Report from the IV Workshop of the EMINS Policy Forum:

How to fight CORRUPTION?

In early December, in Belgrade, the European Movement in Serbia organized a workshop on the phenomenon of corruption and mechanisms to suppress it. In addition to experts in solving this problem the workshop was also attended by the representatives of local authorities and non-governmental organizations as well as domestic and foreign journalists. The workshop was intended to inform the participants on modern strategies used to fight corruption throughout the world, the current situation in Yugoslavia and the steps which could be undertaken during transition, especially at the level of local authorities.

In his introductory statement, Danijel Pantic (EM) particularly emphasized the fact that over the past few years, the global attitude towards the phenomenon of corruption had been changing and that numerous governments and expert teams had been investing serious efforts to scale it down. This issue has been laid wide open both in the developed and transition countries. It is also considered in the political and financial contexts as well as from the angle of developing the values of civil society wherein the NGOs have an important role. The OECD Convention abolished legal provisions, until recently applied in numerous Western countries which, via the tax exemptions, actually acknowledged corruption as a manner of closing the deals on foreign markets. While defining corruption as the abuse of public authority for one’s own interests, as well as the transaction forms it takes and the goods individuals thus appropriate at the expense of society, Danijel Pantic particularly underlined institutional characteristics and social positions which encouraged corruption: excessive authority of state bodies, minimum legal responsibility of the government, low development level of economic systems, the so-called sultan system – individual submission to authority instead of law, the low degree of legitimacy of government and domination of the ruling elite, which enabled it to trample on the law plainly and efficiently. Findings of the research carried out by the World Bank and other international institutions show that the low level of civil rights and freedoms generates a high degree of corruption, which implies that authoritarian regimes offer ideal social environment for its spreading. In an environment of this kind, the values of the law applying to all citizens equally and the basic mechanisms of a sound market competition are disrupted. In order to illustrate the huge damage this inflicts on the society, Pantic pointed out that a 2.38% decrease in corruption increases the social product by 4%. Listing specific measures to be undertaken in the struggle for corruption and the important international support in their implementation (privatization, regular elections, reform of the judiciary and legal regulations, independent media, developed civil society, parliamentary control, legal protection of journalists and non-governmental organizations dealing with this problem, political will and readiness for cooperation), Danijel Pantic particularly supported the education of the public and social marketing in order to make the citizens aware of the price of corruption and the necessity to themselves become engaged in the struggle against it.

The importance of this kind of a campaign was also emphasized by Jelica Minic (EM), who spoke of the dominant role of corruption in the Serbian and Yugoslav economies. She believed it was the case of distorted transition under conditions of a wartime economy and sanctions. The long-drawn-out blockade, the disintegration of the country and the ruin of the economic system resulted in the disrupted flows of goods, unemployment, inflation and the strenghtening of the repressive apparatus. The grey economy has become prevalent and is accompanied by increasing criminalization of the economy and society. The sanctions have rendered almost all external activities of the country illegal and exposed all businesses to arbitrary decisions and control of the state. In a situation like this, corruption is the only way to maintain a business of any kind which brings about the moral ruin of society and all its sectors. While pointing out that this kind of environment sustains the regime in power and impairs the institutions of the system, Jelica Minic warned that the scope for legal economy was increasingly constricted. The state has become the major player on the black market, since foreign exchange cannot be secured by exporting goods and cervices or through legal bank and market transactions. Profit is earned by acquiring or purchasing the rights to semi-legal and illegal transactions, on the basis of one’s position in the nomenclatura, directorial-ministerial posts or corruption. Thus, a narrow circle of people is becoming enormously rich, while, on the other hand, the number of those whose earnings are insufficient to meet the existential minimum keeps increasing. By encouraging the grey economy the state is forgoing an important portion of its revenue, and - in order to cover huge expenses for the army, the police, refugees, subsidies and social transfers - it resorts to two specific lines of tactics: imposition of excessive burden on the legal economy and uncontrolled money issue. Both these lines of action destroy what has remained of the vital parts of the legal economy which is why the establishment of a long-term rational strategy and a sound economic program is practically impossible in utterly irregular conditions of an autarchic and isolated system.

Nebojša Medojevic (Group 17) believes that the problem of corruption was rather marked in Montenegro. Although the Montenegrin government verbally declares in favour of reforms, what is actually happening is a perverted transition which leads from one totalitarian society based on ideology into another kind of totalitarianism based on uncontrolled political and economic power of the new oligarchy. Medojevic underlined that in Montenegro it was the rules of the mighty rather than the rules of law that prevailed and that, instead of the substantial systemic changes, only the redistribution of power, based on capital, was carried out. The announced reforms in the administration, aimed at increasing the efficiency and rationalizing its operations do not include a single mechanism which would limit the control and power of the current authorities or enable protection against corruption. Medojevic expressed his concern that international assistance would remain ineffective as long as Montenegro was ruled by the current political elite, since those who had already been infected by corruption could not be the proponents of reforms. That is why it is necessary to incorporate international standards into administration of public affairs so as to strictly regulate the possible conflict of interest and the abuse of power by state officials. It is very important for the EU, via the stability pact, to find the mechanisms to set out into the future in cooperation with new people. Of key importance in the struggle against corruption is institution building and the rearing up of new uncompromised people and the public opinion to see sound interest in cooperation with the international community.

This position was supported by Sara Morante (Transparency International), who stated the example of the adverse experience of the international community in Bosnia. Enormous funds had been invested into the Bosnian project, but the progress achieved was minimum, since a large portion of the money disappeared in corruption. This indicates that emphasis should be placed on the development of civil society institutions and increasing the people’s awareness of the importance of joint engagement in solving this problem. This way alone, Sara Morante said, could pressure be applied on the authorities to cooperate in the struggle against corruption. The fact that this is possible is confirmed by the example of the TI, which has developed a network of 77 national organizations in the world. As far as the region of South-Eastern Europe is concerned, its activities are the most intensive in Bulgaria, Romania and Greece. TI focuses on cooperation with local civic groups willing to become engaged in the struggle against corruption, since this is a problem which goes beyond the current political context or party affiliation. Sara Morante explained that the TI was no political organization and that it conducted no investigations or initiated criminal prosecution in individual cases. Its work is based on inciting and offering support to non-governmental organizations, as well as local political authorities, providing that they expressed political will and readiness for the transparency of their work. In that case the TI offers expert assistance for practical pursuit of the struggle against corruption, such as was e.g. the case in Piraeus in Greece. Sara Morante noted that it was extremely important to work with the local authorities, since people at that level knew more about the current problems, had stronger feedback with the citizens and better communication, which is why it was also easier to monitor the implementation of agreed principles in practice. The TI experience indicates the need for non-governmental organizations it cooperates with to be highly professional, which is accomplished by providing expert assistance.

Tangible effects of cooperation with the TI in Bulgaria were presented by Emil Tcenkov (Coalition 2000). Owing to the active dissemination of information and launching of campaigns the awareness of the corruption problem among the population has been increased. This is also confirmed by sociological surveys carried out on three-month basis. Their findings indicate that Bulgarian citizens experience corruption as the third largest problem in the country, next to unemployment and poverty. A large part of activities is based on developing the local initiative – expanding and deepening of transparency in the work of the local authorities and increasing the cooperation with non-governmental organizations, with a view to developing the values of civil society and democratic processes. One of the extremely important steps is also the proposal for the institution of an ombudsman which has been submitted to the parliament..

Indicating the radical changes in the approach to corruption in transition countries Predrag Jovanovic (Economic Institute, Belgrade) noted that corruption was still considered “normal” behaviour in Serbia. Enormous impoverishment of the population encourages corruption and, under the circumstances, the one who cannot pay is deprived of a large number of services. In addition to economic damage, corruption also produces disastrous political consequences. By way of illustration Jovanovic referred to the abortive attempts to resolve the problem by the opposition once it came in power on the local level. Not only have the representatives of the new authorities failed to reduce corruption, but it was in some instances even increased, thus causing the loss of confidence of the citizens, political apathy and decreased motivation for engagement in change. In order to win the trust of the citizens the local authorities must change the pattern of their behaviour as well as their approach to the problem of corruption. Jovanovic also stressed that public control was easier at the local level, especially in small places where contacts with citizens were more direct. In order to attract foreign investors, the image of the Balkan region as the “black hole” wherein money disappears must be changed. Money flows must be transparent and until that is achieved, Serbia will be of interest only to speculative capital. Jovanovic pointed out that in the struggle against corruption at the local level two main lines of action had to be pursued. The first one has to do with the improvement of the quality of services, rational organization of administration and more efficient redistribution and use of available funds. In parallel, activities should be undertaken to improve the transparency and publicity of the work of municipal bodies, as well as to provide timely information to citizens about the problems which may be realistically tackled under the prevailing circumstances. Continuing readiness of the authorities to cooperate with the citizens based on the transparency of public affairs and revenues, opens the possibility for the inclusion of experts into the resolution of priority problems and the provision of higher quality help to the local administration. In order to substantiate his position Jovanovic spoke of the encouraging experience of some highly corrupted countries (Italy, Colombia, Argentina, and Mexico) where similar actions had been undertaken in selected municipalities. The actions had extensive media coverage and resulted in reduced costs (in Milan the costs of public purchases were reduced by 50%) eliciting highly positive reactions of citizens.

Following a brief discussion, including also the participation of local authorities’ representatives who presented their views of the problem as well as specific hands-on examples concerning the possible achievements in the struggle against corruption in the current circumstances, the participants of the Workshop agreed on the following conclusions:

1. In view of the extremely difficult political and economic situation in Serbia, the launching of a wide anti-corruption campaign at this point of time is not realistic;
2. A part of local authorities in Serbia expresses their strong political wish to fight this problem;
3. Professional non-governmental organizations, which may assist the local authorities in their struggle against corruption do exist both in the country and abroad;
4. A domestic coalition could be formed following a model which proved successful in Bulgaria. This coalition would be based on coooperation of non-governmental organizations, part of the local authorities and independent media. It could provide the “critical mass” necessary to tackle the corruption problem efficiently;
5. Public purchases in certain municipalities may already be made more transparent, offering an encouraging example for others;
6. It would be necessary to prepare the experts and professional institutions for the coming transition in Serbia in order to secure that it is carried out in the best possible manner. Since one of the most important issues in this context is corruption the TI is invited to assist in the professionalization of personnel to solve the problem.

Zorica Žarkovic