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Experts weigh in on bane of corruption in regional business - Daily News Egypt

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Experts weigh in on bane of corruption in regional business

By Reem Abdellatif CAIRO: In light of the calls for change resonating across the Arab world this past year, the annual Economic Research Forum (ERF) conference focused on the theme of corruption and its deleterious effects on economic development. On the corruption scale measured by the ERF, Egypt is rated one of the highest in the …


By Reem Abdellatif

CAIRO: In light of the calls for change resonating across the Arab world this past year, the annual Economic Research Forum (ERF) conference focused on the theme of corruption and its deleterious effects on economic development.

On the corruption scale measured by the ERF, Egypt is rated one of the highest in the region, along with Jordan, Tunisia, Kuwait and Algeria.

During the weeklong seminar, international researchers and scholars convened in Egypt, the region’s largest economy, to present reports on the measurement, consequences and determinants of corruption as well as ways to combat it.

Experts stressed that the public must engage with the Islamic front, a rising political force in the region, already dominating most elections in Egypt and Tunisia.

“People need to engage with the Islamic front,” said Mustaq Khan, researcher from the University of London.

Pinpointing many countries in the Middle East and North Africa region (MENA) that suffer from corruption, John Nugent, researcher from ERF and University of Southern California, said that the key to minimizing this lies in transparency.

“Freedom of the press and an independent judiciary are essential especially for countries of the region at this time,” he said, referring to the uprisings sweeping the region.

Nugent used the example of a National Public Survey conducted by Egypt’s state-owned think tank, Al-Ahram Center in 2009. The household survey found that corruption was rated as the third most important problem after unemployment and poverty in Egypt.

The research also showed that 90 percent of those surveyed agreed that low wages and income as well weak oversight were the main causes of corruption.

Overall, 12.5 percent of Egyptian firms say they had to pay some sort of “gift” to facilitate their work. About 10.6 percent said that they had to pay for the registration processes, while 15.9 percent reported that they had to pay for licensing procedures.

Moreover, as much as 84.2 percent said they had to pay these gifts to ease the tax administration process, while 84.6 percent paid to facilitate labor regulations, including labor unions, who were stifled for years under the regime of ousted president Hosni Mubarak.

Toughening consequences is vital to combating corruption, as are adding benefits, costs and tradeoffs that give workers in the public an incentive to avoid accepting bribes or “gifts.”

Although adding penalties for corruption and applying better transparency are suggested remedies, Khan stressed this is often not enough.

“Anti-corruption strategy includes reducing or removing discretions by removing unnecessary functions and applying better procedures, or raising salaries of government officials so they have more to lose if they are caught,” Khan explained to a group of researchers and reporters.

“Generally speaking, these are not working, so something else is going on here,” he added.

According to Khan, there must be market restricting applied to corruption.

For example, he pointed out that often times, unnecessary regulations or procedures are applied so the public sector can simply make money from people by having citizens pay bribes to ease these regulations.

Moreover, whether political or institutional, Khan also underlined the fact that “generally” corrupt officials win most elections because they have more underhanded “resources” than uncorrupted officials.

“This is the case because corrupt officials have more resources to use and thus an upper hand in mobilizing people,” said Khan.

Topics: arab world

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https://www.dailynewsegypt.com/2012/03/26/experts-weigh-in-on-bane-of-corruption-in-regional-business/
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