Region - Anti-corruption push moves forward
With the Biden administration announcing an anti-corruption task force in Central America, here is a summary of some other recent commentary on anti-corruption efforts in the region.
There have been a range of anti-corruption issues in the news in recent weeks and I wanted to highlight two of them today. The recent comments come as the Biden administration announced it will implement a regional anti-corruption task force.
The House Homeland Security Committee held a hearing last week on corruption in Central America. You can find the video here.
CFR’s Shannon O’Neil offered three recommendations with which I fully agree:
When necessary, the US government should work around corrupt governments and institutions to provide aid directly to civil society.
The US should directly fund anti-corruption efforts including commissions and inspectors general to root out corruption.
The US should use its justice system to target corruption proceeds flowing through the US financial system. FinCen should dedicate resources to investigating Central American kleptocracy and any assets that the corrupt individuals have in the US that can be seized.
Welby Leaman of Walmart offered thoughts on how the private sector should contribute to the anti-corruption efforts and what would bring greater private sector cooperation. In his comments, he highlighted the importance of going beyond investigations and prosecution capabilities and focusing on improving anti-corruption efforts among “upstream” regulators - Tax, Customs, Permitting and Public Procurement - where a lot of corruption happens. He also stressed that digital tools such as mandatory electronic invoicing could have a significant impact in preventing corruption and make supply chains for US companies more secure, transparent and compliant.
Council of the Americas released their third annual Capacity to Combat Corruption report that ranks countries based on three areas of anti-corruption: legal capacity to combat corruption, democracy and political institutions, and the strength and independence of civil society and media.
More important than ranking countries is tracking their efforts over time. On that front, Mexico, Brazil and Colombia saw the steepest drops in their ability to combat corruption in the past year.
For Brazil, the report authors pointed at Bolsonaro’s politicized appointments and the end of Lava Jato as well as general declining democratic conditions under the current administrations. In Mexico, there are questions about the independence of the anti-corruption institutions and a lack of progress on actual corrupt cases in spite of AMLO’s rhetoric. Some of that politicization in Mexico can be seen in AMLO’s plan to hold a referendum in the coming months on the question of prosecuting past administrations.
In both Brazil and Mexico’s case, Brian Winter and Geert Aalbers highlight the fact that the presidents promised to crack down on corruption during their campaigns but have failed to implement institutional reforms. The caudillo mentality runs contrary to real anti-corruption efforts.
Colombia has seen weak reform efforts on campaign financing and concerns about public procurement surround the pandemic. While there is some pending legislation that would improve the situation, the current political environment makes it difficult to pass any reforms.
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One more thing. In Thursday’s newsletter for paying subscribers on the situation in Nicaragua, I commented that I thought the Biden administration should include Nicaragua in its regional anti-corruption efforts.
It will be a hard task given the repression and lack of cooperation by the Ortega regime, but it’s worth doing for at least two reasons. First, exposing corruption weakens Ortega and strengthens the case for additional multilateral sanctions that can have an impact. Second, it will be a case study for how such a task force can function effectively even if governments refuse to cooperate, and that could be a useful message to send to the region and the world.
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Have a great afternoon.