Business

25 January, 01:03 PM

Ukraine slides five spots down in global corruption ranking

Ukraine slipped five positions down in the global Corruption Perception Index for 2021, published by Transparency International on Jan. 25, settling at 122nd out of 180 countries.

The drop has led to criticism that Ukraine’s 2021 anti-corruption efforts were ineffectual.

According to the report, Kyiv’s total CPI score for last year clocked in at 32 points, one point lower than in 2020, when the country was 117th in the ranking.

The CPI compares countries based on a set of common metrics. A country’s score, as opposed to its ranking, is key. A minimal score of 0 points corresponds to a country where corruption virtually replaces the state, while a score of 100 points suggests that corruption is essentially non-existent. CPI focuses on the public sector of each country’s economy exclusively.

The index integrates the input of local business, investors, market researchers, etc., based on a number of studies (around 8-11, varies from country to country).

Importantly, CPI measures the perception of corruption – not how actually prevalent it is. Better performance in the index would only indicate that a country is simply perceived as less corrupt than those who scored lower, even if that perception is not wholly accurate.

The European Commission has vouched for CPI’s methodology as being statistically sound and robust.

Our neighbors in corruption and geography

Ukraine scored about as high as Eswatini (formerly Swaziland) in 2021, and trailing Egypt, Nepal, the Philippines, Zambia and Algiers by just one point. Its score of 32 is one of the lowest in Eastern Europe.

Here are the 2021 CPI scores of Ukraine’s neighbors, compared to 2020:

·       Poland – 56 points, 42nd place (56 points, 45th in 2020).

·       Slovakia – 52 points, 56th place (48 points, 60th in 2020).

·       Romania – 45 points, 66th place (44 points, 69th in 2020).

·       Hungary – 43 points, 73rd place (44 points, 69th in 2020).

·       Belarus – 41 points, 82nd place (47 points, 63rd in 2020).

·       Moldova – 36 points, 105th place (34 points, 115th in 2020).

Russia is the only neighboring country that scored even lower than Ukraine, sitting at 136th place with 29 points.

Denmark and New Zealand – the usual CPI leaders – are joined by Finland this time around: all three countries a sharing the number one spot with 88 points each.

The very bottom of the index is occupied by politically unstable countries, where governments control only parts of their territory: Somalia (13 points), Syria (13 points) and South Sudan (11 points).

Why did Ukraine lose score and ranking?

According to Transparency International Ukraine, the country lost points due to these factors:

·       On Oct. 27, 2020, Ukraine’s Constitutional Court rolled back the penalties for government officials who file false income declaration forms.

·       Changes to antitrust rules that reduced transparency around awarding government contracts and procurement.

·       Further interference with the High Anti-Corruption Court of Ukraine, particularly from the Constitutional Court.

·       Increased undue pressure on various anti-corruption agencies, in particular – chronic delays in appointing a new head of the Special Anti-corruption Prosecutor’s Office.

·       Glacial and lethargic implementation of judicial reforms, even after clearing related legislative hurdles.

·       Delays to parliamentary ratification of the Anti-corruption Strategy.

 Global trends and outliers

“CPI-2021 failed to demonstrate major shifts in global anti-corruption efforts,” Transparency International said.

“The CPI global average remains unchanged at 43 for the tenth year in a row, and two-thirds of countries score below 50, with 27 countries sitting at historically low scores.”

The report also indicated a link between corruption levels and human rights.

“Since 2012, 90% of countries have stagnated or declined in their civil liberties score; corruption undermines the ability of governments to guarantee the human rights of citizens and erodes democracy,” the report said.

“(In turn) corruption spreads faster and further in countries that lack sufficient protections of human rights and civil liberties – in contrast with mature democracies.”

Considering this relationship, NV asked TI about the surprisingly high place Belarus occupies in the ranking, right beside even EU members, such as Hungary and Romania. According to Executive Director of TI Ukraine Andrii Borovyk, this seeming inconsistency arises because CPI only measures perception of public sector corruption, so factors like human rights or freedom of the press are not reflected in the index.

“Analysis suggests that individuals and business are less likely to encounter bribe solicitation (or other corrupt practices) in Belarus compared to Ukraine, but we have to keep in mind that criticizing the state in Belarus is out of the question,” said Borovyk.

“This means they (in Belarus) don’t have high-profile corruption scandals or journalists and activists who could expose those; this is one reason why the public sector in Belarus is seen as less corrupt than in democracies.”

Borovyk added that Belarus’s CPI score fell from 47 to 31 points in 2021.

According to TI Ukraine, when dealing with Hungary or Romania, CPI integrates data from 10 sources, or from nine such sources when it comes to Ukraine. In the case of Belarus, the number of sources is only eight, and this too could contribute to a less comprehensive final score.

 How can Ukraine improve

TI Ukraine boiled down five steps to reducing the perception of corruption for Ukraine:

1.     Follow through with appointing independent, reputable professionals as heads of various anti-corruption agencies: SAPO, National Anti-Corruption Bureau, Asset Recovery and Management Agency.

2.     Pass the Anti-corruption Strategy and get on with its implementation.

3.     Reform Ukraine’s constitutional judiciary, based on the guideline provided by the Venice Commission.

4.     Improve transparency around stewardship of state property and pivot to privatization.

5.     Avoid eroding the provisions of state procurement transparency laws.

When pressed by NV to single out the most important of these steps, Borovyk had this to say:

“There is no silver bullet that would make corruption vanish and dramatically propel Ukraine upwards in the CPI.”

“As you can see, our recommendations are systemic and interdisciplinary, and all important. This is exactly how we should approach tackling corruption perception in Ukraine – not by hoping to solve it all with one new law or mobile app,” Borovyk said,

He added that TI Ukraine did not focus on judicial reform, since it is already underway.

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