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ECONOMY: World Bank Sees Progress Against Corruption
By Abid Aslam
WASHINGTON, Jun 24 (IPS) - Developing and former Soviet countries are making rapid progress in controlling corruption and promoting political stability and government accountability, the World Bank said in a new report Tuesday.
"Progress reflects reforms in those countries where political leaders, policymakers, civil society, and the private sector view good governance and corruption control as crucial for sustained and shared growth," said Daniel Kaufmann, governance director at the World Bank Institute, an internal think tank.
How much credit the bank can claim remains an open question following the release of a separate report in which an in-house watchdog said the lender's efforts to root out corruption in poor countries have "rarely succeeded".
Better governance helps in the fight against poverty and improves living standards, according to Tuesday's World Governance Indicators report.
"Research over the past decade shows that improved governance raises development, and not the other way around," it said, adding that when governance is improved by one point, infant mortality declines by two-thirds and incomes rise about three-fold in the long run.
Good governance also has been found to enhance the effectiveness of development assistance in general and of World Bank-funded projects in particular, the report added.
Many top reformers rose from very low baselines, the bank acknowledged. Afghanistan, where the state has yet to establish its writ over most of the country, stood out for improving "government effectiveness".
Even so, vast improvements were seen across all regions and levels of national income. From 1998-2007, bank researchers found marked progress on the "voice and accountability" of government in Ghana, Indonesia, Liberia, and Peru.
Rwanda, Algeria, and Angola made strides in ensuring political stability and stifling violence and terrorism.
The quality of regulation improved markedly in Georgia and the Democratic Republic of Congo. Tajikistan advanced the rule of law. Liberia and Serbia struck significant blows against corruption.
"Good governance can be found at all income levels, with some emerging economies matching the performance of rich countries on key dimensions of governance," the bank said.
More than a dozen emerging economies - among them, Slovenia, Chile, Botswana, Estonia, Uruguay, Czech Republic, Hungary, Latvia, Lithuania, Mauritius, and Costa Rica - scored higher on key dimensions of governance than did industrialised countries such as Greece and Italy, the bank found.
Despite the many gains, the bank added, the "overall quality of governance around the world has not improved much over the past decade." Among countries that have regressed, it highlighted Zimbabwe, Cote D'Ivoire, Belarus, Eritrea, and Venezuela.
The key to advancement, it said, was "commitment to reform" from local elites.
The bank has had little success in promoting such commitment, according to a report last month by its Independent Evaluation Group. The watchdog blamed this in part on the bank's ignorance of local politics and culture, and misgivings about the lender's insistence that borrowers cut civil service jobs and pay.
"Direct measures to reduce corruption, such as anti-corruption laws and commissions, rarely succeeded, as they often lack the necessary support from political elites and the judicial system," evaluators said.
The governance report released Tuesday marked the seventh time the bank has updated its data over the past decade. The latest edition covered 212 countries and territories and added to a database used by policymakers, academics, and pressure groups.
The bank, stung by recent internal criticism of its research efforts, cautioned against relying too heavily on its latest findings or reading too much into them.
"The WGI [World Governance Indicators] and other efforts to measure are useful in prompting public discussion of governance challenges and successes but at the same time, discussions of governance based on empirical measures need to be realistic about the limits of existing data," said Aart Kraay, lead economist in the bank's development research group.
"It is important that users take seriously the margins of error reported in the WGI, which reflect the inherent difficulties in measuring governance using any kind of data," Kraay added.
Earlier this month, the internal evaluation group released another report assailing the bank's flagship "Doing Business" indicators as ideologically biased and methodologically flawed. Bank managers defended their product but agreed to many changes urged by their internal critics.
(END/2008)
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