Corruption

Aid is dead:  it is worse than merely useless, since it abets and perpetuates mis-governance and dependency by Africa.  No, to the contrary, massive additional infusions of aid are crucial for all of Africa.  This massive transfer of aid to governments in Africa is particularly urgent right now, in the midst of the financial crisis, which is bound to inflict permanent damage everywhere in the continent.

These blanket statements are nonsense, on both sides.  While they may contain a 'straw man' element, unfortunately in slight variants one often sees such pronouncements in current writings and public debates.  In spite of the practical irrelevance of holding on to such extreme positions, such artificial debates go on and on, pitting the extremes against each other.  The media loves it.  Each side of the argument tends to fit selective 'facts' (and hyperbola) to their extreme cause.  Even reasonable analysts tend to write about one single determinant for the ills of Africa, or just opt to focus on one extreme side of the argument or the other.

A few days ago, Dani Rodrik opened an interesting discussion with his post "How the financial crisis has killed the governance reform agenda."  Basically what he says is that "we need to downplay the role of improved governance as a causal mechanism for economic growth." 

His main argument is that the financial crisis in the US did not only undercovered issues of capture and corruption in this country -as Simon Johnson and Dani Kaufmann have argued- but also showed that it is possible to be corrupt and rich at the same time.  Based on this evidence and on his previous belief that the causal relation between governance and growth was never proofed to be strog, he concluded that even though governance reform is a good thing to do, it should not be confused for a growth strategy.

The global economic crisis revealed large scale fraud in the financial sector and dropped public confidence and trust. This presents a daunting array of challenges to companies and government alike. It is practically impossible for a single stakeholder on their own to effectively address the problems that contributed to this crisis: corruption, greed, lack of transparency and leadership. Hence there is a case for collective action that enables companies to collaborate with competitors and/or stakeholders from the public and civil society sector to create and maintain fair market conditions.

Recognizing this, the World Bank Institute is organizing an Executive Development Program precisely on such joint approaches titled Fighting Corruption through Collective Action in Today’s Competitive Marketplaces. 

World Water Day was celebrated on March 22 and to bid farewell to a month full of water related activities, the World Bank Institute and Transparency International launched the book “Improving Transparency, Integrity, and Accountability in Water Supply and Sanitation” in an event hosted by the Center for Strategic and International Studies on April 1, 2009.

More than 1 billion people around the world live without access to safe, potable water, in part because of poor governance and corruption. To raise awareness on issues such as embezzlement of funds, bribes for access to illegal water connections, manipulation of meter counters, and collusion in public contracts, the World Bank Institute, together with Transparency International, developed this book to provide a useful tool for diagnosing, analyzing, and remedying systemic corruption in the water supply and sanitation sectors.

This books stems from the twin capacity building programs carried out by WBI and the World Bank Water and Sanitation Program (WSP) in Honduras and Nicaragua in September 2007, previously discussed at this blog.