Corruption alive and well worldwide, 'sobering,' report says

By Tony Czuczka Jul 10, 2007, 17:46 GMT

Washington - Global efforts to cut corruption and improve government quality have made little progress in the last 10 years, despite bright spots in Africa and Eastern Europe, the World Bank said Tuesday.

The aid agency's global governance report for 2006 shows several regions backsliding or stagnating since 2004 in the fight against graft, including East and South Asia, Latin America and even the rich nations in the Organization for Economic Cooperation and Development (OECD).

The lack of progress since the World Bank's first report in 1996 is 'sobering,' with gains in some countries generally cancelled out by setbacks in others, the authors said.

'For now we cautiously conclude that we do not have as yet any convincing evidence of significant improvements in governance worldwide,' the report said.

The survey seeks to mould indicators such as political stability, democratic safeguards, rule of law and control of corruption into an annual snapshot of how the world's 6.6 billion people are governed.

Eastern Europe and the Baltics made further progress against corruption, but since 2004 lost some gains in the quality of business regulations, the report said.

Finland won top honours in fighting corruption, followed closely by Singapore. Overall, Denmark won consistently high marks for governance among rich nations, while former Soviet states Ukraine, Armenia and Georgia made dramatic gains in the past five years.

The World Bank, which lends some 23 billion dollars a year for aid projects, has denounced corruption as a drain on development and a major obstacle in the fight against poverty and disease.

Although former World Bank head Paul Wolfowitz ruffled feathers by linking some loans to countries' anti-graft efforts, the issue remains at the top of the bank's agenda.

Some African countries are making strides toward good governance, including Kenya, Algeria, Sierra Leone and Tanzania, but 'other African countries still face enormous government and development challenges,' a summary of the report said.

Meanwhile, emerging economies are catching up with rich nations. More than a dozen countries, most of them in formerly communist Eastern Europe, scored higher on key measures of governance than countries such as Greece and Italy.

Slovenia, Estonia and Hungary got some of the highest scores in Eastern Europe, while Chile, Uruguay and Costa Rica got high marks in Latin America.

Yet Brazil, Latin America's largest economy, has backtracked on core economic measures of governance since about 2003, the report showed.

China in 2006 improved its anti-corruption stand and the rule of law, but civil freedoms and political stability declined, the World Bank found.

In Asia, Hong Kong managed to improve its already excellent anti- graft record last year. Singapore ranked just ahead, though its rating for political freedoms declined since 2004.

Taiwan, South Korea and Malaysia also ranked high in fighting corruption and regulatory quality.

In the Middle East, the United Arab Emirates and Israel ranked highest in controlling corruption and providing favourable regulations for business. Other Gulf states came in next, followed by Jordan, Tunisia and Saudi Arabia.

In Europe, Denmark led in four categories, including rule of law. Finland topped the survey's two other measures, among them fighting graft. Italy and Greece generally ranked at the bottom of the scale.

South Africa and Ghana were top-ranked in key governance measures in sub-Saharan Africa.

The survey combines data from 33 publicly available sources to calculate worldwide governance indicators.