Remarks of
Antonio Maria Costa
Director-General, United Nations Office at Vienna
and Executive Director Office on Drugs and Crime
to the
National Conference for "Cleaner Public Life"
Budapest
20 and 21 March 2003
The holding of a meeting of this sort demonstrates only too clearly your commitment to making a difference in addressing corruption. I laud your efforts in this regard.
A key step in fighting corruption, in my experience, is both the acknowledgement that there is in fact corruption there to fight and addressing the problem in an open and transparent way. This Conference fulfills both criteria.
Identifying just how much corruption occurs in any society or around the globe is difficult to quantify. You are all familiar I am sure with Transparency International's corruption perception index, which, -while useful- tells us only about the perceptions of corruption, not an objective evaluation of its actual extent.
One way, however, to illustrate the potential extent of corruption is to examine the entries "Errors and Omissions" in the International Financial Statistics published monthly by the International Monetary Fund. This data provides a stark reminder of the all-too frequent instances when the unaccounted segment of a nation's external transactions represent an unacceptably high percentage of its balance of payments. There are cases when one half, even three/quarters of a country's balance of payments' position have gone unexplained.
It would of course be simplistic to explain high "Errors and Omissions" entries in a country's balance of payment statistics as the sole consequence of corruption. Yet, it has been shown that a significant inverse correlation exists between the accuracy and integrity of a country's national accounts on the one hand, and the presence of corruption on the other.
International statistics aside, we are only too familiar with the fact that the national wealth of a number of countries have been used only for the benefit of a few to the detriment of all citizens.
High level and systemic corruption has impoverished entire economies. Proceeds in the hundreds of millions, and in some cases, billions of dollars are moved by corrupt officials to foreign countries beyond the effects of the economic chaos they have created at home. When good government is restored, officials then spend decades attempting to retrieve funds that may be critical to repairing the social and economic damage.
Fighting corruption therefore must be a priority. It is a condition for good governance and rule of law, which in turn are the foundation stones of sustainable development.
Work done by UNODC shows that the manifestation of corrupt practices in public life, and the lack of effective institutions to counter it, has long-term detrimental effects on sustainable development. The result is a reduced quality of life for citizens, including those groups, such as the poor, women and children, most vulnerable to economic decline.
There is little doubt, therefore, that corruption represents one of the most significant challenges to the international community today, and that the fight against corruption requires an international response. In fact, not only the acts of corruption often have a transnational dimension, but many countries are not able to deal with the problem without assistance.
Companies that do business internationally can achieve unfair advantages by paying bribes or secret commissions in exchange for preferential treatment. Most have now come to recognize that this is not in their long-term interest: Economic efficiency is undercut and the cost of doing business increases, benefiting only corrupt officials.
The use of bribery is also always a slippery slope - once implicated in a corrupt practice it is difficult for either party to withdraw.
To persuade companies not to compete through the use of corrupt practices, however, requires reassurance that competitors will also stick to the rules. This fact underscores the requirement for a global response to such problems.
'Integrity pacts' and similar arrangements among competing companies are helpful, but the real solution lies in the development of reliable international standards, at the global level.
Most cases of corruption involve interactions between the public and private sectors and, in the case of corporate corruption, the benefits are often felt by shareholders in developed countries, while the costs are suffered by ordinary people in the developing world.
More fundamentally, it is citizens in developing and transitional societies who must live under the inadequate governance and corrupt bureaucracies that are nourished by such corruption.
Given the seriousness of corruption as a problem, and the requirement now for a more globalised response, we find ourselves at a critical juncture in the struggle to control transnational criminal activity such as corruption. This is a global problem requiring a global solution.
As a result of efforts on the part of the Council of Europe, OECD and OAS in recent years, the international community has embarked on the search for standards that are comprehensive in scope and global in application. These efforts will soon result into the UN Convention against Corruption, which is presently being negotiated in Vienna by an Ad Hoc Committee, supported by my Office.
The General Assembly, which established the Ad Hoc Committee, also gave clear and broad terms of reference, including the completion of this endeavour by the end of next year. While such a global instrument was unthinkable only a few years ago, the negotiations are now under way on the basis of a consolidated text compiled from proposals submitted by more than 25 countries, from all regions of the world. These proposals cover issues such as public and private corruption, preventive measures and asset recovery, as well as criminalization, international cooperation, technical assistance and monitoring of implementation.
The multitude and wealth of the proposals are evidence of the interest and commitment of all countries to be actively engaged in the negotiating process. Given the universal nature of the new instrument, such support is a key component of its future effectiveness, acceptance and success.
The Office for Drug Control and Crime Prevention stands ready to play a key role as a focal point at which those involved can come together.
Countries come to us to negotiate both legally binding instruments and normative standards. We bring together regional organizations and organizations dedicated to specific social, economic and crime issues, as well as entities within the United Nations System dealing with development, human rights and other relevant matters.
UNODC also serves as a repository for research, compiling and analyzing global trends in crime and drugs, helping countries to understand how their own problems are shared with and connected to those of other countries. Most important of all, we offer our Member States the technical assistance they need to put in place the measures required to fight financial fraud and corruption.
The Global Programme against Corruption (GPAC) was established in 1999 in response to global developments and an increasing need on the part of States for support in their anti-corruption efforts.
The Programme aims at helping Member States in preventing and controlling corruption through:
Since 2000 GPAC, in collaboration with Transparency International (TI) and the British Department for International Development (DFID) supports Chief Justices from Common and Civil Law Countries, the Judicial Group, in identifying and applying best practices in strengthening judicial integrity and capacity.
The outcome of this process has been (i) a list of key objectives for judicial reform; (ii) a set of measurable performance indicators, (iii) a comprehensive assessment methodology for judicial integrity and capacity; (iv) a draft Universal Declaration of Judicial Conduct and (v) a "safe" and productive learning environment for chief justices in which they can be exposed to best practices regarding judicial reform, management of change and the strengthening of the rule of law
The UN advocates an approach that is based on facts, inclusive, multi-partisan, comprehensive, transparent and impact oriented.
On the basis of these basic principles, there are four basic arenas in which action can be taken against corruption within a country:
First, the basic institution of good governance needs to be strengthened. At the head of this list is the judiciary, which is itself the guardian of laws and integrity. But if the judiciary is itself corrupt, the problem is compounded and the public at large without rule of law.
Second, the capacity and integrity of enforcement need to be enhanced. The best law has no value if it is not enforced. The best judges and magistrates are wasted if cases are never brought to them. Good investigations are wasted effort if the judge or magistrate is corrupt.
Third, a government needs to put in place a solid set of preventive tools. Codes of Conduct and strong independent oversight bodies can help ensure that the acceptable standards of behaviour are respected in both the private and public sector. Political leaders in all branches of government, legislative and judiciary can be required to have transparency in their own financial dealings through asset disclosure for themselves and their family members.
Fourth, the public needs to be educated on the advantages of good governance. It must also be clear that the public itself bears a large share of responsibility for insisting on honesty and integrity in government and business. The public needs to learn: (a) not to let anybody buy their vote; (b) not to pay bribes themselves; (c) to report incidents of corruption to the authorities; and (d) to teach their children the right values.
Let me emphasize that Hungary is one of our "Pilot Countries" in what we call an Action Learning Process. As it is always nicer to learn from success than failure, I sincerely hope that Hungary will continue to be a "model" of best practice country in the region.
As we all need this "light at the end of the tunnel", showing that it is indeed possible to build integrity to curb corruption, I extend my best wishes to your National Conference. I am sure it is a critical step towards "Cleaner Public Life" in your country. You are to be congratulated for the commitment and openness which characterize the holding of a meeting such as this.
Although its impacts are perhaps more visible today in a globalising world, corruption is not a new problem, and if you ask us to solve it tomorrow, then perhaps we must be pessimistic.
We do not expect to solve it tomorrow. I do, however, expect the international community to rise to the challenge of dealing more effectively with this global challenge, and in this I am very much an optimist.
I thank you.