4

89

Mexico

3.3

146

Timor-Leste

2.2

32

Israel

6.1

89

Moldova

3.3

146

Ukraine

2.2

32

Spain

6.1

89

Morocco

3.3

146

Zimbabwe

2.2

34

Dominica

5.9

89