Corruption undermines governments’ ability to protect people and erodes public trust, provoking more and harder to control security threats. On the other hand, conflict creates opportunities for corruption and subverts governments’ efforts to stop it. Even countries with high CPI scores play a role in the threats that corruption poses to global security. For decades, they have welcomed dirty money from abroad, allowing kleptocrats to increase their wealth, power and destructive geopolitical ambitions.
Transparency International
Last Tuesday, ExxonMobil reported a record-breaking net profit of US$56 billion in 2022, surpassing its previous record of US$45.2 billion in 2008 when oil prices soared to US$132 per barrel. This prompted the White House to express outrage, noting that the profit margin was particularly “galling” at the time when Americans are paying high prices at the pump. The White House further stated that that oil companies have everything they need to increase production, including thousands of unused permits. Instead, they are choosing to ‘plow those profits into padding the pockets of executives and shareholders’.
Other major oil companies are expected to follow suit in the midst of high prices and soaring demand, with a combined estimated net profit of nearly US$200 billion, inclusive of the amount declared by Exxon. There have been calls for more countries to join the European Union and other countries to tax the windfall profits of oil companies. See https://www.reuters.com/business/white-house-outraged-by-exxons-record-profits-2023-01-31/#:~:text=WASHINGTON%2C%20Jan%2031%20(Reuters),the%20entire%20Western%20oil%20industry; and https://www.theguardian.com/business/2023/jan/31/exxon-profits-2022-western-oil-industry-record.
In Guyana, there have been calls from a wide cross-section of society for the Petroleum Sharing Agreement with ExxonMobil to be renegotiated. This is in view of the fact that the Agreement is overwhelming weighted in favour of the U.S. oil giant, especially as regards recoverable costs, ring-fencing provisions, royalty payments, profit-sharing, and the generous fiscal concessions granted. However, the authorities have so far refused to entertain such a thought. We have argued on numerous occasions that our natural resources belong to our citizens, both present and future, and should be exploited in a manner that we derive the maximum possible benefit thereof. Instead, what we are receiving is a mere pittance. Yet, we revel in our belief and behaviour that our country will soon become the Dubai of South America and the Caribbean, with unprecedented growth; while at the same time we fail to pay the desired attention to the performance of the non-oil economy which makes a real difference to the lives of ordinary Guyanese. These considerations apart, it is only reasonable that we should demand that Exxon shares some of its windfall profits with us via taxation.
Two Sundays ago, the UK Prime Minister Rishi Sunak dismissed Conservative Party chairman and a former Chancellor of the Exchequer Nadhim Zahawi after an ethics inquiry found that he had committed a serious breach in relation to the disclosure of his tax affairs. The inquiry found that Mr. Zahawi showed ‘insufficient regard for the general principles of the Ministerial Code and the requirements in particular, under the seven Principles of Public Life, to be honest, open and an exemplary leader through his own behaviour’. At the time of his appointment as a Minister, Mr. Zahawi failed to disclose that he was investigated by the HM Revenue & Customs that led to an estimated £4.8 million settlement, inclusive of penalty.
During the debate on the 2023 Estimates, the Speaker of Guyana’s National Assembly considered the use of the words “corruption” and “incompetence” as unparliamentary language. Accordingly, he banned their use in the deliberations of the Assembly. The background to this ruling was the mention of a quotation from former United States President Barack Obama that begins with ‘Those who cling to power through corruption and deceit and the silencing of dissent…’. At this point, the Speaker intervened.
Another comment that: ‘I’m reminded of a quote from Mark Twain, where he said let’s be thankful for fools because without them the rest of us wouldn’t be able to succeed’, was left to stand. It has been suggested that the Speaker might not have heard the latter comment as the parliamentarian’s microphone was allegedly turned off.
In India, a new booklet was published in last July by the Lok Sabha Secretariat identifying 65 words that are considered unparliamentary language, including the words “corruption” and “incompetence”. This prompted the political Opposition led by Rahul Gandhi to dub the publication “A new dictionary for a new India”. Most of these words were often used in criticism of Narendra Modi’s Administration. The editorial of 14 July 2022 in Madhyamam newspaper had the following to say on the matter:
It is a truism that dictators do not like criticism. The new ban list includes words that connote authoritarianism. Freedom to dissent is the essence of democracy…It is some time since the national media has become a nest of those reveling in servitude. Not only does the media stop short of criticism, but they also hide criticism and those who criticise.
See https://english.madhyamam.com/opinion/editorial/a-parliament-running-short-of-words-1042304.
Last Tuesday, Transparency International (TI) issued its Corruption Perceptions Index (CPI) for 2022. The results show that most of the 180 countries surveyed failed to bring about improvements in their scores and ranking, and hence a reduction in corruption. While the global average remained unchanged for over a decade at just 43 out of 100: (i) more than two-thirds of countries scored below 50; (ii) 26 countries fell to their lowest scores yet; and (iii) 155 countries have made no significant progress against corruption or have declined since 2012.
Corruption in perspective
Corruption in the public sector is generally considered the abuse, misuse or manipulation of power by public officials for private gain. In doing so, the public interest is sacrificed in favour of their personal interests as well as those of their relatives, friends and other close associates. In the Foreword to the United Nations Convention Against Corruption (UNCAC, former Secretary-General of the United Nations, the late Kofi Annan stated as follows:
Corruption is an insidious plague that has a wide range of corrosive effects on society. It undermines democracy and the rule of law, leads to violations in human rights, distorts markets, erodes the quality of life and allows organized crime, terrorism and other threats to human society to flourish…It hurts the poor disproportionately by diverting funds intended for development, undermining a Government’s ability to provide basic services, feeding inequality and injustice and discouraging foreign aid and investment. Corruption is a key element in economic underperformance and a major obstacle to poverty alleviation and development.
Corruption is cancerous, eating away at the very fabric of society. It is an immoral and unethical act that is committed by those in power and influence in furtherance of their own personal interest at the expense of the poor, the disadvantaged and other the vulnerable groups, including the unemployed, the sick and the elderly. Corruption results in the misallocation of scarce resources, and areas that are in genuine need of assistance are overlooked in preference to programmes and activities that offer the greatest rewards to the corrupt. High levels of corruption result in not only a distortion of trade but also goods and services becoming more costly, thereby adversely impact on the quality of life and the standard of living of citizens, especially middle- and low-income and other vulnerable groups. Research has shown that the corrupt politician tends to target major infrastructure works where there are large one-off payments and fewer officials involved, thereby rendering the risk of exposure less. Corrupt governments also tend to contract high levels of long-term public debt.
Measuring corruption
Given the opaque nature of corruption, it is extremely difficult to measure actual levels of corruption in a society. An alternative therefore had to be found that is generally acceptable, with the primary intention of creating an awareness of the adverse effects of corruption and providing a basis for actions to be taken to bring about improvements. It is against this background that the Corruption Perceptions Index (CPI) was developed. The Index is calculated based on surveys carried out of the perceptions of knowledgeable people, such as senior businessmen and political country analysts, of perceived levels of corruption in a country. The results, when computed using statistical methods, correlate well and provide some confidence about the actual levels of corruption.
Countries that share a deep concern for good governance, transparency and accountability, view the index as an important measure in their fight against corruption. An improvement in a country’s CPI score as well as its ranking is considered an indicator of a reduction in the level of corruption.
The first step in the fight against corruption therefore must be the acknowledgement of the existence of corruption and the extent to which it is perceived to exist. The failure to do so will only serve to embolden those who are bent on indulging in corrupt behaviour that enriches the few at the expense of the vast majority of the citizens.
The 2022 CPI results globally
The countries that continue to score well on a scale of 0 to 100 are: Denmark (90), Finland (87) New Zealand (87), Norway (84), Singapore (83), Sweden (83), Switzerland (82), Netherlands (80), Germany (79), Ireland (77), Luxemburg (77), Hong Kong (76), Australia (75) and Canada (74). On the other hand, countries that scored poorly are: Somalia (12), Syria (13), South Sudan (13), Venezuela (14), Yemen (16), Libya (17), North Korea (17) and Haiti (17).
The United Kingdom has shown a significant decline on the Index, dropping seven places in its ranking and five percentage points on its score, the biggest slide among the Group of Seven countries. This was due mainly to ‘a string of political and public spending scandals’ that enveloped the nation over the last year or so. Qatar, which faced European bribery allegations and complaints about poor working conditions as hosts of the 2022 FIFA World Cup, also dropped nine spots from 31 to 40 with a score of 58. Other significant decliners include Russia (27), Myanmar (23), and Haiti (17).
CPI results for the English-speaking Caribbean
For the English-speaking Caribbean, Barbados and the Bahamas continue to top the list with scores of 65 and 64, respectively, with Guyana and Trinidad & Tobago jostling once again for the bottom place, scoring 40 and 42, respectively, as shown at Table I with comparative scores in the previous six years:
Among the CARICOM countries, Guyana is competing with Suriname (40) for the bottom place, excluding Haiti which is a war-torn country currently engulfed in civil unrest. Haiti’s score declined from 20 to 17. Guyana has once again been relegated to the bottom of the table of English-speaking Caribbean countries, a position that it held since 2005 when it was first assessed, except for 2020.
In 2012, Guyana’s CPI score was 28 out of 100. Eight years later, it moved to 41. This 13-point increase occurred mainly during the period 2016-2020 when its score increased from 29 to 41. The largest increase was in 2016 when Guyana scored a five-point increase, moving from 29 to 34. This enhanced performance was mainly due to several anti-corruption initiatives undertaken. We had stated on several occasions that Guyana has the potential to build on this improved performance if it could intensity its efforts to improve its governance, including transparency and accountability, and ensure appropriate disciplinary actions are taken against those found guilty of undermining such efforts. In this regard, we had estimated that within five years it would have been able to achieve the 50 percent mark on the CPI. Regrettably, the events following the 2018 vote of no confidence in the Government marred any efforts to do so.
The present Administration is half way through its term of office, during which period there is a net decline of one percentage point. It therefore needs to intensify efforts aimed at bringing about an improvement in Guyana’s score and ranking on the CPI. The area of most concern relates to the award of contracts for the procurement of goods/services and works, and the effective monitoring of their execution to ensure good value for money is achieved. Next week, we will discuss the key steps needed to bring about improvements in Guyana’s score and ranking on the CPI.
