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  • 8/7/2019 Quah-Corruption in Asian Countries

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    Corruption in Asian Countries: Can It Be Minimized?

    Jon S. T. Quah

    Public Administration Review , Vol. 59, No. 6. (Nov. - Dec., 1999), pp. 483-494.

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    Jon S.T Quah,National University of Singapore

    Can corruption be combatted? Yes, but only under certain cir-

    cumstances! Tha t appears to be the experienceo f h i a n countries

    where corruption i s ubiquitous with the exception of Singapore-

    a country tha tproved to be the only success story wit h a strong

    political leadership and betterpay scales. Can this experience bereplicated?

    T h r e e d e c ad es a g o , G u n n a r M y r d a l ( 1 9 6 8 ,938-939) identified the taboo o n research onSouth Asian corruption as one of the factorsi n h i b i t i n g t h e r e s ea rc h o f h i s b o o k , A si anDrama. However, this taboo no longer exists,judging from the increasing amount of researchon cor rup t ion in As ian coun t r i e s in r ecen tyears. According to the Far Eastern EconomicReview, corruption was the biggest story of1996, the Year of the Rat, as a great deal of"newsprint and television time was devoted toreports and discussions on corruption in gov-ernme nt" (G hosh et al., 19 97, 18 ). Further-more, the financial crises in Thailand, SouthKorea, Malaysia, and Indonesia in 19 97 havehighlighted the problems of corruption, crony-

    ism, and nepotism on one hand, and the needfor more accountabil i ty and transparency ingovernment and banking operations in thesecountries on the other hand .

    W hy is corruption such a serious problem inAsian countries? Is it possible to control or tominimize corruption in these coun tries? Th ispaper contends that the extent of corruption inAsian (and other) countries depends on two fac-

    tors: (1) the nature of the causes of corruptionin these countries; and (2) the degree of effec-tiveness of the measures initiated by politicalleaders to combat corruption. In order to curbcorru ptio n in Asian countries, th e causes of cor-rup tion mu st first be correctly diagnosed so thatpolitical leaders can take appropriate action tominimize, if not eliminate, such causes. Asianc o u n t r i e s l i k e S i n g a p o r e a n d H o n g K o n g ,

    which observe this logic of corruption control,are more successful in combatting corruptionthan other countries (Quah, 1995).

    Public Admin istration Review NovemberlDecember1999,Vol. 59, No. 6

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    This paper is divided into three sections. In the firstsection, the different levels of corruption in Asian coun-tries are discussed. Section two describes the anticorrup-tion strategies employed in several Asian countries. Theconcluding section focuses on Singapore's experience,demonstrating that, while it is difficult to curb corrup-tion, it is nonetheless possible to do so if a country'spolitical leaders have the commitment or will to impar-tially implem ent effective anticorruption measures.

    Levels of Asian CorruptionIn September 19 74 , the Fa r East Economic Review fea-

    tured the cover story "C orruption: Th e Asian Lubricant,"which surveyed corruption in 10 Asian countries. Th earticle concluded that:

    If you want to buy a Sherman tank, a Red Crossblanket, or simply speed up the installation of atelephone, there is probably no easier place in theworld in which to do just that than in Asia-if yo uare willing to part with some cash, that is. With- -pathetically few exceptions, the countries in thisregion are so riddled with corruption that the pay-ing of "tea money" has become almost a way of life(Far East Economic Review, 1974, 3).

    Th is picture of pervasive corru ption in Asia is supp ort-ed by individual portraits of corruption in such countriesas Bangladesh, the People's Republic of China, HongKong, Ind ia, Japan, Laos, Pakistan, Taiwan, an d Thaila nd(Far East Economic Review, 19 74 ,2 2- 3 1 ).

    As it is no t possible to m easure the actual extent of cor-rup tion in a country, scholars usually rely o n the reportedextent of corruption. Lancaster and M ontinola (19 97, 1 6)

    have observed that students of political corruption usewritten documents (press reports, judicial records, andrecords from anticorruption agencies) and survey data tomeasu re co r rup t ion . As t he se i n s t rumen t s a r e no tproblem-free, they have recommended the use of the Co r-rup tion Perception Index (C PI) , published by Transparen-cy International in 199 5 and updated in 199 6 and 1997,because it is a "robust" index that "captures more than asingle indicator" and "combines several measures of politi-cal corruption for each country" (Ibid., 27-28).

    According to Transparency International, the CPI is"an attem pt to assess the level at which cor ruptio n is per-ceived by people working for multinational firms andinstitutions as impacting on commercial and social life"(TI Newsletter, 1996, 5 ) . The Business Internat ionalIndex (BII) is based on surveys of experts or consultantsconducted during 1980-1 983 by Business International,which is now a subsidiary o f the E conomist's IntelligenceUnit. T h e BII ranks countries from 1 to 1 0 according to"the degree to which business transactions involve cor-ruption or questionable payments" (Wei, 1998, 3).

    Unlike the CPI and BII, the Global CompetitivenessReport Index (GC RI) is based o n a 199 6 survey of firmmanagers, who were asked quest ions about different

    Table 1Perceived Levels of Corruption in Asian Countries-- - - - - - -Country BII CPI97 GCR197

    (I-lo scale )* (1-loscale)* (1-7scale)*Singapore 1.00 2.34 1.24Hong Kong 3.00 3.72 1.52Japan 2.25 4.43 2.07Taiwan 4.25 5.98 3.22Malaysia 5.00 5.99 3.97

    South Korea 5.25 6.71 4.34Thailand 9.50 7.94 5.55Philippines 6.50 7.95 5.56People's Republic

    of China NA 8.12 4.10India 5.75 8.25 5.1 1Indonesia 9.50 8.28 5.56Pakistan 7.00 8.47 NABangladesh 7.00 9.20 NA

    Source: Wei, 1998, 5.

    *According to W ei, the original BII, CP I, and GC RI were re-scaled sothat higher scores imp ly mor e corruption. Th us, for all three indices,a higher score means a higher level of corruptio n.

    aspects of competitiveness in the host countries wherethey invest. Specifically, 2,38 1 firms in 58 countries wereasked to rate the level of corruption on a one-to-sevenscale according to t he e xtent of "irregular, additional pay-ments connected with import and export permits, busi-ness licenses, exchange controls, tax assessments, policeprotection or loan applications" (ib id., 4).

    Table 1 shows the levels of corru ption in 1 3 Asiancountries according to the three indices, the B II, CPI , andGC RI. Singapore is perceived to be th e least corrupt Asiancou ntry by all three indices. This perception is confirmedby the Hong Kongbased Political and Economic Risk

    Consultancy Ltd., whose 1996 survey showed that Singa-pore "maintained its reputation as a 'corruption-free'haven in a region in which shady practices are all toocom mo n" (S traits Times, 1996 , 3) . Conversely, Indonesiaand Thailand were perceived as the most corrupt Asiancountries on the BII. The CPI ranked Bangladesh as themost corrupt Asian country, and the GCRI identifiedIndonesia and the Philippines as the two Asian countrieswith the highest levels of corruption.

    Table 1 also indicates th e different levels of cor rup tionin 13 Asian countries. W ha t accounts for the variationsin the extent of corru ption in these countries? To answerthis question, it is necessary to examine the anticorrup-tion strategies employed by seven of these countries toascertain whether they have observed the logic of corrup-tion control.'

    Anticorruption Strategiesin Asian C ountries

    The consequences of corruption can be minimized ifgovernment has an effective anticorruption strategy andimplements it impartially. Specifically, the more effectiveanticorruption measures are, the greater their impact on

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    Table 2A Matrix of Anticorruption Strategies

    Anticorruption Measures

    Adequate Inadequate

    Commitment of Strong Effective strategy 1 Ineffective strategy 2political leadership

    Ineffective strategy 1 Hopeless" strategy

    Source: Quah, 1982, 175.

    the society in terms of reducing the negative effects andthe level of corruption. The effectiveness of anticorrup-tion measures depends on two factors: (1) the adequacyof the measures in terms of the comprehensiveness oftheir scope and powers; and (2) the level of commitmentof political leaders to the goal of minimizing corruption.In other words, for anticorruption measures to be effec-tive, they must be properly designed (to attack the causesof corruption), and they must be sponsored and upheld

    sincerely by political leaders. In short, the most elaborateand well-designed anticorruption measures will be uselessif they are not enforced by the political leadership (Quah,1982, 174-175).

    By juxtaposing these two variables, the adequacy ofanticorruption measures and the commitment of politicalleadership, a matrix of anticorruption strategies can beobtained (see Table 2).

    Table 2 shows four strategies for combatting corrup-tion, depending on the adequacy of the anticorruptionmeasures employed and the strength of political leaders'commitment. This matrix of anticorruption strategies

    can be used to analyze the anticorruption efforts of sever-al Asian countries.To be effective, anticorruption strategies must mini-

    mize-if not eliminate-the causes of corruption. In hiscomparative study of the control of bureaucratic corrup-tion in Hong Kong, India, and Indonesia, Leslie Palmier(1985, 271) identified three important causes of corrup-tion in these countries: opportunities (which dependedon the extent of civil servants' involvement in the admin-istration or control of lucrative activities), salaries, andpolicing (that is, the probability of detection and punish-ment) . According to Palmier,

    [Blureaucratic corruption seems to depend not onany one of the [three] factors identified, but ratheron the balance between them. At one extreme,with few opportunities, good salaries, and effectivepolicing, cowuption will be minimal, at the other,with many opportunities, poor salaries, and weakpolicing, it will be considerable (emphasis added).(272)

    Following Palmier's hypothesis, effective anticorrup-tion strategies should reduce or remove opportunities forcorruption, raise the salaries of civil servants, and ensure ahigh degree of policing.

    SICA Jubilee: Corruption in Asian Countries: Can It Be Minimized?

    "Hopeless" Anticorruption Strategy

    Given the perceived high levels of corruption of Asiancountries as indicated in Table 1, it is not surprising thatthe "hopeless" anticorruption strategy has been used incountries such as China, Indonesia, and Bangladesh; cor-ruption in these countries has been institutionalized, astheir anticorruption measures are inadequate and theirpolitical leaders are not at all concerned about minimiz-

    ing corruption.People2 Republic of China: The high level of corrup-tion in the People's Republic of China (PRC) can beattributed to the low wages of civil servants, the manyopportunities for corruption during the last two decadesof Deng Xiaoping's modernization policy, and the lack ofpolitical will in implementing anticorruption measuresagainst senior party officials. Indeed, although briberyexceeding 100,000 Yuan is a capital offense, the deathpenalty has not been imposed on senior party officialsfound guilty of accepting such bribes.2

    Several public opinion polls conducted during the late1980s in the PRC indicated that the public had identi-fied corruption as "the most prevailing social crime" andconfirmed its resentment of corruption (Gong, 1994,135). In fact, the corruption issue was an important cata-lyst for the student demonstrations in the spring of 1989as "the students' anticorruption banner appealed stronglyto the public." After the Tiananmen Square incident, theChinese media "dramatically increased the exposure ofcorruption cases to highlight the party's determinationand efforts to repress corruptions" (ibid., 137). The Chi-nese Communist Party sought to clear its image by intro-ducing new anticorruption rules designed to (1) strength-en centralized control over certain commodities andproduction materials; (2) forbid such "unhealthy prac-tices" as gift giving in public affairs and squandering pub-lic funds; and (3) punish offenders through the stipula-tion of disciplinary penalties for embezzlement (ibid.,139-140).

    In 1982, the Central Discipline Inspection Commis-sion (CDIC) was reestablished to deal with discipline andanticorruption work. Five years later, the Ministry ofSupervision (MOS) was also reestablished "in par t t ocurb corruption and maladministration within the civilservice." Even though the MOS had received more than

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    700 ,000 r eport s in 1 993 , bo th the C D IC and M O Scould not stem the problem of corruption because the"authorities appear[ed] to lack the political will to handlecorruption cases among more senior party members"(Burns, 19 94, 57-58).

    So far, only two senior party officials have been con-victed of corrupt ion i n recent years. In 1994, Li Yiaoshi,former Vice-Minister of the State Science an d Technolo-gy Commission, was sentenced to 20 years in jail for cor-ruption (ibid., 58). O n July 31, 1998, the former Beijingparty chief, Chen Xitong, became the highest-rankingparty ;ember to be jailed for corrup tion when he wassentenced to 16 years for graft of 555, 000 Yuan an d dere-liction of duty. As corruption is a capital offense in thePRC, Chen's sentence is lenient; more junior party cadreshave been sentenced to life imprisonment or even deathfor corruption involving smaller sums over 100,000 Yuan(Straits Times, 1998, 14). The death penalty is imposedon officials who accept bribes exceeding 100,000 Yuan,or US$12,000 (Wang, 19 98, 5). In short, party officialsin the PRC can "short-circuit corruption investigations

    by appealing to their protectors in the party hierarchy"(Root, 1996, 752).

    Indonesia: In Indonesia, cor rup tion was a seriousproblem during the Dutch colonial period, as it was rifeamong the Du tch Eas t Ind ia Company ' s pe r sonne lbecause of their low salaries. However, this traditionaltolerance for corruption was eroded during the postwarperiod, when corruption was viewed more critically as theenhanced role of the public bureaucracy had increasedopportunities for bureaucratic corruption (Quah, 1982,154-1 55). Corrup tion became endem ic during PresidentSukarno's rule because his "disastrously inflationary bud-

    gets eroded civil service salaries to the poi nt w here peoples imply cou ld no t l i ve on them and where f inanc ia laccountability virtually collapsed because of administra-tive deterioration" (Mackie, 1970, 87-88).

    Corruption remained a serious problem and becameinstitutionalized during the 32 years of Suharto's term ofoff ice. According to H ann a (1971, I ) , corrupt ion inIndonesia has "become so inst i tut ionalized" that "i tseradication ... might mean the critical dislocation of thewhole shaky national structure." Indeed, Suharto and hisfamily had "extensive business interests" and "benefitedfrom what appears to be privileged access to governmentcontracts"(Girling, 1997, 56).

    The Indonesian government 's f irst at tempt to curbcorrup tion occurred after the 1 95 5 election; it resulted inthe arrests of those involved, including civil servants anda minister. In June 1968, Suharto assigned the task oftackling corruption cases to the Tedm PemberantasanKorupsi (Corruption Eradication Team), which was, how-ever, ineffective because its efforts were blocked by influ-ential men in the regime (Quah, 1982, 170 ). Studen tprotests in January 1970 and press criticism of govern-ment corruption resulted in the appointment of a specialCommission of Four elder statesmen (KomisiII/) by Pres-

    In Indonesia,. .traditional tohncefor corruption

    war eroakd during the postwar period, when corruption

    wds viewed more critically as the enhanced role ofrhe

    public bumucrary had incredsed opportunitiesf ir

    bureaucratic corruption.

    ident Suharto to review the problem of corruption with inthe c ivi l se rvi ce an d to make r ecom menda t ions foimprovement.

    This commission presented seven reports on thoseagencies and areas that were judged to be vulnerable tocorruption to President Suharto from February to June1970. Perhaps the most important consequence of thesreports was the passing of the Prevention Against Corrupt Criminal Acts Bill in 1971; previously, corruptionwas dealt with as a crime under the penal code. Suhart

    accepted the commission's recommendation that civil servants should submit an annual return of their personaassets, and h e published an instruction in 197 0 requirinall officials to conf orm accordingly. However, civil servants ignored this regulation for nine years, and it waonly in 1979 that 90 percent of the officials submittedtheir annual returns (Palmier, 1970 , 12). Th is examplillustrates clearly that laws in Indonesia are not alwayimplemented , especia l ly ant icorrupt ion laws, as theimplementation of such laws would prevent co rrupt officials from continuing their practices.

    In June 1977, the task of co mbatting corruption wa

    transferred by presidential instruction fro m the Com mission of Four to th e National Securi ty Agency (Kopkamtib), which launched Operation Orderliness (OperasTertib or Opstib) by making "lightning visits" to governme nt departments known for corruption, dismissing officials caught red-handed on the spot. Even though Kopkamtib had taken action against corrupt officials, itmajor handicap was "its inability to take action againsthose generals and senior g overnm ent officials involved incorrupt practices" (Quah, 1982, 171).

    "The family business," or the corruption involvingSuharto's family, grew without restraint du ring the 1980and 1990s. Toward the end of Suharto's term, especiallduring the late 1990s, public criticism of his family'sinvolvement in corrupt practices mounted, culminatingin his relinquishment of power in May 1998 . As the system of corruption in Indonesia has become."deeplyingrained" during the past 32 years of Suharto's rule, iwill be difficult for his successor, President B.J. Habibieto eradicate corruption. In other words, even thoughSuharto is no longer in power in Indonesia today, hislegacy of widespread corruption will remain for a longtime. Indeed, according to Shari and E inhorn (1998,33) ,"the qualities that rank the country as the world's mos

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    Thehck ofcommitment by Bangizdehpoliticalleaders is jr st manijsted in thefact that 'many elected

    oficialr, including mtmbm ofparliament and

    are known to be involved in hge-scale anuption."

    corrupt after Nigeria won't be erased with a change ofpresidency [as]... the bureaucracy runs on miserably lowsalaries, so until civil servants make a living wage, briberywill remain."

    Bangladesh: In Bangladesh, a 199 7 national householdsurvey on corruption conducted for Transparency Inter-national Bangladesh confirmed the country's perceivedhigh level of corruption, as revealed by the followingfindings:

    41% of households paid a "donation" and 3.6% adirect payment for the admission of children into

    - .

    schools, while 36% of households made payments

    to or through hospital staff or other "influentialpersons" to secure admission into hospitals. 65%had bribed land registrars for recording a falselower sale price when registering a land transac-tion, while 54% had bribed either bank employeesor "influential persons" to secure bank loans. 33 %paid money to obta in e lec t r ic i ty connect ions ,while 32% paid less for water "by arrangementwith the meter reader." 47% were able to reducethe holding tax assessment on house and property"by arrangement with municipal staff on paymentof money," whi le 65% found i t imposs ib le to

    obtain trade licenses without money or influence.63 % of those involved in litigation had paid bribesto either court officials or the opponents' lawyers,89% of those surveyed being of the v iew thatjudges were corrupt. 97% thought the police ser-vice was corrupt. (Quoted in Jayawickrama, 1998,3)

    Similarly, businessmen in Bangladesh have complainedthat "their high costs are due to the payoffs they have tomake to government officials for sanctions, bank loans,and permits" (Kochanek, 1993, 199 ). Indeed, accordingto one businessman, "I get sick in my stomach wheneverI h a v e t o se e a g o v e r n m e n t o f f i c ia l " ( Q u o t e d i nKochanek, 1993, 199 ).

    T he politics of patronage an d corru ption have plagueda l l governments in Bangladesh s ince 197 1 , bu t theErshad government has been described by one business-man as "the most centralized and corrupt in the country'shis tory" (Kochanek, 1993 , 264-265). Unde r GeneralErshad, corruption was pervasive and included petty cor-ruption, project corruption, and programmatic corrup-tion (Kochanek, 1993, 259). These three forms of cor-r up t i o n " l ed t o a mas s ive g a p be tw een p o l i cy andimplementation," as under Ershad, "law and policy had

    SICA Jubilee: Corruption in Asian Countries: Can Ir Be Minimized?

    little meaning" as "decisions were made on an arbitrarybasis with little accountability or appealn (Kochanek,1993,266-267).

    In his analysis of bureaucratic culture in Bangladesh,Mohammad Mohabbat Khan (1998, 35) identified cor-ruption as a dominant component, as it has been institu-tionalized in the public service during the last 25 years.He attributed Bangladesh's high level of corruption tofour factors:

    First, bureaucrats involved in corrupt practices inmost cases do not lose their jobs. Very rarely they

    . .

    are dismissed from service on charges pertaining tocorruption. S till rarely they are sent to prison formisusing public funds. They have never been com -pelled to return to the state their ill-gotten w ealth.Second, the law-enforc ing off ic ia ls inc ludingpolice personnel are extremely corrupt. They arehappy to sha re t he boo ty wi th o the r co r rup tbureaucrats. Th ird, the people have a tendencynot only to tolerate corruption but to show respectto those bureaucrats who made fortunes through

    dubious means.... Fourth, it is easier for a citizento get quick service because he has already "paid"the bu reauc ra t r a the r t ha n wa i t fo r h i s t u rn .(Khan, 1998,36)

    The lack of commitment by Bangladesh 's pol i t icalleaders is first manifested in the fact that "many electedofficials, including members of parliament and minis-ters, are known to be involved in large-scale corruption"(Khan, 1998, 36) . A more im portant m anifestation ofthe lack of political will in fighting corruption is thet r a ns f e r o f t h e d i r e c t o r - g e n e ra l o f t h e B u r e a u o fAnti-Corruption to the Ministry of Education because

    of his "crusade against corruption" and his unwillingnessto stop the probe against four ministers, many membersof Parliament, and several senior civil servants in May1995. Khan (1998, 37) concludes pessimistically, butcorrectly, that the "bureaucratic and political elite will[not] start a campaign against corruption in public life asit adversely affect their individual, group and coterieinterests."

    Ineffective Anticorruption Strategies

    T he second an d third cells of the matrix of anticorrup-tion strategies in Table 2 represent two types ofineffectiveanticorruption strategies (strategies 1 and 2). Ineffectivestrategy 1 occurs when anticorruption measures are ade-quate but the political leadership's commitment is weak,thus resulting in the nonenforcement of anticorruptionmeasures. This lack of political will can be seen in th eineffec ti ve an t i co r rup t i on s t r at eg i es a d o p t e d i n t hePhilippines, S outh Korea, and Thailan d.

    The third cell of ineffective strategy 2 is possible butunlikely in reality, as political leaders who are stronglycomm i t t ed t o e r ad i ca t i ng co r rup t i o n w i ll p r o bab lyimprove inadequate anticorruption measures, instead of

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    being satisfied with inadequate anticorruption measures.No ne of the 1 3 Asian countries listed in Table 1 fall intothis category.

    The Philippines: Co rru ptio n was introduce d int o thePhilippines during the Spanish colonial period, whengraft an d co rrup tion prevailed because civil servants werepaid low salaries and had many opportunities for corruptbehavior (Corpuz, 1957, 129). In contrast, the bureau-cracy of the American co lonial period (1898-1913) was

    less corrupt, as "the bureaucrats received higher salariesand corrupt officials were promptly prosecuted" (Qu ah,1982 , 1 59). However, graft and corruption flourished inthe Philippines after World War 11, and the bureaucracysuffered f rom " low pres t ige , incompetence , meagerresources, and a large measure of cynical corruption"(Corpu z, 19 57, 222-223).

    Bureaucratic corruption was a serious problem duringthe 1950s, especially during the administration of Presi-dent Elpidio Quirino (1948-1953); during his tenure,corruption "permeated the entire Philippine bureaucracy"(Alfiler, 19 79, 323 ). Accordingly, Qu irin o created th e

    Integrity Board in Ma y 195 0 to investigate complaints ofgraft and corruption against civil servants. However, theIntegrity Board was dissolved five months later, as it didnot receive public support.

    When Ramon Magsaysay won the presidential elec-tion in 195 3, he established th e Presidential Co mp laintsand Action Commission (PCAC) to reduce inefficiencya n d d i s h o n e s t y i n t h e c i v i l s e r v i c e . H o w e v e r ,Magsaysay 's d eat h in 19 57 gave r i se to th e Garciaadmin i s t r a t ion (1957-1 962) , wh ich abo l i shed thePCAC and replaced it with the Presidential Committeeon Adm inistration Performance Efficiency and th e Pres-

    idential Fact-Finding Com mittee in 195 8 to implementthe government ' s ant i -graf t campaign. In February19 60 , Garcia crea ted a th i rd ant i -graf t comm it tee ,known as the President's Anti-Graft Committee (ibid.,331-337).

    Garcia's successor, Diodsdado Macapagal, establishedthe Presidential Anti-Graft Com mittee. In 1965, Maca-pagal was replaced by Fe rdinand Marcos, who abolishedthat com mittee and formed th e Presidential Agency onReforms and Gov ernme nt Operations (PARGO ) in Jan-uary 1966. Thre e other agencies, the Presidential Com -plaints and Action Office, the Complaints and Investi-gations Office, and the Special Cabinet Committee inBacksliding, were later created to assist the PARGO inits task of wee ding ou t corruption (ibid., 339-346).

    According to Varela (1995,174), "graft and corrup-tion reached its all time high during the martial lawregime under Marcos," as corruption "had permeatedalmost all aspects of bureaucratic life and institutionswhich saw the start of the systematic plunder of thecountry." Indeed, the tremendous amount of "officialcorruption" that was practiced by Marcos, his family,an d friends during his two decades in power was only dis-covered after his downfall in February 1986. The plun-

    dering of the country's wealth by the former first familywas revealed by Pedrosa:

    The documents [discovered by the investigatorsfor the Aquino government] outlined the Mar-coses' formula fir systematic plunder. They hadamassed their wealth through bribe-taking andkickbacks from crony monopolies; through thediversion of government loans and contracts;through the profits from over-priced goods and

    construction; through unaudited government rev-- -enue, usually raised fromtaxes; and through theexpedient of taking over businesses by decree andthe diversion of yet more funds fromgovernment-controlled entities.Nothing wasspared. .. [The Marcoses had stolen] a staggering$15 billion, more than half of the entire nationaldebt of the Philippines (emphasis added).(1987,221-222)

    When President Corazon Aquino took over in February 1986," there was high expectation t ha t the end of theculture of graft and corruption was near" (Varela, 1995

    174). She created the Presidential Commission on Go odGovernment (PC GG ) to identify and retrieve the moneystolen by the Marcos family and their cronies. Unfortunately, Aquino's "avowed anti-graft and corruption"stance was viewed cynically by th e pub lic after two of heCabinet members and her relatives were accused of corruption. The PCGG also became a target for charges ocorruption, favoritism, and incompetence; by mid-1988five PC GG agents faced graft charges an d 13 more werunder investigation. In M ay 1987, Aquino establishedt h e P r e s i d e n t i a l C o m m i t t e e o n P u b l i c E t h i c s a n dAccountability in response to increasing public criticism

    However, this committee was hindered by a shortage ostaff and funds (Timb erman , 1991, 233-234). In shortas Carino has indicated, Aquino's "honesty has not beenmatched by the poli t ical wil l to punish the corrupt"(Quoted in ibid., 235).

    In his study of the consequences of low salaries on theprestige of the Philippine Civil Service, Padilla (1995195-202) fou nd th at civil servants augm ented their lowwages by vending w ithin the office, holding a second jobteaching part-time, practicing their profession after offichours, and engaging in research and consultation projects. O n the o ther h and , civil servants could also aug-me nt their low salaries by resorting to petty c orru pt practices (ibid., 206). Indeed, as long as civil service salarieremain low in the Philippines, it will be extremely difficult to minimize corruption. Unfortunately, Aquino'ssuccessor, Fidel Ramos has failed to minimize c orru ptiontoo, as the salaries of civil servants have not beenincreased and he did not demonstrate his political will infighting corruption.3

    South Korea: Co rru ptio n has been a serious problemin So uth Korea since the sixteenth century, whe n the participation of the king's family in politics led to "increas-ing nepotism and corruption in administration" (Rah

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    I South Korea since the sixteenth centuyman , 1986 , 119 ). As a result of corruption scandals inrecent years, Sou th Korea has been described as "a RO T C(Republic of Total Corruption) by the people and massmedia"(Kim, 1994,215).

    The fight against corruption began with PresidentPark Chu ng Hee, w ho assumed office in M ay 1961 afterousting the government of Chang Myon because of itsinvolvement in corruption, its inability to defend thecountry from co mm unism, an d its incompetence in initi-ating economic and social change (H an, 1989, 273). Parkformed the Board of Audit and Inspection (BAI) in 19 63to act as a "direct check on the economic bureaucracy"(Hart-Landsberg, 199 3, 54). In o ther words, the BAI wasthe first defdcto anticorruption agency in So uth Korea. InMarch 1975, Park introduced the Seojungshaeshin (Gen-eral Administration Reform) Movement to curb corrup-

    tion in the civil service (Oh, 1982, 324); the number ofcivil servants prosecuted for corruption increased from21 ,919 in 19 75 to 51 ,468 in 1976 (Rahman , 1986 ,122).

    Pa rk 's a s sass inat ion in Oc tobe r 197 9 l ed to theassumption of power a year later by his successor, ChunDo o H wan , who reaffirmed his government's anticorrup-tion stance by purging corrupt public officials and intro-ducing ethics laws to reward honest officials and toenha nce the structures for civil service reform (Jun, 19 85,63). However, Chun's government lacked legitimacybecause of opposition by rival political parties, student

    leaders, intellectuals, and progressive Christians (Han,198 9, 283-284). Chun's unpo pularity led to his retire-men t in F ebruary 19 88 at the end of his seven-year term.He, his two brothers, and his wife's family were accusedof massive corrupt ion, and o n November 23, 1988 ,Ch un and his wife apologized for their m isbehavior andreturned 13.9 billion Won (US$20 million) to the gov-ernment.

    Chun's successor, Roh Tae Woo, was plagued by the"long-festering problem of political corruption," with sixlegislators found guilty of extorting funds from the busi-ness community. Th e 1992 Ha nbo scandal shocked thecountry when Chung Tae Soo, chairman of the HanboConstruction Company, was accused of contributing sub-stantial funds to ruling and opposition p olitical parties forfavors involving land development ("Korea-South," 1992,138). However, Roh himself was not immune: in Octo-ber 19 95 it was discovered that he had received almost$600 million for his private political fund from individu-als and major business conglomerates (Macdonald andClark, 199 6, 159-160).

    When Kim Young Sam assumed power in February1993, he voluntarily declared his personal assets of 1.7billion Won (US$2.1 million) and gave up golf, which

    SICAJubilee: Corr uptio n in Asian Countries: Can ItBe Minimized?

    "had become a symbol of corporate-government cronyism and the exchange of corru pt gifts." H e issued a presidential decree in August 1993 that Koreans must usetheir real names for all financial transactions, especiallybank accounts, as the "anonymous or false-name accounhad been the backbone of the black economy and massive fraud, corruption and tax evasion schemes" (Sheridan, 1997, 13-15). Mo re importantly, Kim strengthenedthe BAI, which became the first de jure anticorru ption

    agency in South Korea. He created the Commission fothe Prevention of Corruption, an advisory body of private citizens formed to assist the BAIs chairman in fighting corruption. In March 1993, the government formeda team of 100 special inspectors within the BAI to im plement Kim's anticorruption campaign. By August 1993the BAI had 776 officials involved in audit and administrative inspection. Article 24 of the BAI Act empowerthe BAI to conduct anticorruption activities by examining civil servants' behavior.

    President Kim's anticorruption campaign confirmedthat corruption is a way of l ife in South Korea and

    exposed its pervasiveness in the country. H owever, YoungJong Kim (1994, 207) has lamented the lack of politicawill in S outh Korea's efforts to curb corru ption, especiallunder the regimes of Presidents Rhee, Park, and ChunAlthough Kim's anticorruption drive was hindered by theMay 17, 1997, arrest of his son for bribery and tax evasion in the Hanbo loan scandal and his sentencing tothree years' imprisonment five months later, Kim hasclearly demonstrated his com mitm ent to eliminating corruption by no t obstructing the legal arrest and sentencinof his son. Nevertheless, the Hanbo scandal and his son'sarrest and imprisonment seriously undermined Kim's

    legitimacy and jeopardized the continued success of hianticorruption drive. Whether Kim's commitment tocurbing corruption will be continued by his successorKim Dae Jung, remains to be seen.

    Tha ihnd: Like South Korea, the origins of corruptionin Thailand can be traced to the sixteenth century, whencivil servants withheld revenue collected for the king fothemselves, as they were not paid regular salaries, andsent only a small amount to the king (Chai-Anan, 19771, 4). T he Board of Inspection a nd Follow-up of Government Operations was establishedas the first de jure anti-corruption agency in September 1972. It was ineffectivehowever, as its five members were guilty of corruptionthemselves and the group was dissolved after the Octobe19 73 revolution.

    In May 19 74, Pr ime Minis ter Sanya appo inted aCou nter C orrup tion C om mittee to investigate charges ocorruption against civil servants and to report its findings. This com mittee was required to prepare an anticorruption draft bill to supplement the inadequate penacode. T he C abinet approved the draft bill and in December 1974 sent it to the National Legislative AssemblyThe Assembly passed the bill, and the Counter Corruption Act (C CA ) was enacted in February 1975 . Th e CC A

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    changed the Coun te r C or rup t ion C omm i t t ee t o t heCommission of Coun ter Corrup tion (C CC ), which con-sists of a chairma n a nd between five an d nine m embers.

    T he C C C set ou t to investigate allegations of corrup-tion against civil servants an d subm its to the ca binet pro-posals for preventing corruption and for revising admin-istrative practices. However, the C C C was ineffective fort h r e e r e a s o n s . F i r s t , a c c o r d i n g t o M u l d e r ( 1 9 9 6 ,173-174), " the idea of corruption, meaning tha t the

    external world should not be exploited for personal gainbecause it constitutes th e pub lic interest" was "so baffling[to the Thais] tha t it lames all Anti-Corru ption Com mis-sions at the outset." Second, the CCC could not curbcorruption because of the constant conflict between theCabinet and bureaucracy (Dalpino, 1991, 66). Finally,the C C C was viewed by its critics as a "paper tiger" with-out real teeth, as "it could only send reports to the primeminister and the Cabinet" since it lacked "direct authori-ty to punish public officials." Consequently, very few civilservants have been punished for corruption.

    The CCC's ineffectiveness led to the CCA's amend-

    me nt in 198 7 to give it more power (Amara, 1992, 240).In spite of this amen dmen t, the C C C still cannot takeaction against politicians, and it "only has the power toinvestigate a bureaucrat following a com plaint." Officialsfound guilty by the C C C are usually reprimanded or dis-ciplined within the department, as the public prosecutordoes not use the evidence collected by the C C C to initi-a te new inves t iga t ions (Pasuk and Sungs idh , 1994,180-181).

    Thailand's anticorruption strategy was described as"hopeless" by Qu ah (19 82 , 175-176) 16 years ago, as thecountry's anticorruption measures were inadequate and

    its political leaders unconcerned about minimizing cor-ruption. Indeed, most Thai political leaders (with a fewexceptions, such as prime ministers Anand Panyarachunand Chuan Leekpai) have not been committed in thefight against corruption. However, the si tuat ion hasimproved recently after Chuan Leekpai replaced GeneralChavalit Yongchaiyudh as prime minister in November1997. Furthermore, the Const i tut ion promulgated onOctobe r 11, 1 997 , or the "People's Constitution," is con-cerned, among other things, with making elected politi-cians and p ublic officials accountable by intr odu cing sev-eral measures to curb corruption. Specifically, codes ofconduct for politicians and civil servants have been for-mulated to prohibit conflicts of interest. They are alsorequired to declare their assets , l iabi l i t ies , and theirincome tax returns (and those of their dependents) to theC C C when they assume a nd leave office an d on e yearafter leaving office. The CCC has been strengthened to"enable it to bring cases to c ourt a nd to cover the cases ofpolitical officials" (Prudhisan, 199 8, 275-276).

    In short, Thailand's anticorruption strategy has beentransform ed from a hopeless strategy to an ineffective oneas its current prime minister, Chuan Leekpai, is con-cerned about minimizing corruption. Th e newConsti-

    ISingaporeis the least mrm*t ina, t o n ,1 accordingto the three indices, However, the situation 1 quite d@rent in Singapore during the British colo1period, when corrupion wai a way of l$,tut ion has introduced addit ional ant icorruption mea-sures, including the empowerment of the CCC. Howev-er, whether Thailand's anticorruption strategy can betransformed into an effective one will depend on howlong Chuan Leekpai remains prime minister and theextent to which the new anticorruption measures areactually implemented.

    Effective Anticorruption Strategy

    T h e final antico rrup tion strategy is th e effective strate-gy, which occurs when adequate anticorruption measures

    are in place and political leaders are strongly committedto eradicating corruption. O f the 13 countries listed inTable 1, only Singapore and H on g Kong, the two leastcorrupt Asian city-states, come under this category. Bothhave adequate anticorruption measures (Prevention ofCorruption Act and the Corrupt Practices InvestigationBureau in Singapore, and the Prevention of Bribery Ord i-nance and the Independent Commission Against Cor-ruption in Hong Kong); both are blessed with politicalleaders who are determined to remove the problem ofcorruption in their countries (Quah, 1995).

    The final section of this paper will discuss Singapore's

    effective anticor rup tion strategy, with the aim of showinghow corruption can be minimized when political leadersare sincerely com mitte d to this task by impartially imple-men ting comprehensive an ticorruption m easures.

    Learning from Singapore's FxperienceAs Table 1 indicates, Singapore is the least corrupt

    country in Asia today according to the three indices.However, the situation was quite different in Singaporeduring the British colonial period, when corruption was away of life. Th e 187 9 and 188 6 Comm issions foun d thatbribery an d c orruption were prevalent am ong th e StraitsSettlement Police Force in Singapore. Indeed, an analysisof the Straits Times from 1845 to 1921 shows that 17 2cases of police corruption were reported during this peri-od (Quah, 1979, 24). Corruption was also widespreadduring the Japanese occupation (1942-1945), as rampa ntinflation m ade it difficult for civil servants to live on theirlow salaries. The situation deteriorated during the post-war period, and in his 19 50 Annual Report, the C om-missioner of Police revealed that graft was rife in govern-ment departments in Singapore.

    W he n t he Peoples Action P arty (PAP) leaders assumed

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    office in June 1959, they realized that corruption had tobe curbed to ensure that the Singapore Civil Serviceattained the country's development goals. They also real-ized that they could not continue the British colonialgovernment's incremental anticorruption strategy if theirintention was to minimize corruption. Accordingly, thePAP government's immediate tasks were twofold-tominimize corruption and to change the public perceptionof corruption as "a low-risk, high-reward" activity to "a

    high-risk, low-reward" activity. In 1960, a comprehensiveanticorruption strategy was introduced with the enact-ment of the Prevention of Corruption Act and thestrengthening of the Corrupt Practices InvestigationBureau (CPIB). Because corruption is caused by bothincentives and opportunities to become corrupt, the newcomprehensive strategy was based on the "logic of cor-ruption control," as "attempts to eradicate corruptionmust be designed to minimize or remove the conditionsof both the incentives and opportunities that make indi-vidual corrupt behavior irresistible" (Quah, 1989, 842).

    Reducing the Opportunities for Corruption

    Singapore was a poor country in 1960, with per capitagross national product of S$ 1,330, or US$443 (Republicof Singapore, 1986, ix). As such, the PAP governmentcould not afford to combat corruption by raising thesalaries of its civil servants. It was left with the alternativeof strengthening the existing legislation to reduce theopportunities for corruption and to increase the penaltyfor corrupt behavior. Corruption was first made illegal inSingapore in 1871 with the introduction of the PenalCode of the Straits Settlements. The first specific anticor-

    ruption law was introduced on December 10, 1937,when the Prevention of Corruption Ordinance (POCO)was enacted. The POCO was amended in 1946 toincrease the penalty for corrupt offenses from two tothree years and/or a fine of S$10,000, and to enable thepolice to arrest corrupt individuals without warrants.

    The Prevention of Corruption Act (POCA) was enact-ed on June 17, 1960, and included five important fea-tures to elim inate the PO CO 'S deficiencies and toempower the CPIB to perform its duties. First, thePOCA's scope was increased to 32 sections, in contrast tothe POCO'S 12 sections.4 Second, corruption was explic-itly defined in terms of the various forms of "gratifica-tion" in section 2, which also identified for the first timethe CPIB and its director. Third, to enhance the POCA'sdeterrent effect, the penalty for corruption was increasedto imprisonment for five years and/or a fine of S$10,000(section 5). The amount of the fine was further increasedto S$100,000 in 1989. Fourth, a person found guilty ofaccepting an illegal gatification would be fined theamount of the bribe, plus any other punishment imposedby the court (section 13). Finally, the fifth and mostimportant feature of the POCA was that it gave the CPIBmore powers and a new lease on life. It provided CPIB

    SICA Jubilee: Corrupti on in Asian Countrie s: Can It Be Minimized?

    officers with powers of arrest and search of arrested per-sons, and it empowered the public prosecutor to autho-rize the CPIB's director and senior staff to investigate"any bank account, share account or purchase account"of anyone suspected of having committed an offenseagainst the POCA. Section 18 enabled the CPIB officersto inspect a civil servant's banker's book and those of hiswife, children, or agent, if necessary (Quah, 1978,10-13).

    To ensure the POCA's effectiveness, the PAP govern-ment amended it as necessary or introduced new legisla-tion to deal with unforeseen problems. In 1963, thePOCA was amended to empower CPIB officers torequire the attendance of witnesses and to question them.This amendment enabled CPIB officers to obtain thecooperation of witnesses to help them in their investiga-tions. In 1966, two important amendments were intro-duced to further strengthen the POCA. First, section 28stated that a person could be found guilty of corruptioneven if he did not actually receive the bribe, as the inten-tion on his part to commit the offense constituted suffi-

    cient grounds for his conviction. The second amendment(section 35) was directed at those Singaporeans workingfor their government in embassies and other governmentagencies abroad: Singapore citizens could be prosecutedfor corrupt offenses committed outside Singapore andwould be dealt with as if such offenses had occurredwithin the country. In 198 1, the POCA was amended forthe third time to increase its deterrent effect by requiringthose convicted of corruption to repay the money theyreceived in addition to facing the usual court sentence.Those who could not make full restitution would begiven heavier court sentences.

    On December 14, 1986, then-Minister for NationalDevelopment Teh Cheang Wan committed suicide, 12days after he was interrogated for 16 hours by two seniorCPIB officers regarding two allegations of corruptionagainst him by a building contractor. Teh was accused ofaccepting two bribes amounting to S$ l million in 198 1and 1982 from two developers to enable one of them toretain land which had been acquired by the government,and to assist the other developer in purchasing state landfor private development. An important consequence ofthe Commission of Inquiry that followed was the enact-ment on March 3, 1989, of the Corruption (Confisca-tion of Benefits) Act 1989, which concerned the confisca-tion of benefits derived from corruption; it stipulates thatif a defendant is deceased, the court may issue a confisca-tion order against his estate.

    The CPIB is the anticorruption agency responsible forenforcing the POCA's provisions. It has grown in size bynine times, from eight officers in 1960 to its currentestablishment of 71 officers, comprising 49 investigatorsand 22 clerical and support staff. The CPIB performsthree functions: (1) to receive and investigate complaintsconcerning corruption in the public and private sectors;(2) to investigate malpractices and misconduct by public

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    officers; and (3) to examine the practices and proceduresin the public service to minimize opportunities for cor-rupt practices (CPIB, 1990, 2).

    Reducing Incentives for C orruptio n

    The PAP government was able to implement only thesecond prong of its comprehensive anticorruption strate-gy-the reduc tion of incentives for cor rup tion byimproving salaries and working conditions in the civilservice-in the 1980s long after it had achieved econom-ic growth. The improvement of wages began in March1972, when all civil servants were given a 13-month non-pensionable allowance comparable to the bonus in theprivate sector. This allowance was not aimed at curbingcorruption, but enhancing working conditions in thecivil service in comparison to the private sector.

    Perhaps the best justification for the PAP government'sapproach to combatting corruption by reducing orremoving the incentives for corruption by improvingpolitical leaders' and senior civil servants' salaries was pro-

    vided by the former Prime Minister Lee Kuan Yew inParliament on March 22, 1985, when he explained whythe wages of the Cabinet ministers had to be raised. Hecontended that political leaders should be paid the topsalaries that they deserve in order to ensure a clean andhonest government. If they were underpaid, they wouldsuccumb to temptation and indulge in corrupt behavior.According to Lee, Singapore needed a corruption-freeadministration and an honest political leadership to pre-serve its most precious assets. He concluded that the bestway to deal with corruption was by "moving with themarket," which is "an honest, open, defensible and work-

    able system" instead of hypocrisy, which results in duplic-ity and corruption (Straits Times, 1985, 14-16).Apart from reducing the incentives for corruption, the

    1. As space limitations and limited access to data do not per-mit a discussion ofall the 13 countries, only the anticorrup-tion strategies of the PRC, Indonesia, Bangladesh, thePhilippines, South Korea, Thailand, and Singapore will beanalyzed in this paper.

    2. A great deal of research has been done on corruption in the

    PAP government had to improve the salaries and workingconditions in the civil service to stem the "brain drain" ofcompetent senior civil servants to the private sector byoffering competitive salaries and fringe benefits to reducethe gap between the two sectors. Accordingly, the salariesof civil servants in Singapore were revised upwards in1973, 1979, 1982, 1989, and 1994 to reduce the drainto the private sector and the salary gap in the two sectors.As a result of these salary revisions, senior civil servants inSingapore earn perhaps the highest salaries in the worldcompared with their counterparts in other countries. Forexample, the basic monthly salary of the highest grade(staff grade V) is S$38,799, or US$25,866 (Straits Times,1993, 28); this is much higher than the top monthlysalary for the United States Federal Service, which isUS$7,224, or S$11,631 (Wright and Dwyer, 1990,6).

    Singapore's experience demonstrates that it is possible tominimize corruption if there is strong political will. Con-versely, if such political will is lacking, the situation ishopeless, as political leaders and senior civil servants ormilitary officers will pay only lip service to implementing

    anticorruption measures. On the other hand, it might bedifficult for other countries to replicate and transplant Sin-gapore's experience in curbing corruption for two reasons:Singapore's unique policy context differs from that of othercountries; and the prohibitive economic and political costsof paying political leaders and civil servants high salariesand reducing the opportunities for corruption.

    Jon S. T. Quah is a professor of political science at theNational University of Singapore. He has publishedwidely on public administration in Singapore and otherAsian countries, with emphasis on administrative reform,

    anticorruption strategies, and human resource develop-ment. He is a member of Transparency International'sGovernance Council.

    PRC in recent years. See, for example, Gong (1994), Gong(1997), Kwong (1997), and Mulvenon (1998).

    3. Fo r a recent treatment of corruption in the Philippines, seeCoronel (1998).

    4. The POCA now has 37 sections as a result of subsequentamendments.

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