The Poverty of Corrupt Nations

Tackling corruption

The factors influencing poverty in the developing world are varied and complex. Geographic location, conflicts, climate, the "resource curse," and weak governance are some of the main drivers. Improving governance and tackling corruption could be key to improving living standards in poor countries over the next decade. Similarly, enlarging the set of tools available to finance entrepreneurial enterprise has huge potential—along the lines advanced by thinkers such as Hernando de Soto and his proposals for unlocking "trapped capital," and by risk-takers such as Muhammad Yunus and the Grameen Bank in delivering more customer-friendly microcredit.

Public and private investment in developing countries, however, will be inhibited by the size and scope of "big ticket" corruption. By big ticket corruption, I mean the theft perpetrated by some senior elected and unelected officials in developing economies, as opposed to the petty bribery that occurs in some of the more junior levels of these bureaucracies to "facilitate" and expedite various administrative processes.

The African Union itself estimates that approximately $148 billion is lost each year in Africa to corruption. Transparency International has estimated that the 10 most corrupt contemporary leaders have embezzled in the range of $32 billion and $58 billion from the citizens. How many hospitals, schools, and roads would that have bought?

Roy Cullen, Member of Parliament, House of Commons, Canada, and author of the book, The Poverty of Corrupt Nations,

From IMF's F&D September 2008

Related;
What makes effective anti-corruption systems?