USINFO Webchat transcript, December 12 Acting Deputy Assistant Secretary of State for International Crime Elizabeth Verville, Deputy Assistant Secretary of State for Economic and Social Policy Gerald Anderson and Deputy Director of the State Department's Office of Monetary Affairs Andrew Haviland answered questions from Jordan and Washington in a December 12 USINFO Webchat on the U.N. Convention Against Corruption. Following is the transcript: U.S. DEPARTMENT OF STATE Combating Corruption: The U.S. Role in the UN Convention Against Corruption (UNCAC) Guest: Gerald Anderson, Elizabeth Verville and Andrew Haviland Moderator: Welcome to today's webchat! We will begin shortly. You are welcome to begin submitting questions now or you may wait until the live event begins at 1200 GMT. Your questions will not appear on the screen until answered by our guest speakers. We are seeing your questions, thank you. Answer [U.S. Officials Discuss UNCAC]: This is Gerald Anderson, Deputy Assistant Secretary of State for International Organizations Affairs. I'm pleased to join you today in a discussion of the United Nations Convention Against Corruption (UNCAC), which is a historic achievement of the international community and an important tool for improving the conditions for economic and social development worldwide. A [U.S. Officials Discuss UNCAC]: Greetings. My name is Andrew Haviland and I am part of a team at the U.S. State Department that works to address the economic aspects of corruption. Recent surveys show that people around the world believe that corruption adversely affects their lives. As individuals, people may feel powerless to fight back and force change. The challenge for all of us is to recognize the problem and work collectively to eliminate it. The cost of corruption and opportunity cost of inaction is too high. We must work together, both the public and private sectors, to set standards of conduct and ensure that we collectively live by them. The UN Convention Against Corruption is an important part of that collective effort. I look forward to your questions. A [U.S. Officials Discuss UNCAC]: This is Liz Verville and John Brandolino joining you from the Dead Sea Jordan. We are pleased to be with you from the first Conference of States Parties to the UN Convention against Corruption. The United States became a party to the Convention last month. We are representing the United States at this meeting to translate the Convention into practical implementation. Q [Marek]: Corruption on one culture or country may just be "business in usual" in another culture! -- if that's true, how can there be an international fight against corruption or a universal definition of what corruption is? And how does the U.S. businesses deal with corruption in other countries ... what if they MUST pay "special fees" to have a business? A [U.S. Officials Discuss UNCAC - Gerald Anderson, Deputy Assistant Secretary of State for International Organizations Affairs]: Marek, the task of developing standards and best practices to deal with universal problems that affect all nations is at the heart of the work of the United Nations. Cultural differences exist in all areas of human experience, and the member states of the United Nations must take these differences into account in making decisions on how all member states can work together to solve common problems. Respect for human rights, ensuring the rule of law, resolving armed conflicts, and overcoming poverty are all examples. Q [Guest]: How many countries have ratified the United Nations Convention Against Corruption? Mr. Babenasolo Nampoina, Assistant Director in charge of Education and Communication within BIANCO an independent office for the fight against corruption in Madagascar. A [U.S. Officials Discuss UNCAC - Liz Verville]: Excellent question Mr. Nampoina, 80 countries have become Parties to the Convention and 140 countries have signed. Many of them may be in their processes of ratification or accession. Further details are available at: http://www.unodc.org/unodc/crime_signatures_corruption.html. Q [Guest]: U.S. companies complain that they have an unfair disadvantage internationally because they are legally prohibited from bribing foreign officials. Isn’t this Treaty just another example of the United States using the United Nations to make it easier for American companies to get more global business? A [U.S. Officials Discuss UNCAC - Andrew Haviland]: Corruption limits opportunities for everyone and reduces competition. In public procurement, open competition helps to ensure the best use of public money. I do not think we can assume that U.S. companies will get more contracts when competition is open. The UNCAC is just one of many efforts that we are undertaking with the international community to help ensure everyone is playing by the same set of rules and have the same opportunities. [U.S. Officials Discuss UNCAC - Liz Verville in Jordan]: Leveling the playing field for all companies that insist on acting legally and ethically in the course of international business -- whether it be American companies or companies from any other country -- is only one of many objectives of UNCAC. UNCAC’s provisions also focus on governmental actions that help prevent corruption domestically and allow for better international law enforcement cooperation relating to a wide variety of corruption crimes, including embezzlement and money laundering. The U.S. and many other governments viewed the development of UNCAC as an important way to raise generally the level and intensity of anticorruption activity around the global, which is why over 130 countries supported and participated in negotiations for UNCAC in 2002-2003. Q [Mr. Raoelson Harilanto]: What do you think are the most effective ways to combat corruption in the Public Administration? A [U.S. Officials Discuss UNCAC - Liz Verville]: The UN Convention provides a good framework for a comprehensive approach to preventing and combating corruption. We encourage you to take a look at its provisions requiring criminalization of corrupt conduct and also at its innovative chapter on preventive measures. Q [Guest]: In many countries government officials are paid so little, if at all, that “bribes” are the only way for these people to get adequate pay. It is part of the culture. Does this UN Treaty require governments to pay their official better wages? If not, won’t the Treaty take away this income and simply push more people into poverty? A [U.S. Officials Discuss UNCAC - Gerald Anderson, Deputy Assistant Secretary of State for International Organizations Affairs]: Payment of adequate remuneration for public officials is an important basic principle of good governance and an essential tool in preventing corruption and supporting the rule of law. Article Seven of the Convention recognizes this fact. In Article Seven, the parties to the convention agreed to endeavor to put systems in place to ensure that officials are adequately paid, taking into account the level of development of each state. [U.S. Officials Discuss UNCAC - Liz Verville and John Brandolino from Jordan]: UNCAC recognizes that lack of adequate pay for government officials can be one of many factors that can affect levels of corruption. As such, Article 7 of UNCAC calls upon parties to adopt, maintain and strengthen systems for recruiting, hiring, retaining, promoting and retirement of government officials ”that include adequate remuneration and equitable pay scales, taking into account the level of economic development of the State Party.” That being said, it is important to recognize that there are many honest government officials around the world who are not necessarily paid adequate salaries. In adequate pay is not the only factor -- and in some contexts may not be a factor at all -- in determining whether a government official decides to act corruptly. [U.S. Officials Discuss UNCAC - Andrew Haviland]: One of the goals of UNCAC and other efforts to reduce corruption is to remove a major obstacle to growth and to promote a more efficient use of scarce resources. Studies show that corruption actually hinders efforts to reduce poverty. There is a clear correlation between corruption and increased income inequality. Corruption, therefore, pushes more people into poverty, not efforts to stop corruption. Having an international organization set wages in member countries is not practical. Markets need to determine appropriate wage levels. Q [Guest]: Please tell me about provisions of UNCAC. What exactly is this intended to do ... and is there enforcement mechanisms? A [U.S. Officials Discuss UNCAC - Liz Verville in Jordan]: Thank you for your question. The UNCAC provisions commit parties to take action on a wide range of fronts, thus recognizing that the fight against corruption requires a comprehensive response. For example, UNCAC requires countries to criminalize core corrupt conduct, such as bribery, embezzlement, money laundering and other corrupt actions, and to have the proper mechanisms in place to allow international cooperation among law enforcement agencies in the areas of mutual legal assistance and extradition. UNCAC also commits parties to take a variety of actions to prevent corruption from happening in the first place, such as ensuring that public procurement and financial management systems are transparent, developing anticorruption strategies and bodies, instituting codes of conduct and other measures to promote integrity in public service, ensuring accounting standards that will prevent corruption in the private sector, and allowing public access to information and the involvement of civil society in the fight against corruption. UNCAC also contains an unprecedented chapter that provides a framework for international cooperation in asset recovery cases. With regard to enforcement mechanisms, UNCAC creates a “Conference of States Parties” that has been charged with reviewing implementation of the convention. I am here in Jordan now, leading the U.S. Delegation, attending the first session of that Conference. Approximately 125 countries are represented here, and we are deciding what mechanisms need to be developed to promote implementation, including mechanisms that will facilitate technical assistance. Q [Marianna]: Let's forget corrupted people for a moment. What about people (simple citizens who think of themselves as investors) who are willing to pay corrupted people in order to "have their work done", especially in countries like former Soviet Union. How can we "fight" that, because, that’s also a factor that undermines both global investment and democratization efforts too. Thank you. A [U.S. Officials Discuss UNCAC - Liz Verville in Jordan]: Under the Convention, no one should be paying bribes to public officials, whether corporate or private citizens. States Parties are required to make such payments a crime. Q [Guest]: I think one of the biggest problems related to corruption is the ease by which funds can be moved electronically. This easy movement makes it almost impossible to track. How does U.S. propose to deal with this? A [U.S. Officials Discuss UNCAC - Liz Verville in Jordan with John Brandolino]: This is a very important issue. The ease by which funds can be transferred around the world indeed provides opportunities for corrupt actors to launder the proceeds of their illicit activities. The U.S. and many other countries are very active in promoting the development of effective anti-money laundering regimes in financial center and non-financial center countries. The Paris-based Financial Action Task Force (FATF) sets international standards for addressing money laundering, and FATF and various FATF-style regional bodies actually evaluate countries on their respective implementation of FATF standards and assist those countries that need help in this regard. UNCAC also requires and encourages countries to take similar actions to build effective anti-money laundering regimes. Q [Harijan]: How does the treaty work? How many signatory nations are there? How does the convention define "corruption"? A [U.S. Officials Discuss UNCAC - Liz Verville with John Brandolino]: There are 80 states parties and 140 signatories. Each party is obligated to carry out the requirements in the treaty, for example, to have laws that make crimes of corrupt conduct. They are also obliged to take measures to prevent corruption in the first place. The treaty also establishes a framework for parties to provide mutual legal assistance and extradition to assist each other in investigating and prosecuting crimes of corruption. The Convention also contains an innovative chapter for the first time providing for a road map as it were to facilitate their return to rightful owners of stolen assets. The Conference of States Parties, which we are attending this week at the Dead Sea in Jordan, is the first meeting of the parties to determine how best they can collectively promote effective implementation to bring the provisions of the Convention off the pages of the treaty into practical action. Q [Guest]: Hi, the following questions are from Mr. Raoelson Harilanto: How to measure the correlation between poverty and corruption? A [U.S. Officials Discuss UNCAC - Andrew Haviland]: Raoelson, your question is a good one and a complete answer would quickly get beyond my technical capabilities. The World Bank Institute and others have done research that is publicly available and will provide details on the methodology used. In general terms, however, researchers use different techniques to gather data through surveys on incidents of corruption and poverty, both within and between countries. An econometric or mathematical analysis of the data establishes the correlation. Corruption can hurt all segments of society, but tends to be most harmful to the poor. Surveys show that poorer households pay a much higher share of their income than do higher income households. You can find more information on the World Bank's website. Q [Mr. Raoelson Harilanto]: How to measure the correlation between poverty and corruption? A [U.S. Officials Discuss UNCAC - Gerald Anderson, Deputy Assistant Secretary of State for International Organizations Affairs]: Mr. Harilanto, that is a very relevant question. There is no doubt that poverty is a factor that increases the risk of corruption. We have already discussed the importance of paying adequate compensation to public officials in order to fight corruption. Your question addresses the problem of poverty in society as a whole. A lot of work has been done to study this relationship, comparing countries worldwide. You can find some very good information at http://www.transparency.org/. These studies show that poverty is one of the factors that is correlated with corruption. However, at all levels of development and income, the quality of governance is crucial. The Convention that we are discussing is intended to apply at all levels of development, and is based on the consensus that implementation of principles of good governance can reduce corruption and improve the climate for economic growth and development, and contribution to the reduction of poverty in general. Q [Shamim Ahmed]: How U.S. government could help Bangladesh to combat corruption? A [U.S. Officials Discuss UNCAC - John Brandolino]: The U.S. provides technical assistance for Bangladesh, helping strengthen their anticorruption institutions. We are also supportive at the international level in integrating Bangladesh into the UN Convention process and other processes that build partnerships in the international fight against corruption. Q [Shamim Ahmed]: Do you think scale of corruption is higher in LDCs than developed nations? A [U.S. Officials Discuss UNCAC - Liz Verville]: No nation is immune from corruption. While Transparency International and other organizations seek to measure the scale of corruption in various countries, there are many forms of corruption, and it manifests itself at many different levels. The challenge of the UN Convention is to make a difference in countries' will and ability to work together to fight corruption at home and globally. Q [Harijan]: America seems to be pushing for tighter international regulations on transferring money and doing business with the goal of fighting international corruption. However, by virtue of additional rules and bureaucracy, increased international regulations also stifles growth and limits opportunities for companies in less developed countries that are trying to go global. What is the State Department doing to ensure that these ambitious countries and companies are able to compete internationally even though they have fewer resources to meet the demands new regulations place on them? A [U.S. Officials Discuss UNCAC - Andrew Haviland]: Harijan, you make an excellent point about the costs associated with regulation aimed at stopping the abuse of financial systems by corrupt individuals. The U.S. is continually working with its partners worldwide to identify the most efficient types of regulation that balance cost and benefits. In doing that, we must recognize that corruption has its own costs. The World Bank estimates that over $1 trillion is paid globally in bribes each year. This includes both industrialized and developing countries. Corruption places very high financial demands on countries and companies with limited resources. Those costs are hidden and make it very difficult for companies to plan and determine whether an investment is feasible. One study on foreign direct investment estimates that corruption is the equivalent of a 20 percent tax on investors. An investor then must earn that much more to make the investment worthwhile. Q [Guest]: What are the objectives of the International meeting in Jordan from 10 to 14 December 2006? Mr. Babenasolo Nampoina Assistant Director in charge of Education and Communication within BIANCO an independent office for the fight against corruption in Madagascar. A [U.S. Officials Discuss UNCAC - Liz Verville]: The meeting in Jordan is the first Conference of States parties to the Convention against Corruption. Under the Convention, this body's responsibilities are to "improve the capacity of and cooperation between States Parties to achieve the objectives set forth in (the) Convention and to promote and review its implementation." We are engaged in that process now of identifying the most fundamental issues of implementation and how best to promote and achieve them. Issues such as technical assistance to help countries that need it implement the Convention, recovery of stolen assets and review processes are examples of issues under discussion. Q [Guest]: Why didn't the U.S. sign this convention earlier since we all know that the convention in question got started in December 2003? Mr. Babenasolo Nampoina Assistant Director in charge of Education and Communication within BIANCO an independent office for the fight against corruption in Madagascar A [U.S. Officials Discuss UNCAC - Liz Verville]: The United States signed the Convention when it was first opened for signature in December 2003. We then began our internal processes to secure Senate advice and consent to ratification. Because of the importance of the Convention and its broad scope, we conducted wide consultations within our private sector including the U.S. business, legal and NGO communities to inform them about the Convention. Preparation of the ratification documentation also takes time, as well as allowing time for Senate consideration. Our goal was to be a party before this first Conference of States Parties, and we are very pleased that we became a party last month and to be able to attend this meeting as a party. Q [Shamim Ahmed]: It is believed all corrupt money is deposited in Swiss Bank -- why U.S. government does not press for disclosing the names of depositors? A [U.S. Officials Discuss UNCAC - Gerald Anderson, Deputy Assistant Secretary of State for International Organizations Affairs]: Shamim, one of the most important issues addressed in the convention is the recovery of assets lost to corruption. In its chapter on asset recovery, the Convention addresses the issue of detection and prevention of transfers of the proceeds of crime and of combating money laundering. It also addresses mechanisms for international cooperation in confiscation of such assets. Q [Marek]: Beyond big international agreements what can average person do to fight corruption? A [U.S. Officials Discuss UNCAC - Liz Verville]: Each person should adhere to the highest standards of personal integrity in his or her daily dealings. If everyone did that, we would not need treaties! [This is Gerald Anderson, Deputy Assistant Secretary of State for International Organizations Affairs]: Marek, that is a great question. While the UN Convention may seem remote from the life of the average person, in fact if you take a look at it you will find that it addresses issues that average individuals face in their daily lives. For example, the average person can refuse to give or take bribes, can discourages others from giving or taking bribes, teach their children that bribery is wrong and weakens society as a whole. Average individuals can also support leaders who are willing to make the principles embodied in the Convention a reality. Progress takes time. But it doesn't happen unless individuals take action. Q [Guest]: From Madagascar: It is always said in our country, poverty is linked with corruption. How could manage a poor country to avoid corruption and stand as a model? A [U.S. Officials Discuss UNCAC - Andrew Haviland]: Madagascar, poor countries arguably have the most at stake in the fight against corruption. There are many steps poor countries can take, starting with recognizing the high cost of corruption and demanding change. International organizations, both public and private, offer help through training and information sharing. Individuals may feel powerless to make a difference, but that's where change must start. Collective action is also very important. World Bank research shows that countries that tackle corruption and improve the rule of law can increase national income by as much as four times in the long term. Child mortality can fall by as much as 75%. This provides very strong motivation for change. Remember that fighting corruption is a shared responsibility of government and the private sector, including businesses, civil society, and the media. Q [Shamim Ahmed]: Why Bangladesh fails to get access to MCA despite improvement in TI corruption perception index? A [U.S. Officials Discuss UNCAC - Andrew Haviland] Shamim, I am afraid that I cannot discuss the eligibility of a specific country for the Millennium Challenge Account (MCA). However, anticorruption efforts is certainly one of the criteria for eligibility that is a must. All the criteria are available and fully explained on the MCA web site. Thanks to everyone for joining this discussion. I found it very informative. It is important that we get the word out about corruption so that everyone understands the costs and commits to combating it together. Moderator: Please stay online! Mr. Anderson and Mr. Brandolino are reviewing the remaining questions. Q [Harijan]: How long has the UN been working on the UNCAC? Who initiated the UNCAC? What is the mechanism for monitoring and reporting progress of signatory nations? A [U.S. Officials Discuss UNCAC - John Brandolino]: The process to negotiate UNCAC began about five years ago, when governments met in Vienna in August 2001 to develop terms of reference for the negotiations, which ultimately involved over 130 countries and continued over a two-year period. The idea for UNCAC did not come from one particular country, but, rather, there were a number of governments -- and non-governmental organizations -- that believed that we needed to develop a comprehensive global standard and set of international commitments for fighting corruption. The main body for monitoring and reporting on the progress of implementation is the Conference of States Parties, which is meeting here in Jordan as I type this. However, the Conference is not the only way to build political will and report on implementation. Countries are already discussing and promoting UNCAC implementation at regional and multilateral levels, and non-governmental actors and the private sector are and will be active in raising awareness in this area. Q [Sancy]: Magyarul is hozza lehet szolni a dolgokhoz? A [U.S. Officials Discuss UNCAC]: Nem ertem Magyarul. A [U.S. Officials Discuss UNCAC - Liz Verville and John Brandolino from Jordan]: We enjoyed this session, but now need to return to the Conference plenary, which just reconvened a few minutes ago. We are delighted to see such interest in the Convention, and, most importantly, in international anticorruption efforts. Good afternoon from Jordan! This is Gerald Anderson. Thank you to all participants for your interest in this important issue and for your excellent questions. Moderator: We wish to thank our webchat guests for their time. The webchat is now closed. A transcript of today’s webchat will be available on this site shortly and on our USINFO webchat station within one business day.
U.S. Officials Discuss Efforts To Combat Global Corruption
Bureau of International Information Programs
USINFO Webchat Transcript
Date: December 12, 2006
Time: 7:00 a.m. EST (1200 GMT)