2001 - 2002
Report to Congress Pursuant to the International Anticorruption and Good Governance Act (Public Law 106-309)
[Released April 2002]
TABLE OF CONTENTS
- Federal Republic of Yugoslavia
"The corruption of government institutions threatens the common aspirations of all honest members of the international community. It threatens our common interests in promoting political and economic stability, upholding core democratic values, ending the reign of dictators, and creating a level playing field for lawful business activities."
President George W. Bush Statement to the Second Global Forum, The Hague, May 2001.
"As we enter the 21st Century, more people throughout the world are rejecting the notion that corruption is inevitable. Success depends on impartial democratic institutions, open elections, and an unfettered access to information. Success also requires leadership by the private sector and active participation by citizens. Promoting integrity in government and the marketplace improves the global governance climate, nurtures long-term growth, and extends the benefits of prosperity to all people."
Secretary Colin L. Powell Remarks on "Fighting Global Corruption: Business Risk Management" May 2001.
A. Fighting Corruption: A Renewed Priority
The issue of corruption remains a matter of increasing importance to the United States, other governments, inter-governmental organizations and non-governmental organizations (NGOs) all over the globe. Corruption is a tax on development. It destabilizes critical rule of law and market-based institutions that underpin democracy throughout the world. Corruption distorts the operation of free markets, impairs economic stability and growth, jeopardizes privatization and economic restructuring, is a serious disincentive to foreign investment and undermines free and fair competition. Corruption undermines sustainable development and poverty alleviation efforts, diverts foreign assistance resources from their intended targets and becomes a disincentive to continued aid. As an impediment to development and democracy, corruption has captured the attention of the donor nations, international organizations, and international financial institutions.
The United States Government (USG) has taken bold steps in the past year to maintain leadership in the international fight against corruption. President Bush, Attorney General Ashcroft and Secretary of State Powell have forcefully articulated that the fight against corruption is an important foreign policy objective for the USG. This commitment was made clear during the Second Global Forum for Fighting Corruption, which was hosted by the Dutch at The Hague in May 2001 and was attended by high-level officials from 143 nations.
Following the events of September 11, the commitment to fight international corruption assumed a new sense of urgency. Poor governance and corruption help create the economic and social conditions that can breed disillusionment and nurture fanaticism. Corruption's role in crime and terrorism makes it a concern for law enforcement and security officials of many nations. Terrorists thrive on corruption. Terrorist groups utilize transnational organized criminals groups such as smuggling and trafficking networks, to finance their activities. Corrupt officials, knowingly and unknowingly, aid terrorists by facilitating the illicit laundering of funds and illicit trade of weapons, passports, drugs, and persons. Terrorists also use bribes to obtain sensitive information from government sources. Corruption can facilitate terrorism by helping terrorists move across borders and find safe havens.
Noting this important correlation, the USG has responded by integrating the fight against corruption into our efforts to address crime and terrorism. This is illustrated by Congress' passage of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism, (USA Patriot Act) Act of 2001, H.R. 3162. The USA Patriot Act establishes stricter "know your customer" rules, placing additional responsibilities on financial institutions to ensure that corrupt foreign officials do not use the U.S. financial system to hide illicitly acquired assets. The USA Patriot Act also established foreign corruption as a predicate offense for money laundering under U.S. law.
The USG is working to encourage other countries to adopt similar measures, participating in the UN negotiations for a new global anticorruption convention. The Administration has also begun to closely link the fight against corruption to international donor and aid efforts. At the UN-sponsored Monterrey Conference on Financing for Development in March 2002, President Bush announced the creation of a new Millennium Challenge Account that will provide billions of dollars of increased aid for development to countries that are committed to addressing corruption and good governance, promoting sound economic policies, and respecting human rights. Due to the leadership of the USG and developing countries, anticorruption became a key focus of the Monterrey Conference. It will continue to be a major issue as global leaders prepare for the World Food Summit (June 10-13, 2002), the G-7/8 Summit (June 27-28, 2002), and the World Summit on Sustainable Development in Johannesburg (August 26-September 2, 2002).
Despite our leadership in this area, USG diplomatic and multilateral initiatives will succeed only if governments and the private sector take the necessary actions to build institutional capacities to prevent and deter corruption in their countries. The political will of individual governments is crucial. USG technical assistance continues to play a role in helping countries take these crucial local actions. The primary responsibility and actions for addressing corruption must take place within each country's borders and be spearheaded by the respective government and its people.
B. The International Anticorruption and Good Governance Act
In response to growing awareness and concern about corruption, Congress passed the International Anticorruption and Good Governance Act of 2000 (IAGGA) on October 5, 2000, which was signed into law as part of Public Law 106-309 on October 17, 2000. The purpose of the IAGGA is "to ensure that United States assistance programs promote good governance by assisting other countries to combat corruption throughout society and to improve transparency and accountability at all levels of government and throughout the private sector," (IAGGA, �202(b)).
The IAGGA defines anticorruption programs broadly, involving action to:
- "support responsible independent media to promote oversight of public and private institutions;
- implement financial disclosure among public officials, political parties, and candidates for public office, open budgeting processes, and transparent financial management systems;
- support the establishment of audit offices, inspectors general offices, third party monitoring of government procurement processes, and anticorruption agencies;
- promote responsive, transparent and accountable legislatures and local governments that ensure legislative and local oversight and whistle-blower protection;
- promote legal and judicial reforms that criminalize corruption and law enforcement reforms and development that encourage prosecutions of criminal corruption;
- assist in the development of a legal framework for commercial transactions that fosters business practices that promote transparent, ethical, and competitive behavior in the economic sector, such as commercial codes that incorporate international standards and protection of intellectual property rights;
- promote free and fair national, state, and local elections;
- foster public participation in the legislative process and public access to government information; and
- engage civil society in the fight against corruption," (IAGGA, �205).
The IAGGA amended the Foreign Assistance Act, adding to the list of major goals for United States foreign development policy "the promotion of good governance through combating corruption and improving transparency and accountability" (IAGGA, �203). The law also authorizes the President to establish programs "that combat corruption, improve transparency and accountability, and promote other forms of good governance" in countries where the United States has either a significant economic interest or provides significant foreign assistance, and where problems of corruption are most persistent (IAGGA, �205).
The IAGGA further requires the Secretary of State, in consultation with the Secretary of Commerce and the Administrator of the Agency for International Development, to prepare a report to Congress that surveys USG diplomatic and programmatic anticorruption efforts, as well as host government efforts, in priority countries. The report, due annually, is to focus on activities of the previous year, while touching upon potential future activities in this area. The first annual report, submitted to Congress in April 2001, provides a detailed history of the international fight against corruption and the USG role in developing attention to the issue. This second report focuses exclusively on notable activities by the USG since issuance of the first annual IAGGA report.
II. USG ANTICORRUPTON DIPLOMACY AND RELATED INTERNATIONAL INITIATIVES
As discussed at length in last year's IAGGA report, the topic of corruption has only recently begun to be accepted as an issue of global concern with internationally accepted remedies for preventing and attacking it. The USG anticorruption diplomacy goals have been to establish internationally accepted norms relating to good governance (including corporate governance) and corruption, encourage mutual or self-evaluation of governments with regard to corruption within their borders, and to enhance cooperation and technical assistance involving the fight against corruption. Many other governments, including intergovernmental organizations, have come to share USG goals and we continue to work with them in their own impressive efforts.
The USG and other governments, through numerous international initiatives, are establishing the basis for much-needed intergovernmental assistance and cooperation. By acknowledging basic international norms regarding corruption and how to counter it, the doors for closer multilateral and bilateral cooperation are being opened. Countries are now cooperating in areas traditionally considered to be local problems, such as reforming a country's civil service, making a country's election systems or procurement processes more transparent, creating and operating intra-governmental auditing functions, or making decisions about how scarce law enforcement resources to target corrupt officials. This, in turn, encourages the sharing of best practices, builds trust and relationships between cooperating countries, and ultimately increases the effectiveness of USG and other assistance programs in these areas.
During the last year, this Administration has been actively involved in a number of activities to promote USG goals and intergovernmental cooperation. Specifically, the USG has supported the following key initiatives:
- The new Millennium Challenge Account ("the Account") will tie billions of dollars in extra U.S. foreign development assistance over the next three years to, among other factors, the recipient's commitments to good governance and anticorruption efforts. President George W. Bush, during the March 2002 speech that launched the Account, announced that the governments and NGOs around the world "must encourage developing countries to make the right choices for their own people." Since "good government is an essential condition of development...[the Account] will reward nations that root out corruption, respect human rights, and adhere to the rule of law."
- In January 2002, the United Nations (UN) began negotiations for a global anticorruption convention that will most likely include international standards for governance and prevention, commitments to criminalize certain corrupt behavior, and measures to improve international cooperation among governments in this area. The USG is actively participating in these negotiations, devoting significant effort to the issue of facilitating the recovery of assets that have been transferred abroad by corrupt officials including preventive measures to ensure that assets are not stolen and laundered in the first place.
- The Second Global Forum held at The Hague in May 2001 was strongly supported by the George W. Bush administration. The President provided a formal written statement and Attorney General Ashcroft led the USG delegation. Over 120 governments were represented at the ministerial level or above. All participants strongly denounced corruption and shared their experience with effective corruption preventive measures during an extensive series of workshops. The USG also sent a delegation to the NGO-sponsored 10th International Anticorruption Conference (IACC), held in Prague in October 2001.
The South Korean government will host both the Third Global Forum and the 11th IACC in 2003. The USG is working closely with the Korean government and IACC organizers to develop a combined and potentially biennial event. The event represents the largest and most important international gathering relating to corruption and is key for disseminating information on effective practices for the governmental and non-governmental communities to address corruption problems.
- The Organization for Economic Cooperation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials in International Business Transactions has been a long-term priority of the USG. The U.S. was the first country to criminalize the bribery of foreign public officials with the enactment of the U.S. Foreign Corrupt Practices Act (FCPA) in 1977. Since the negotiation of the convention in 1997, almost all of its 35 signatories have ratified the convention and enacted laws criminalizing the bribery of foreign public officials. The U.S. plays a key leadership role in promoting the implementation and enforcement of the convention in the OECD Working Group on Bribery, which is composed of signatories to the convention and is charged with monitoring its implementation. The Working Group has almost completed Phase I of the monitoring process, during which it examined countries' laws implementing the convention. Last year, the Working Group began Phase II of the monitoring process, which consists of on-site visits to capitals to ensure that countries have adequate enforcement mechanisms to carry out their obligations under the convention. In March 2002, Working Group examiners visited the U.S. to monitor its enforcement of the FCPA. The Working Group will review and complete the Phase II evaluation of the U.S. at the Working Group meeting in June 2002 at the OECD. The USG is continuing to encourage the expansion of the convention to include the bribery of foreign political parties, party officials, and candidates for office, which is covered under the FCPA but not directly under the convention.
- The Inter-American Convention Against Corruption, negotiated in 1996 under the auspices of the Organization of American States (OAS), continues to be a top USG priority. The OAS and the 25 participating States Parties to the convention, which includes the USG, created a formal follow-up mechanism to monitor implementation of the convention's commitments. States Parties met in Buenos Aires in May 2001 and adopted the Report of Buenos Aires, which creates general guidelines for the evaluation mechanism. In January 2002, representatives of the States Parties attended a Committee of Experts meeting at OAS headquarters in Washington to develop and adopt rules and procedures for the follow-up mechanism and first round assessment program. The Committee of Experts will meet again in May 2002 to initiate the formal evaluation process. The USG has provided technical assistance and financial support for this initiative.
- The Council of Europe's (CoE) Group of States Against Corruption (GRECO), a forum where the USG is an active participant, monitors the efforts of its 34 members to implement anticorruption principles and commitments. GRECO's standards are set out in the CoE's Twenty Guiding Principles, the Criminal Law Convention on Corruption (to which the USG is a signatory), and the Civil Law Convention on Corruption. The USG provides experts to conduct evaluations of other members, and is currently preparing for its own first round evaluation visit to be conducted by GRECO experts in June 2002.
- The Stability Pact Anticorruption Initiative (SPAI) for Southeast Europe is an intergovernmental effort led by the Europeans. The USG supports the initiative through assistance programs and in the policy discussions of the Steering Committee. The compact aims to facilitate cooperation between countries and major international organizations to help foster stability in the region of Southeast Europe. SPAI completed formal evaluations of the anticorruption regimes of six Southeast European nations. The USG will host a Steering Group meeting in Washington, D.C. in April/May 2002 to help channel technical assistance and donor aid to address weaknesses identified by evaluators.
- The OECD/ADB (Asian Development Bank) Anticorruption Compact was signed in November 2001 in Tokyo, Japan by seventeen nations. The USG has formally supported efforts by the OECD and Asian Development Bank to promote an anticorruption compact for the Asia-Pacific region. Similar to the SPAI compact, participating governments commit to take certain measures to prosecute, investigate, and prevent corruption. The USG, in cooperation with OECD and ADB, is providing technical assistance to help several participating countries implement the good governance guidelines under this compact.
- The USG continues to encourage and support several important regional anticorruption efforts in Africa. Notable regional initiatives include the Organization of African Unity (OAU) draft Protocol Against Corruption, the Southern African Development Community (SADC) Protocol Against Corruption and the Twenty-five Anticorruption Principles of the Global Coalition for Africa (GCA). The USG also expects to work closely on good governance issues with the New Economic Partnership for Africa's Development (NEPAD).
- At the March 2002 Monterrey Conference, the theme of anticorruption became an important international focus, due largely to the efforts of the USG. In addition to the President's appearance at the last day of the session, several high level USG officials participated in a number of corruption related sessions and workshops. For example, the Global Corporate Governance Forum, the OECD, the World Bank and several bilateral donors co-sponsored a side-session on "Anticorruption and Corporate Governance: Tools for Financing Development." In a special address at this session, Mr. Fetus Mogae, President of Botswana stated, "corruption is a global problem and a social evil. But reform is not a solution imposed by the West, it is a solution demanded by the poor who suffer the consequences every day. Transparency, accountability, responsibility - these are the watchwords of corporate governance, and these are the principles that enable us to tackle corruption." The USG also participated in a Monterrey 'Finance for Development (FfD)' session with civil society activists from developing countries to discuss the development of legal mechanisms, such as those being considered in the current negotiations of the UN Convention Against Corruption, to prevent public funds from being diverted to private foreign bank accounts of corrupt officials.
- The USG and other international donors will continue to encourage the World Bank and regional development banks to make anticorruption a major policy focus of their activities and lending practices. The USG is funding World Bank anticorruption diagnostics for several countries. As a member of the World Bank/OECD Global Corporate Governance Forum, is working with the international financial institutions and private sector to promote good corporate governance.
- The USG has begun taking the lead to promote the connection internationally between good corporate governance and a government's fight against corruption. An interagency working group on corruption and corporate governance is ensuring coordination among the international programs of various agencies to promote corporate good governance.
- The USG continues to lead efforts to promote the role of civil society in the fight against corruption. This work takes the form primarily of technical assistance and funding for such organizations throughout the world. In several countries, the USG is promoting formal partnerships between government and civil society relating to the fight against corruption.
III. SELECT USG ANTICORRUPTION ASSISTANCE PROGRAMS
The IAGGA acknowledges that a holistic approach to USG foreign anticorruption assistance in a wide range of areas is the key to combating corruption. Numerous USG agencies - including the Agency for International Development (USAID), the Department of State, the Department of Justice (DOJ), the Department of Commerce (DOC), the Department of Treasury (DOT), and the Office of Government Ethics (OGE) -- provide assistance to foreign governments and counterparts within the anticorruption assistance categories mentioned by the IAGGA. USG technical assistance programs are designed to strengthen legal and regulatory frameworks, building institutions and enhancing capacities through regulations and enforcement. USG technical assistance programs also help to cultivate a viable civil society where it does not already exist, creating a partnership between the public and private sectors to fight corruption. These programs promote transparency and accountability to ensure that the rule of law and market based economics take root, supporting democratic institutions and a sound private sector. This chapter describes recent USG programs and corresponding host government efforts in eleven countries where the USG conducts anticorruption programs and that meet the parameters of priority countries as outlined in �205 of the IAGGA.
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) provides technical assistance to the Government of Armenia (GOA) law enforcement officials in the area of investigating and prosecuting crimes that involve public and private corruption. INL provides additional funding for an INL program coordinator who coordinates USG ethics and anticorruption training to Armenian police and law enforcement officers, to promote professional responsibility and develop investigative methods and procedures that lessen the effects of corruption on the investigative, arrest, and prosecutorial systems. GOA law enforcement personnel are also exposed to anticorruption methods and principles through the core law enforcement course at the International Law Enforcement Academy (ILEA) in Budapest.
INL also funds an American Bar Association - Central and Eastern European Law Initiative (ABA-CEELI) criminal law reform program, which provides anticorruption assistance to GOA through a regional anticorruption advisor and in-country liaison. The liaison has worked with the GOA to assess a draft law on anticorruption preventive measures and to support the development of a code of ethics for prosecutors. The U.S. Agency for International Development (USAID) funded ABA-CEELI Rule of Law program has supported the development of an Ethics Code for defense lawyers and an enforceable Code of Judicial Conduct.
In September 2002, USAID will conduct a combined rule of law/anticorruption assessment. The results of this assessment will help the USG to determine whether to continue to incorporate anticorruption as a crosscutting objective, develop a separate anticorruption activity, or do both. The goal is to develop a new country development strategy by fall, presented to Washington, D.C. in the spring and implemented starting October 2003.
This year, USAID assistance resulted in four significant new laws that will decrease the opportunities for corruption. USAID helped to draft the Law on Procurement and implementation rules and regulations. This law is expected to have corruption-curbing effects, as all GOA's procurements over $1,300 must now be competitively bid through an open and transparent process. To support the implementation of this law, USAID funded training for over 100 procurement officials and the publication of a comprehensive training manual with standard forms and contracts. The Law on the Registration of Legal Entities expedites the process for businesses seeking to register, lowers the cost of registration, and minimizes the opportunity for corruption by making the process short and transparent. An enforceable code of ethics for justices, for which USAID provided significant technical assistance, was passed on December 27, 2001. USAID had provided extensive assistance for the Customs Code, especially on customs valuations, country of origin, anti-dumping duties, and intellectual property. The Prime Minister issued a decree in April 2001 setting forth a plan for modernizing customs administration that drew largely on the recommendations from the customs diagnostic exercise performed with USAID assistance in March 2000. However the human dimension of tax and customs administration needs to be addressed, as corrupt behavior continues. In the future, USAID will focus more intensively on developing and implementing enforceable codes of ethics, training of tax and customs officials, and reviewing their compensation and career structures.
USAID helped to develop a national Information and Communications Technology (ICT) Master Strategy Plan, creating a more efficient and transparent government system that lays the foundations for developing a regional ICT hub in Armenia. USAID has advised the GOA on restructuring the institutions that regulate the telecommunications sector and provided expert commentaries on draft e-document and e-commerce laws. This should result in an improved, more transparent environment for business development.
Another major achievement in 2001 was completion of the installation of tamper-proof distribution and transmission meters and a Data Acquisition System (DAS) -- key steps in establishing a secure and accurate system for measuring network flows of power and ensuring an associated transparent system for managing sector financial flows. The meters and DAS have enabled system managers to identify and minimize energy theft, reducing corruption in the energy sector. USAID, through the Municipal Finance Officers Association, has provided training to municipal finance officers on a multi-faceted software system that improves budgeting and tax collection. Effective use of this system has enabled nine pilot municipalities to increase revenue collection by 30% on average and has also made budget information more accessible to the public. Local residents are able to review budget information and receive information about local government functions at USAID-funded citizen information centers.
In Spring 2001, the U.S. Department of Commerce (DOC), together with the domestic private sector, NGOs and U.S. businesses launched a business ethics initiative in Armenia that helps promote ethical business standards and strengthens integrity in the public and private sector. DOC will conduct a one-day business ethics workshop in the U.S. for an Armenian business and entrepreneurial group participating in the U.S. State Department's Community Connections Program. Currently, DOC is recruiting 3-5 Armenian professionals for its 2002 Business Ethics "Train-the-Trainer" program, which will instruct trainees on how to develop and implement business ethics programs and codes of business conduct for their businesses and organizations as well as train others. The training program is being supplemented with the development of a Business Ethics Manual.
The GOA is expected to announce it's Anticorruption Strategy in September 2002. In order to find a national voice in the fight against corruption, the GOA has teamed up with civil society and development partners to create this Strategy. An Anticorruption Strategy Expert Group, chaired by the Organization for Security and Cooperation in Europe (OSCE), has gathered international donors to ensure that our assistance supports the GOA's Anticorruption Strategy and to provide commentary on such themes as local governance, media and customs administration.
The GOA has been active in international anticorruption fora such as the Second Global Forum.
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL), responding to the request of the U.S. Embassy in Tbilisi to make anticorruption assistance our number one priority, provided a full range of assistance to the Government of Georgia (GOG) and its law enforcement agencies. INL provided funding and coordination for the development of a multi-agency forensic laboratory development project. The project aims to enhance the GOG's forensic capabilities, as well as, to assist the GOG in developing institutional checks and balances necessary to prevent corruption such as evidence collection and protection procedures, electronic case management systems, competitive hiring processes, and an independent law enforcement status that prevents other agencies from manipulating forensic science to facilitate other acts of corruption. INL provides additional funding for the Resident Security Officer (RSO) in Georgia to provide ethics and anticorruption training to Georgian police and law enforcement officers, to promote professional responsibility and develop investigative methods and procedures that lessen the effects of corruption on the investigative, arrest, and prosecutorial systems.
INL also provides funding for initiatives managed by the Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), a component of the Criminal Division of the U.S. Department of Justice (DOJ), to assist the GOG with a Resident Legal Advisor (RLA) and Anticorruption Specialist. The RLA had a primary role in providing legal assistance to the Anti-Corruption Coordinating Council (ACCC), which was created in April 2001 to oversee the implementation of Georgia's national anti-corruption strategy. The RLA works daily with the GOG Procuracy and Ministry of Justice, encouraging professional collaboration. In the case of the Procuracy, the RLA has assisted on various law enforcement issues, including the creation of a specialized unit of prosecutors and investigators within the prosecutor's office to handle the investigation and prosecution of corruption offenses and other economic crimes. The RLA has assisted in the reform of the Procuracy so that its organization and operation conform to international standards. In the case of the Minister of Justice, the RLA has assisted the drafting of legislation that places the burden of proof on GOG officials suspected of purchasing property with illegally obtained monies and the Law on Forensic Experts that promoted the process of cross-examination to qualify a forensic expert in court proceedings, removing the corrupt licensing process that had previously existed.
INL has funded the National Strategy Information Center (NSIC) to conduct culture of lawfulness training in Georgia. NSIC's training focuses on teaching school age children about civic culture and promoting principles of citizenship. A central element of NSIC's curriculum is to develop and internalize the resistance techniques necessary for citizens to make and carry out law-abiding decisions.
INL also provides funding for American Bar Association - Central and Eastern European Law Initiative (ABA-CEELI) criminal law reform program, which provides anticorruption assistance to GOG through an in-country liaison and a regional anticorruption advisor. The advisor provided advisory assistance to the working group tasked to make recommendations on ways to reorganize and streamlining law enforcement bodies. The liaison worked to review and revise the internal regulatory scheme of the Chamber of Control. The ABA-CEELI team worked to create and implementation of a pilot training project for auditors and inspectors focused on criminal case development techniques and procedures for referrals for criminal prosecution and, to establish procedures for the receipt and follow-up of economic crimes cases with the Procuracy.
The U.S. Agency for International Development (USAID) also provided ABA-CEELI funding for their Rule of Law (ROL) program, which assisted in the development of the new Code of Ethics to newly appointed judges. ABA-CEELI also worked with legal scholars and the Council of Justice to develop a bar examination for lawyers, which will be given in June, as preparation for the formation of a professional Bar Association. The ROL program began planning, with the Council of Europe (CoE) and the Organization for Security and Cooperation in Europe (OSCE), a Caucasus-wide conference to discuss Freedom of Expression in compliance with Article 10 of the European Convention. Working with the Association of Judges of Georgia, the ROL program began a review of the GOG's disciplinary process in order to suggest reforms to the process to help eliminate corruption in the judiciary.
USAID bases its anticorruption strategy on the recommendations prepared by the all GOG's Anticorruption Working Group. This strategy entails mobilizing civil society, particularly advocacy NGOs and the media, to reform the judiciary, liberalize the business sector, to demand transparency and accountability in GOG public agencies by increasing public participation in administrative decision-making. The cornerstone for implementing this strategy rests on the implementation of the Administrative Code. This Code, the most progressive in Eurasia, has a landmark freedom of information section and provides a legal point of entry for the public into the GOG's decision-making process. Administrative law represents a crosscutting substantive area of law that impacts all the USAID's activities.
In Spring 2001, U.S. Department of Commerce (DOC) launched a business ethics program in Georgia to promote the use of ethical business standards and strengthen integrity in the private sector. DOC will conduct a one-day business ethics workshop in the U.S. for a Georgian business and entrepreneurial group participating in the State Department's Community Connections Program. DOC is currently recruiting 3-5 Georgian professionals for its 2002 Business Ethics "Train-the-Trainer" program that will instruct trainees on how to develop and implement business ethics programs and codes of business conduct for their businesses and organizations as well as train others. The training program is being supplemented with the development of a Business Ethics Manual.
The GOG has been active in international anticorruption fora such as the Second Global Forum. The GOG is a member of GRECO (Group of States Against Corruption) and a signatory to the CoE Criminal and Civil Law Conventions on Corruption.
The U.S. Embassy in Guatemala City's Public Affairs Office (PAO) has provided anticorruption assistance to the Government of Guatemala (GOG). Specifically, the PAO has provided investigative and ethics training to local journalists. The goal of the training is to raise the level of awareness amongst Guatemalan journalists about the value added of ethical journalism. The training also focuses on ways to provide more extensive coverage of corruption problems in Guatemala.
To promote a more concerted national effort to fight corruption, the U.S. Agency for International Development (USAID) sent a delegation from the GOG to the 10th Annual IACC in Prague. This delegation included high-level GOG officials as well as representatives from civil society, the press and the private sector. This effort led to greater awareness of the problem of corruption in Guatemala, greater press coverage and more collaborative donor efforts to press the GOG to take clear steps to combat corruption. This dialogue led to President Alfonso Portillo's new National Initiative Against Corruption and his official request for a World Bank anticorruption program that will involve all sectors of Guatemalan society in the definition and implementation of priority actions that lead to a reduction in corruption.
USAID is providing assistance to support reform of the criminal justice system. A Clerk of Courts office was developed to ensure a more transparent case management system. The system aims to eliminated the practice of "losing" cases due to corrupt officials.
USAID has also supported the work of the GOG's Anticorruption Section of the Public Ministry that is charged with prosecuting criminal cases related to corruption. The program developed institutionalized legal training units for the Public Ministry, courts, and public defense with objective standards for personnel management and performance monitoring. The program has also supported the overhaul of the standardized practices and curriculum at the country's primary law school to address corrupt practices in the marketing of grades, private exams and the approvals of practicums such as clinical programs.
The GOG's National Controller General's Office, the Supreme Audit Institution that audits GOG entities and programs, has received USG assistance, which includes helping to develop ethics training materials. Members of the Controller General's staff are using these materials to provide ethics training to civil servants working throughout the Executive branch. In the same vein, USAID's Office of Inspector General (OIG), under the philosophy of working with Supreme Audit Institutions to develop their capabilities, has permitted the Controller General to audit USAID funds with the OIG performing quality control reviews of their work. This collaborative relationship should produce lasting benefits for the Supreme Audit Institution.
USAID is working with local governments to make more transparent their financial management and investment planning processes. Over 40 local governments participate in this program that includes an innovative mechanism called "accountability sessions." Quarterly, the mayor provides detailed information to the community on how municipal funds were spent during the last quarter and what the priority expenditures will be for the next quarter. Also, citizens are participating in newly created Municipal Planning Offices that work with communities in setting guidelines and overseeing municipal investment and planning decisions.
Guatemalan Civil Society Organizations receive technical assistance, training and grant funds through the USAID Civil Society Program specifically in the area of transparency/anticorruption. This program has provided support to the creation of a local chapter of Transparency International (TI-Guatemala), promoted reforms to the Civil Service Law to improve GOG efficiency and reduced levels of discretion in the use of public funds, and financed civil society oversight of the work of the Controller General's Office.
The GOG has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention. The GOG has ratified the OAS Inter-American Convention Against Corruption.
D. Federal Republic of Yugoslavia
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) has worked with Organization for Security and Cooperation in Europe (OSCE) partners in the Federal Republic of Yugoslavia (FRY) to provide basic police training, to develop a multi-ethnic police force in southern Serbia. The USG contributes four police trainers, one curricula development specialist and one police manager to the program. This program began in June 2001 and is expected to train 400 police officers by the end of June 2002 using a curriculum that incorporates human rights and community policing concepts. To date, nearly 300 new police officers have graduated from the program and are now deployed in three police stations in Presevo, Medvedja and Bujanovac under the supervision of Serbian police trained by OSCE to be field-training officers.
INL also funds the American Bar Association - Central and Eastern European Law Initiative (ABA-CEELI) criminal law reform program, which provides anticorruption assistance to Montenegro through an in-country liaison. The liaison furnishes technical legal assistance to Montenegrin institutions and NGOs to promote good governance, democracy, and human rights, through criminal law legislative reform, training and institution-building. The liaison assesses draft laws and provides advisory assistance on matters of anticorruption policy, such as laws on Public Procurement, Bankruptcy, and Conflict of Interests. The liaison has worked with the Montenegrin Anticorruption Commission to formulate an overall anticorruption strategy. The liaison has also furnished information on international conventions, treaties, and laws regarding anticorruption practices from all over the world.
The U.S. Agency for International Development (USAID) program in the FRY is designed to facilitate the transition to a market-driven and democratic society based on the rule of law. In both Serbia and Montenegro, USAID programs are helping to increase transparency and efficiency in both political and economic life, with an eye towards reducing the high levels of corruption that have plagued the FRY during its transition.
In Serbia, judicial training, commercial law, World Trade Organization (WTO) accession, bank reform and building civil society support are the critical components of the USAID's anticorruption efforts. The Serbian judiciary is struggling to overcome a ten-year legacy of neglect and abuse during which the Milosevic regime relied upon endemic corruption to perpetuate his rule. Since Milosevic's removal from power, the democratically elected reformers in Belgrade have made great strides. USAID partner ABA-CEELI is working with reform-oriented judicial institutions to increase judicial independence and efficiency through training and technical assistance. Judicial ethics seminars have been one of this project's most successful activities to date. These and other ABA-CEELI training activities will be institutionalized in the curriculum for a recently established Judicial Training Center. The project also provides assistance in crafting legislation and in vetting this legislation with citizens in an effort to open the legislative process to public comment.
USAID supports the development of commercial law and WTO accession through projects aimed at strengthening Serbia's commercial legislation and commercial courts. USAID supports training that will help to shrink the gray economy by establishing a more solid legal foundation for economic transactions. This assistance is complemented by a WTO accession project that supports Serbia's integration into Euro-Atlantic markets and organizations. This helps to address the sources of corruption by promoting the adoption and implementation of legislation and standards that help to reduce opportunities for the abuse or misdirection of public funds.
In Serbia, USAID continues to target corruption and financial crimes through projects targeting bank and non-bank regulation. Through enhanced and strengthened bank supervision, the Central Bank is better able to identify and detect instances of questionable transactions and money laundering. More capable Central Bank regulation, in conjunction with an U.S. Treasury Department implemented effort to improve enforcement action capacity in the Ministries of Finance and Interior, will jointly contribute to reducing financial crime and corruption in the FRY. As a result of this assistance, Serbian institutions have begun adopting new practices and procedures, including risk-based examination at the Central Bank. In addition, the Central Bank assisted in drafting recently adopted and much-needed federal legislation to combat money laundering.
USAID supports multiple NGO activities that educate the public about corruption. The National Democratic Institute (NDI) program, for example, supports the Center for Free Elections and Democracy in extending its acclaimed election monitoring activities and watchdog activities aimed at increasing transparency and reducing corruption.
In Montenegro, USAID assisted in the development of a broad set of legal and institutional reforms. These reforms encompass substantial anticorruption legislation, primarily in economic policy reform and implementation, as well as in local governance and rule of law. A new public procurement regulatory framework will mitigate an opaque procurement procedure that increases the cost of doing business. A Public Procurement Commission has been established and meets regularly. Public procurement officers have been appointed and their training is ongoing. Under the new Law on Local Self-Governance, fiscal responsibilities are decentralized in the realm of public procurement across all municipalities in Montenegro.
The Montenegrins are also working on a number of laws that will reduce opportunities for corrupt activities. The Law on Anti-Corrupt Practices and the Law on Anti-Money Laundering are under review by the Legislation Committee prior to submission to the regional Parliament. New Central Bank and commercial banking legislation has put in place stringent licensing standards, tight financial reporting requirements, and sound financial performance criteria. The Montenegrins have also committed to regularize the conditions for offshore banks, bringing them under the regulatory and supervisory authority of Central Bank of Montenegro. A series of new laws have been submitted to Parliament that will facilitate private enterprise and expansion of the market economy, including an anti-monopoly law that seeks both to make operating a business simpler and to increase the transparency of the rules and regulations that govern private investment and enterprise. Finally, the newly enacted Law on Courts established a rule of law framework from which to combat corruption. The legislation's supervisory Judicial Council is comprised of peers rather than Ministry of Justice functionaries, to oversee the judiciary, thereby promoting greater independence of the judiciary.
The FRY has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention and the Second Global Forum. The FRY is a member of Stability Pact Anticorruption Initiative (SPAI).
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) provides funding for initiatives managed by the Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), a component of the Criminal Division of the U.S. Department of Justice (DOJ), to assist the Government of Indonesia (GOI) by enhancing the skills of its prosecutors to handle complex criminal cases. The program involved a month of instruction on legislative drafting and multi-jurisdictional teamwork. A Deputy U.S. Marshall and an Assistant U.S. Attorney provided advice on how to develop a witness protection program and how to handle prosecutions with substantial elements of witness intimidation. The program was reinforced with an Intermittent Legal Adviser who remained in Indonesia for an additional six months to conduct an assessment of the GOI's Attorney General's Office.
INL also provided funding for OPDAT to send a judge and a prosecutor to Jakarta to assist a law enforcement working group at the University of Indonesia. The GOI's Supreme Court and legislature have tasked the working group to review and edit proposed new laws on the scope, responsibilities, practices and procedures of the police, prosecutor's office and the Supreme Court. A second team will return to Indonesia to work with the Indonesian Wealth Commission and GOI criminal justice officials to discuss issues of financial disclosure, professional responsibility and performance standards.
The U.S. Agency for International Development (USAID), in cooperation with the Asia Foundation, administered grants to programs that provide anticorruption related assistance. One grantee, a Lombok Island based NGO, mobilized their community to address corruption, collusion, and nepotism in the Province of West Nusa Tenggara. Communities have begun to demand that village leaders be more transparent in their official dealings and assume a more active role in disseminating information about development plans in their village. Another grantee focuses its work in Yogyakarta and Central Java, mapping out public service problems and priorities and creating a module for training community organizers who will help civil society groups engage local government on issues of accountability and corruption.
A Jakarta based legal research organization and grantee conducted a training program on corruption investigation. The training is expected to increase the capacity of Indonesian legal and anticorruption NGOs to investigate corruption cases. In the southern Sumatra province of Lampung, a USAID-funded organization, which has trained 158 "anticorruption volunteers" from around Lampung to monitor and investigate corruption cases, ran a publicity campaign against corruption in four area newspapers and monitored and investigated 86 separate cases of corruption that represented a total of Rp 106 billion ($10.6 million) to the province.
USAID is also promoting development of an independent regulatory body within the Ministry of Telecom. The program will help to improve market-based interconnection pricing, avoid monopolies, and improve transparency in the GOI decision-making process. Futures markets in Indonesia have traditionally involved much GOI intervention, which allows substantial opportunities for corruption. This oversight agency has established mechanisms to enforce adherence to laws and regulations, including procedures for vetting brokers and issuing licenses relying on "fit and proper" tests. USAID experts have been helping the GOI draft and review a new Law on Investment that will require one-stop registration and national treatment of investors.
USAID has been working with Bank Indonesia and the International Monetary Fund (IMF) to strengthen the supervision and regulatory network for banks and other financial institutions. USAID has contributed specifically to legislation creating new bankruptcy procedures, secured transaction rules, business competition rules, and arbitration systems. Much of these efforts assist Bank Indonesia to oppose bank secrecy rules, reduce special subsidized lines of credit for small and medium enterprises, and promote instead the development of market-oriented and deposit-based institutional development.
Working with Bank Indonesia, the GOI Ministry of Finance, the GOI Department of Justice and the Parliament, USAID provided assistance in the drafting and implementation of a new anti-money laundering law that was passed by Parliament in March 2002. USAID has also been working directly with the GOI Ministry of Finance on a wide range of trade/customs related issues, including the design of policy interventions that are less vulnerable to corruption. USAID is helping the Ministry design a process for trade policy development that is open and minimizes the participation of the corruption-prone GOI customs' bureaucracy. At the request of the GOI Tax Department, USAID delivered a "Blueprint for Tax Administration Reform." Implementation of the blueprint would improve openness, fairness and accountability in a number of areas, particularly relating to tax collections and audits.
Another USAID project focuses on reducing corruption in the courts by encouraging development of an independent unitary Bar Association and Bar Association code of ethics. The project also provides institutional development support for two GOI commissions that are officially charged with rooting out corruption, the Corruption Commission and the Commission for the Investigation of the Wealth of Government Officials.
In February 2001, USAID and its Office of Inspector General (OIG) signed an agreement with the Supreme Audit Institution (SAI) of Indonesia. After a review of its proficiency, independence and ability to meet acceptable levels of audit standards, the SAI was deemed eligible to conduct audits of USAID funding. In furtherance of the collaboration, OIG staff in Washington provided a briefing on performance auditing for visiting senior officials from the Indonesian SAI. The briefing covered several areas, including best practices, key performance indicators, audit agency procedures, and other performance audit operations. This briefing provided a unique opportunity to assist in building a new working partnership between the OIG and its GOI colleagues and builds upon the existing capacity of the SAI to audit GOI funds.
The GOI has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention and the Second Global Forum. The GOI is a member of the Asian Development Bank - Organization for Economic Cooperation and Development (ADB-OECD) Anticorruption Initiative for Asia-Pacific.
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) provides technical assistance to the Government of Kazakhstan (GOK) law enforcement officials in the area of investigating and prosecuting crimes that involve public and private corruption. INL also provides funding for initiatives managed by the Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), a component of the Criminal Division of the U.S. Department of Justice (DOJ), to assistance the GOK through a Resident Legal Advisor (RLA) to enhance the skills of their prosecutors to handle complex criminal cases. GOK law enforcement personnel also participate in the law enforcement-training course at the International Law Enforcement Academy (ILEA) in Budapest.
The U.S. Agency for International Development (USAID) has decided that it is essential to address corruption in Kazakhstan in order to achieve the program's strategic objectives and targets. USAID assistance emphasizes citizen participation in assistance activities, promotes expanding the role of NGOs in civic life, and helps establish democratic practices, including transparent and accountable governance, between and among the citizens and regional governments.
Special emphasis is put on supporting media freedom as a means of increasing citizen awareness. Local newspapers have reported on corruption allegations against GOK officials, and have drawn on USAID support when threatened with reprisals by the GOK. With USAID assistance, the GOK recently promulgated a decree requiring full compliance with international accounting standards and decreased the steps required to obtain licenses for new businesses by two-thirds. New procurement procedures for pharmaceuticals have also limited opportunities for kickbacks. USAID provides support for Transparency International's branch office and information center in Almaty.
USAID also provides funding for an American Bar Association - Central and Eastern European Law Initiative (ABA-CEELI) criminal law reform program that provides anticorruption assistance to the GOK. ABA-CEELI's in-country liaison facilitates a program for upper-level law students from the Kazak Young Lawyers Association (KYLA) who volunteer at the Ninth Section of the City Department of Internal Affairs anticorruption office. This section deals with economic and fiscal crimes and corruption, and is the successor to the former Soviet Department to Combat the Theft of Soviet Property. Each student has been assigned several cases and is acting as primary investigating lawyer on those cases. Students are preparing criminal complaints, interviewing witnesses and researching applicable laws. KYLA is providing significant assistance to an office that appears to be seriously concerned about corruption in local government.
U.S. Department of Commerce (DOC) is working with Organization for Security and Cooperation in Europe (OSCE), the GOK and the American private sector, and NGOs to promote good business practices and to strengthen integrity in the public and private sectors. The private sector and NGO representatives are working to develop guidelines for codes of business conduct. In February 2002, DOC conducted a one-day business ethics workshop in the U.S. for a business and entrepreneurial group from Kazakhstan participating in the Community Connections Program. DOC continues to provide information to the group on how to promote business ethics among small and medium size businesses in Kazakhstan.
DOC is currently recruiting 3-5 professionals from Kazakhstan to participate in its 2002 Business Ethics "Train-the-Trainer" program that will instruct trainees on how to develop and implement business ethics programs and codes of business conduct for their businesses and organizations as well as train others. The training program is being supplemented with the development of a Business Ethics Manual.
The GOK has been active in international anticorruption fora such as the Second Global Forum. The GOK is expected to join the Asian Development Bank - Organization for Economic Cooperation and Development (ADB-OECD) Anticorruption Initiative for Asia-Pacific.
Over the last 18 months, the Government of Kenya (GOK) has been working on an U.S. Agency for International Development (USAID) sponsored anticorruption reform program. This program has three core concentrations: legislative reform, advocacy, and measuring the impact and extent of corruption.
USAID is providing grants to two organizations, the local Chapter of Transparency International (TI-Kenya) and the Centre for Governance and Development (CGD) that have been leading legislative reform efforts to tackle corruption in Kenya. TI-Kenya has helped create a coalition of GOK Members of Parliament to establish the GOK Chapter of the African Parliamentary Network Against Corruption. This coalition has become the focal point of legislative reform efforts for an anticorruption law. The forerunner to this coalition was the Parliamentary Select Committee on Anticorruption, which was mandated to draft new anticorruption legislation and to identify the sources and extent of corruption in Kenya. CGD was central to the Parliamentary Select Committee's work and was deeply involved in the actual drafting of comprehensive anticorruption legislation. In addition, USAID provides ongoing parliamentary support through an institutional contractor.
Reducing corruption entails building effective anticorruption constituencies. USAID NGO grantees have been at the forefront of mobilizing a broad anticorruption lobby drawn from the private sector and civil society. The current coalition coalesced around TI's 10th IACC in Prague last October. This "Prague Group" now meets at least monthly. Members include the new head of the GOK Police Anticorruption Unit. A coalition conference is planned for mid 2002. These consultations are critical to building a broad anticorruption lobby in Kenya. Recently, for example, the Attorney General asked coalition members to critique a proposed anticorruption bill. He has now revised the legislation to reflect coalition comments. Prior to being published, the bill will soon be considered by the GOK cabinet. USAID expects these consultations to continue and to be strengthened in the immediate post-election period.
USAID programs have also sought to fill the tremendous need for reliable and credible information on corruption in Kenya. Without data, anticorruption constituencies are often hard to mobilize. For this reason, a core part of the program implemented by TI-Kenya and CGD has been dedicated to developing empirical data on corruption through research and development of reliable measures of its costs and impact. In terms of research, the CDG early last year published a survey of seven years of GOK waste. Culled from successive reports of the GOK Controller and Auditor General, this report details the actual costs, in cash terms, of financial laxity, illegal payments and corruption. This report was followed by TI's Harambee Report, which attempts to measure the amounts of all reported political contributions made through voluntary self help development activities. Both reports received extensive coverage in the media in Kenya, a crucial component of mobilizing a national sentiment against corruption.
In early 2002 TI-Kenya embarked on a process of tracking and measuring the extent of corruption through an empirical index. Modeled on TI-Berlin's Corruption Perceptions Index, TI-Kenya's index measures not perception but actual intensity and incidence of corruption. Dubbed the Kenya Urban Bribery Index, this index will provide a standard instrument for measuring the rise and fall of actual incidences of corruption over the years. The first report has been issued and widely publicized in the media. The Index is being refined and follow-up surveys will be issued periodically using this year's results as the baseline. Finally, TI-Kenya's website serves a valuable tool for sharing information. In the coming election year in Kenya, USAID is planning a series of activities to improve the transparency of spending on the campaigns, which may have a significant impact on the outcome of these critical elections. This program contributes to the overall set of activities that USAID is undertaking to enhance the transparency of the electoral process in this crucial transition year.
The GOK has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention and the Second Global Forum. The GOK is a member of the Organization of African Unity (OAU).
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) supports an initiative managed by the Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), a component of the Criminal Division of the U.S. Department of Justice (DOJ), and the Financial Crimes Enforcement Program, a component of the U.S. Department of Treasury's Office of International Affairs and Technical Assistance (DOT), to provide assistance to the Government of Nigeria (GON) in its fight against corruption. The project is designed to assist the GON's nascent Anticorruption Commission develop comprehensively its capacity to combat and prevent corruption. The project will provide specific criminal procedure, investigative, prosecutorial, and administrative skills development and technical assistance to Commission staff and other GON officials, including criminal prosecutors and investigators. The project will be implemented over a period of approximately 18 months.
In addition, INL is funding the National Strategy Information Center (NSIC) to conduct culture of lawfulness training in a few of the Nigerian States. NSIC's training focuses on teaching school age children about civic culture and promoting principles of citizenship. A central element of NSIC's curriculum is to develop and internalize the resistance techniques necessary for citizens to make and carry out law-abiding decisions.
The GON, the U.S. Agency for International Development (USAID) and the World Bank have been collaborating on a diagnostic survey that will be conducted by a consortium of Nigerian universities and will probe deeply into citizen experiences with corruption. Survey work has been completed, but not all the data for over 6,000 interviewees has been analyzed. Results will be used to launch a nationwide campaign raising the saliency of corruption and creating consciousness of how corruption affects the lives of ordinary citizens. Attitudes toward corruption were also addressed in the Afro-Barometer survey of attitudes toward democracy and markets. While dissatisfied with the GON's efforts to fight corruption, respondents still believed that a democratic government was less likely to be corrupt than a military government.
USAID is collaborating with the World Bank and International Monetary Fund (IMF) to address problems of economic mismanagement and corruption under successive military and civilian regimes. To ensure coordination in this area, USAID and the UN Development Program co-chair a donor consultative group on Nigerian governance projects. USAID and IMF worked to identify weaknesses in the GON budgeting system and designed a program of technical assistance to increase transparency in the process and promote accountability, making gross corruption more difficult.
The USG is working with the GON National Assembly and six state assemblies to increase transparency and promote ethical conduct through strengthened inter-governmental checks and balances. A main focus of USAID's legislative assistance is improving legislative oversight of budget and policy implementation. USAID has also worked with local NGOs to increase their involvement in the legislative process, including providing comments on the draft ethics code.
To increase transparency and promote integrity in the judicial sector, USAID is training judges in three pilot court districts on caseload management and training budget managers to manage court funds effectively. USAID has also established a working group on judicial corruption, consisting of NGOs and others involved in the criminal justice system, to develop a plan for addressing corruption within the judiciary.
The USG also works with civil society in Nigeria on the issue of corruption. For example, the USAID women's health networks are working with an international NGO to develop a transparency and accountability manual that will be used to train local communities in the roles they can play in fighting corruption. USAID supports the Zero-Corruption Coalition, a consortium of Nigerian NGOs that has developed several pieces of legislation aimed at promoting good governance. A new, two-year, $4.5 million civil society-strengthening program will begin in mid-2002.
In the area of elections, USAID is implementing an extensive program aimed at ensuring the success and openness of the upcoming local, state and national elections (2002-2003). USAID continues to provide training and technical assistance to the Independent National Electoral Commission to improve its capacity to plan for and administer elections, and will train the ad hoc personnel hired to staff polling stations. USAID is also working with political parties to improve understanding and execution of party and candidate registration procedures, to strengthen commitment to peaceful campaigning, and to train poll agents who are key monitors on election day. Finally, USAID will also support extensive civil society involvement in voter education and election monitoring, as well as a USG delegation of election monitors.
The GON has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention and the Second Global Forum. The GOK is a member of the Organization of African Unity (OAU) and the New Economic Partnership for Africa's Development (NEPAD).
Following the Asian Financial Crisis, The U.S. Agency for International Development (USAID) has worked with the Government of the Philippines (GOP) to increase its efforts to build a portfolio of anticorruption assistance. On the premise that corruption can be reduced by helping the GOP use the private sector in a competitive and open environment, USAID has several efforts underway to make contracting more transparent, open the regulatory system, and increase the number of firms supplying services.
USAID's major tool in achieving these results is its Accelerating Growth, Investment, and Liberalization with Equity (AGILE) activity. This initiative includes providing technical assistance and training to the GOP Bureau of Customs for the implementation of the WTO Valuation Agreement and the post-entry audit mechanism, which is expected to contribute to a post-entry audit capacity that reduces revenue leakage, is transparent, and is resistant to discretion and corruption. Through AGILE, USAID supported technical assistance and advocacy for reforming GOP policies and regulations that create monopolistic privileges in several economic sectors, including transport, power, and telecommunications. USAID worked with the GOP's Securities and Exchange Commission and the Philippine Stock Exchange (PSE) to improve the regulation of capital markets, protect investors, and increase investor confidence and willingness to invest in Philippine capital markets. USAID has provided advocacy training to enable citizens and the private sector to work with the GOP to prompt needed reforms in the collective investments sector and secondary market for non-equity securities. Lastly, USAID has provided technical assistance to harmonize insolvency laws and to help implement regulations that institutionalize support to commercial courts.
A major component of USAID's strategy is to strengthen the way the GOP administers the executive and judicial branches. This includes assistance to develop clearer and simpler rules, and making public administration more transparent. This USAID initiative includes technical assistance for a government-wide effort to comprehensively reform the rules and procedures governing GOP procurement, making the process more efficient and transparent. Specifically, USAID provided technical assistance to the GOP Bureau of Internal Revenue to develop procedures to streamline the taxation process, increase GOP revenues, and reduce opportunities for corruption. USAID also assisted in the development of regulations to reduce bank secrecy and limit opportunities for money laundering. Working with the GOP Supreme Court, USAID helped to guide lower courts on judicial review of economic policies, the doctrine of primary administrative jurisdiction, and the use of expert testimony in technical cases. This program aimed to strengthen the implementation of the local justice system and improve access to justice services for the disadvantaged, particularly women and children.
Another component of USAID's strategy in the Philippines is to mobilize the public through local government, civil society and public information programs. This USAID initiative provides assistance to local government financial management units so that they are more accountable and responsive to citizens. They have worked to facilitate adequate civil society consultation, advocacy, and oversight of legislative and policy reforms to improve the prospects for adoption and effective implementation of anticorruption reforms. They have assisted in the building up of local government capabilities and communities to better manage coastal resources, forests and solid waste, with a special emphasis on Western and Southern Mindanao. USAID, to help the GOP provide and manage better public health services, has provided assistance to the implementation of the GOP's Health Sector Reform Agenda.
The GOP has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention and the Second Global Forum. The GOP is a member of the Asian Development Bank - Organization for Economic Cooperation and Development (ADB-OECD) Anticorruption Initiative for Asia-Pacific.
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) provides technical assistance to the Government of Russia (GOR) law enforcement officials in the area of investigating and prosecuting crimes that involve public and private corruption. INL also provides funding for initiatives managed by the Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), a component of the Criminal Division of the U.S. Department of Justice (DOJ), to assistance the GOR with a Resident Legal Advisor (RLA) to enhance the skills of their prosecutors to handle complex criminal cases and to prepare the GOR for a U.S.-Russia Mutual Lateral Assistance Treaty. The GOR law enforcement personnel are also exposed to anticorruption methods and principles through the core law enforcement course at the International Law Enforcement Academy (ILEA) in Budapest.
INL also provides funding for an American Bar Association - Central and Eastern European Law Initiative (ABA-CEELI) criminal law reform program to assist the GOR through a regional anticorruption advisor and an in-country criminal law liaison. Among the assistance provided was partnering with Transparency International (TI) and the British Council in the program "Transparency for Regional/Municipal Governments" that works with local government representatives and NGOs to provide public access to information, codes of conduct and conflicts of interest and GOR procurement procedures. The U.S. Agency for International Development (USAID) also supports ABA-CEELI and their Rule of Law Program that works with the Samara and Tomsk oblast law enforcement and business communities to develop methods to report on corruption and to enhance prosecutorial techniques.
USAID continues its support to grassroots organizations fighting corruption. Through the Eurasia Foundation, USAID supports semi-annual grants to organizations focused on crime, community policing and corruption issues. One example is the Obninsk municipal governance program that brings together local leaders, NGOs and the media in a comprehensive program using the Internet to detail activities and budgets of local governments. The Obninsk transparency program has become a model for other regions. Over the past year, USAID has launched two pilot public-private partnership programs in Tomsk and Samara. Initial indicators from both regions are positive with more than 100 participants from GOR, NGOs and the business sector active in preparing their respective regional action plans to fight corruption. Moreover, since corruption is a crosscutting issue in Russia, USAID has incorporated anticorruption initiatives into several of their programs. For example, in its work with the GOR Judiciary, USAID has stressed the subject of judicial ethics for several years, working closely with the judicial branch body that enforces judicial ethics standards.
The USAID three-year strategy will emphasize public awareness while strengthening transparency and accountability of key GOR institutions and monitoring the progress of reform efforts. USAID also works with environmental NGOs to advocate improved and more transparent environmental practices.
The U.S. Office of Government Ethics (OGE) participated in a 2001 conference program, held in the Samara Oblast of Russia, entitled "Partnership Against Corruption." The program brought together the private business sector, the NGO community, and representatives of the Samara Oblast Administration to address areas of common concern in the fight against corruption and to build a coalition to address corruption-related issues in the future. OGE presented an overview of its functions and programs to the conference attendees as a whole and participated in discussions involving sector groups. OGE also met with Oblast Administration officials to discuss OGE's role in the executive branch, codes of conduct, criminal conflict of interest statutes, law enforcement's role in an ethics system, and financial disclosure systems.
The U.S. Department of Commerce (DOC), using legal advisors and workshops, has advised the GOR on World Trade Organization (WTO) accession matters and related efforts to promote transparency in trade. DOC funded a WTO website that contains information and a calendar of events in the Russian language, including information and releases from the GOR Ministry of Economic Development and Trade. DOC has also worked with the Russian Supreme Arbitration Court to promote transparent dispute resolution, creating a handbook on commercial dispute resolution and planning a manual for Russian judges on enforcement of arbitration awards.
In cooperation with the International Finance Corporation and the Russian-American Business Dialogue, the Russian Federal Commission for the Securities Market, Ministry of Economic Development and Trade and the Governments of the Netherlands and Switzerland, DOC is helping prepare, publish, and distribute a Corporate Governance Manual for Enterprises in Russia (Manual). The Manual will serve as a resource guide for Russian and foreign directors, managers, and investors. It will function as a training tool on corporate governance and shareholders rights for organizations involved with training Russian directors and managers as well as educational institutions.
DOC is working with the Russian Chamber of Commerce and Industry to implement its business ethics program in Russia. In 2001, DOC conducted regional workshops in Moscow and the Far East. They are now developing tools and materials, including a Business Ethics Manual, to educate and disseminate business ethics principles in an effort to support its Business Ethics Trainees in Moscow, Saint Petersburg, Samara and Novgorod. DOC also participated in the Community Connections Program, conducting a series of one-day business ethics seminars for visiting entrepreneurs and professionals from Russia.
The GOR has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention and the Second Global Forum. The GOR is a signatory to the CoE's (Council of Europe) Criminal Law Convention on Corruption.
Anticorruption efforts are central to USG assistance efforts in Ukraine and can be divided into two broad categories: direct and structural. Direct anticorruption efforts consist of a mix of programs targeting civil society and working in partnership with the Government of Ukraine (GOU). Structural anticorruption efforts are incorporated into nearly all USG assistance targeted toward civil society, democracy building and economic reform.
By promoting transparency and accountability, democratic and economic reforms reduce or eliminate corruption opportunities. By moving from discretionary licensing of economic activity toward automatic permitting based upon the fulfillment of clearly defined criteria, for example, avenues for petty administrative corruption by licensing officials have been reduced. Advances made in tax administration, the budget process, and regulatory reform have begun to reduce levels of corruption. Similarly, one of the results of the passage of a new and much clearer election law has been a reduction in election-related corruption.
The U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) funds an American Bar Association - Central and Eastern European Law Initiative (ABA-CEELI) criminal law reform program to provide anticorruption assistance to GOU. The program's in-country liaisons and regional anticorruption advisor have coordinated five seminars on anticorruption prosecutorial techniques, in partnership with the Organization for Security and Cooperation in Europe (OSCE). The ABA-CEELI team provides support to a GOU working group charged with drafting a new anticorruption, conflict of interest and GOU procurement laws. ABA-CEELI also assisted the GOU in their creation of a witness protection program, which is modeled after the Lithuanian Witness Protection Program and Anticorruption Agency. The program included a sending the liaison and GOU officials to Lithuania for consultations and organized a "Witness Protection for Participants of Criminal Justice Process in Ukraine and Human Trafficking Cases" seminar. ABA-CEELI has worked hard to develop a dialogue between GOU law enforcement agencies and NGOs working on trafficking and corruption issues such as the International Organization for Migration (IOM), the National University for Internal Affairs, Winrock International and La Strada Ukraine.
The U.S. Agency for International Development (USAID) strives to integrate integrity actions into all programming and has a specific civil society anticorruption project. The main activities of the three-year "Partnerships for Integrity" program supported by USAID will be to develop and implement anticorruption programs on both local and national levels. At the local level, the program will support the establishment of local NGO coalitions, which are focused on citizen educational activities and the increase of local authorities' transparency and accountability. Currently the Partnership is working in seven sites throughout Ukraine: Lviv, Drohobych-Boryslav-Truskavets-Stebnyk, Sumy, Kharkiv, Donetsk, Mykolayiv, and Kherson. Among the supported activities are citizens' advocacy offices and hotlines, public hearings, public education campaigns, more transparent and efficient governing mechanisms, and an ongoing dialogue between the public and private sectors.
At the national level, the program helps to implement anticorruption educational campaigns, establish a national anticorruption watchdog council, conduct research and polling on anticorruption issues in various sectors, and coordinate anticorruption campaigns with other Ukrainian and international organizations, donors and partners.
The USG is also providing small grants to organizations defending whistle-blowers and supporting independent investigative media. Technical assistance is being provided to a new national coalition of NGOs against corruption and to the GOU Parliament's efforts to improve citizen access to the legislative process.
The U.S. Department of Commerce's (DOC) Resident Trade Advisor is assisting the GOU in its drive to accede to the World Trade Organization (WTO) by working directly with the Ministry of Economy's governmental Commission on Ukraine's Accession to the WTO. DOC has translated and commented on various pieces of draft legislation in the trade area, including provisions to increase transparency in the trade process. It has also sponsored U.S.-based consultations and in-country seminars for GOU officials. DOC is also offering assistance to local businesses and NGOs with development of voluntary codes of business conduct, and conducting a "train-the-trainers" program to help promote good business practices throughout Ukraine.
The GOU has been active in international anticorruption fora such as the UN negotiations for a global anticorruption convention and the Second Global Forum. The GOU is a signatory to the CoE's (Council of Europe) Criminal and Civil Law Conventions on Corruption.
Corruption has become a critical topic for international discussion and action. The USG and many other players who provide anticorruption technical assistance worldwide -- including International Financial Institutions, NGOs, intergovernmental organizations, and others -- have derived lessons from the process of implementing programs and case studies of anticorruption initiatives. These experiences show that a successful battle against corruption requires sustained and simultaneous attention on a number of fronts, including engaging law enforcement agencies, educating and engaging the public and civil society, increasing governmental transparency and internal oversight and promoting good corporate governance. The tendency to incorporate prevention measures into regional anticorruption conventions underscores the growing international willingness to adopt a holistic approach to combating corruption.
Longstanding USG diplomatic efforts to counter corruption worldwide are beginning to be accepted and duplicated as a result. USG and donor assistance programs become more critical and effective as individual governments embrace the idea of international cooperation in the fight against corruption. Yet corruption remains a daunting worldwide problem that affects vital American interests. It deprives the American private sector of international business opportunities, decreases the effectiveness of USG and international donor aid and assistance, threatens the stability of fragile and emerging democracies, and can help facilitate terrorism. Fighting corruption is also a shared responsibility between developed and developing countries, as well as between the public and private sectors. The USG is committed to ensure that the "supply side" of corruption is also effectively addressed.
The USG will continue to pursue a mix of diplomatic and programmatic efforts that help to do the following:
- promote higher standards around the world relating to good governance (including corporate governance) and corruption,
- encourage mutual or self-evaluation of governments with regard to corruption within their borders, and
- enhance cooperation and technical assistance to promote local actions in the fight against corruption.
USG agencies -- including the Agency for International Development, the Department of State, the Department of Justice, the Department of Commerce, the Department of Treasury, and the Office of Government Ethics -- will work closely with Congress, cooperating governments and the NGO community to ensure a strategic and effective correlation between these USG diplomatic and programmatic activities. Good governance and principled responsibility can create conditions that lift people out of poverty, raise education and health levels, improve working conditions, expand the realms of personal freedoms, nurture sound economic and sustainable development strategies, and create more transparent and efficient government institutions. With the leadership of the USG and other dedicated parties, the international fight against corruption will continue to move forward.
V. List of Acronyms and Abbreviations
|ABA-CEELI||American Bar Association - Central and Eastern European Law Initiative|
|ACCC||Anti-Corruption Coordinating Council|
|"Account"||President George W. Bush's Millennium Challenge Account|
|ADB||Asian Development Bank|
|AGILE||Accelerating Growth, Investment, and Liberalization with Equity activity|
|CGD||Centre for Governance and Development in Kenya|
|CoE||Council of Europe's|
|DAS||Data Acquisition System|
|DOC||U.S. Department of Commerce|
|DOJ||U.S. Department of Justice|
|DOT||U.S. Department of Treasury|
|FCPA||U.S. Foreign Corrupt Practices Act|
|FfD||Finance for Development|
|FRY||Government of the Federal Republic of Yugoslavia|
|GCA||Global Coalition for Africa|
|GOA||Government of Armenia|
|GOG||Government of Georgia|
|GOG||Government of Guatemala|
|GOI||Government of Indonesia|
|GOK||Government of Kazakhstan|
|GOK||Government of Kenya|
|GON||Government of Nigeria|
|GOP||Government of the Philippines|
|GOR||Government of Russia|
|GOU||Government of Ukraine|
|GRECO||Group of States Against Corruption|
|IACC||International Anticorruption Conference|
|IAGGA||International Anticorruption and Good Governance Act|
|ICT||Information and Communications Technology Master Strategy Plan|
|ILEA||International Law Enforcement Academy|
|IMF||International Monetary Fund|
|INL||U.S. Department of State Bureau of International Narcotics and Law Enforcement Affairs|
|IOM||International Organization for Migration|
|KYLA||Kazak Young Lawyers Association|
|NDI||National Democratic Institute|
|NEPAD||New Economic Partnership for Africa's Development|
|NSIC||National Strategy Information Center|
|OAS||Organization of American States|
|OAU||Organization of African Unity|
|OECD||Organization for Economic Cooperation and Development|
|OGE||U.S. Office of Government Ethics|
|OIG||Office of Inspector General for USAID|
|OPDAT||Office of Overseas Prosecutorial Development, Assistance and Training|
|OSCE||Organization for Security and Cooperation in Europe|
|PAO||Public Affairs Office from the U.S. Department of State Embassy|
|PSE||Philippine Stock Exchange|
|RLA||Resident Legal Advisor from the U.S. Department of Justice|
|SADC||Southern African Development Community|
|SAI||Supreme Audit Institution for Indonesia|
|SPAI||Stability Pact Anticorruption Initiative|
|WTO||World Trade Organization|
|USAID||U.S. Agency for International Development|