Despite the supposed global nature of the economic crisis, a number of countries in Asia have managed to maintain robust enough growth rates to make the whole thing feel more like a Western story. But while the resource sector in energy-hungry China and the construction sector boom of new roads and high-rise buildings across the continent suggest the region should be well on its way to slashing poverty, there’s a potentially major obstacle to continued rapid growth: these booming sectors are chronically corrupt.
Speaking at the recent International Anti-Corruption Conference in Bangkok, Prof. Paul Collier said that increased corruption could undermine the opportunity for many of the about 900 million Asians living on less than $1.25 a day to climb out of poverty.
‘Commodities and construction are the two most corrupt sectors on earth,’ said Collier, a professor at Oxford University and author of The Bottom Billion.Enjoying this article? Click here to subscribe for full access. Just $5 a month.
Eyebrows were raised by the choice of Thailand, a country with a reputation for bribe-seeking police and kickback-chasing officials, to host the IACC. Indeed, Prime Minister Abhisit Vejjajiva acknowledged the seriousness of the issue in his country when opening the event, saying that corruption isn’t just a problem in Thai business or politics, but that it has deeper roots. ‘An unbelievable number of people believe that it’s OK for politicians to be corrupt so long as they can bring economic growth,’ he said.
While such ingrained views may not be universal, the fact is that corruption exists everywhere, even in countries that pride themselves on clean government and a transparent business culture—and even if they might be in denial about it. During the IACC, for example, journalists from Costa Rica told of Finnish corporate involvement in a domestic corruption case, which the Finnish Government and media refused to investigate or even acknowledge.
In Asia, Thailand’s neighbour Cambodia ranks a lowly 154 out of 178 in the 2010 Transparency International Corruption Perception Index (CPI), the second-lowest in South-east Asia after Burma, and well below Thailand on 78. So far, Chinese investment into Cambodia during 2010 is estimated at $8 billion, comprising around 360 projects.
A plan to build what will be Asia's tallest building was mentioned by Prime Minister Hun Sen in September, in what would be the showpiece of Phnom Penh's property and construction boom. But if Collier's thesis is correct, then Cambodia's new-found building boom, funded by Chinese investment and resource extraction, is bound to mean more backsliding in the global graft indices for the country.
Still, Cambodia recently announced the first arrest of an official on alleged bribery charges by the country’s new anti-corruption task force, on charges of accepting $8000 in bribes from illegal loggers. Other countries in the region have been taking similar action. Indonesia's KPK, or independent Corruption Eradication Commission, recently appointed a new head after the previous one resigned mid-term to face murder charges in a trial that his defenders view as a thinly veiled effort to sabotage the KPK (the body has been handed a strong mandate to go after suspects in politics, the bureaucracy and business).