Corruption is not a phenomenon which is confined to the poor counties alone; it has engulfed all the countries of the world. No country can claim to be totally clean - it is only a matter of degree. Rich and big economies breed big corruption and have painstakingly developed a system that helps the rich getting richer without any qualms. This has attracted comments from social activists and journalists alike as 'indecent' and 'immoral'.
Take for example, the case of the world's richest country - the United States. It has been widely discussed that massive inequality is incompatible with robust democracy. But what do we actually find in the world's largest economy and loudest 'champion' of democracy, the US? The top one per cent in the US is taking home 20 per cent of the country's total income and owns at least 38 per cent of the national wealth. The richest 400 people have more wealth than the bottom 150 million people. This is not any fertile brain's imagination but exists in cold statistics available publicly.
The massive income inequality in the US was created through a system over the years and that system is now being sustained. But this systemic immorality does not exclude the classical corruption of tax dodging, managing massive business deals (especially the defence contacts) involving large corporations and government agencies. Such types of corruption also exist in other rich countries too. But what amazes one is that the leaders of those same governments and agencies tend to be overzealous in pointing out that wide corruptibility in the developing countries are eating out the vitals of those countries. The rich countries have an advantage in that that they don't seek assistance from anyone and that there is truth in what they say.
The poorer countries have less developed systems (compared to the rich nations) and checks and balances don't work against people with 'connections' which allow flourishing of corruption by mutual consent. Nobody denies that corruption exists in our country and even Finance Minister AMA Muhith is quick in publicly pointing out those weaknesses from time to time. He is also aware that there exists a nexus between the business, and a section of law enforcers and concerned officials who are supposed to ensure that rules are strictly enforced. Their bonhomie cost the nation enormously.
Recently at a meeting of the development partners (Local Consultative Group) arranged by the Economic Relations Division (ERD), Finance Minister Muhith bluntly said that corruption is 'eating up to two to three per cent of gross domestic product (GDP) while another one per cent of GDP is lost because of political unrest. He pointed out that the country's GDP in FY2015 was estimated at Taka15.3 trillion. This gives an idea about the magnitude of the loss.
This is not all. According to a study conducted by the Washington-based Global Financial Integrity (GFI), 38.5 per cent of the combined official development assistance and foreign investment the country received between 2008 and 2012 were illegally taken out of the country. This accounts for 1.1 per cent of the GDP.
In an earlier report, the GFI suggested that on average, $1.31 billion was smuggled out of Bangladesh each year between 2003 and 2012. The indicators include GDP, total trade, ODA (official development assistance), FDI (foreign direct investmen) and public expenditures on education and health services and total tax revenues. The GFI report commented: "When illicit flows are high, a country's development score tends to be low."
Interestingly, the report pointed out that about 61 percent of the illegal outflows from Bangladesh takes place through trade misinvoicing.
Meanwhile, the Dhaka-based American Chamber of Commerce, Bangladesh (AmCham) in its monthly luncheon meeting early this month revealed that the US Department of State pointed out in a report that corruption still remains a "serious impediment to investment and economic growth in Bangladesh." It said: "Corruption is common in public procurement, tax and customs collections, and regulatory authorities. Corruption, including bribery, raises the costs of risks of doing business." The report claimed that by some estimates, off-record payments by firms may result in an annual reduction of two to three per cent of GDP.
This means, everything taken together, the annual losses due to corruption may total well over six per cent of the country's GDP which is simply mind-boggling.
