30 May 2001
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29 May 2001
(Jackovich speaks at Global Forum in The Hague)(2285) The U.S. ambassador to a center for security research in Europe says that only by working together can countries attempt to fight corruption. Victor Jackovich, ambassador to the George C. Marshall European Center for Security Studies in Garmisch-Partenkirchen, Germany, said that rapid electronic money transfer makes containing corruption in any one place more difficult than ever. He made his comments May 29 to a workshop in The Hague at the Second Global Forum on Fighting Corruption and Safeguarding Integrity. He said democratization has too often been accompanied by corruption while improved communication technology has made corruption easier to accomplish. Jackovich emphasized the danger of corruption of law enforcement agencies, military forces and intelligence agencies -- the very people who are supposed to be fighting corruption. The ambassador said national governments must strengthen their oversight of national security, military and law enforcement agencies by passing appropriate laws and implementing them. Developing countries should adopt transparent government regulation, create a public work force based on merit and require accountability of public officials and institutions, Jackovich said. Yet success requires both strong national government oversight and international cooperation, he said. "Cross-border mechanisms are most successful when domestic institutions are strong, democratic and fully developed," Jackovich said. "One dimension of this issue cannot be deployed successfully without the other." Following is the text of Jackovich's remarks as prepared for delivery: (begin text) Remarks by Ambassador Victor Jackovich Associate Director George. C. Marshall European Center for Security Studies Garmisch-Partenkirchen, Germany "CORRUPTION WITHIN SECURITY FORCES: A THREET TO NATIONAL SECURITY" Global Forum on Fighting Corruption and Safeguarding Integrity Ministry of Justice Hague, Netherlands May 29, 2001 Introduction Thank you. It is an honor to help represent the United States government and, ore specifically the George C. Marshall European Center for Security Studies, a joint American and German institution, at this Global Forum on Fighting Corruption and Safeguarding Integrity. I would like, first of all, to express my gratitude to the Ministry of Justice of the Netherlands and the organizers of the forum for extending an invitation to me to participate. Among other things, I would like to share with you some of the highlights and results developed at a conference held just one week ago at the Marshall Center's headquarters in Garmisch, Germany. That conference dealt with the problem of corruption in national security services, including law enforcement agencies, customs, border police and armed forces. The Marshall Center conference was sponsored by the U.S. and German governments, whose specialists also participated, and it was attended by high-ranking representatives of some 30 other governments, mostly from Eastern Europe, the former Soviet Union and Southeast Europe. The fact that the Marshall Center was the venue for this event demonstrated the importance my government gives to this issue. The recognition is universal that crime and corruption are major destabilizing elements not only in newly emerging democracies, but in older states as well. The all-pervasive nature of this threat has spawned renewed interest in identifying ways to combat it. This was the driving force behind our conference a few weeks ago in Garmisch. The Threat of Corruption to Transition Societies The United States and other Western governments and societies have not necessarily been more adept or more intelligent in developing or deploying tools necessary for combating organized crime and corruption. But, we have been perhaps more successful, if only because -- unlike states in transition -- we are not facing the challenges of reform simultaneously with the problems of organization crime and corruption. But, having identified corruption and crime as major threats to stability and security, we recognize that they are, therefore, a threat to our own welfare. For this reason, assemblies such as this Forum, that bring together specialists from a variety of countries and professions, can make a valuable contribution to the battle against these threats. Today, criminality and corruption are truly transnational phenomena. Some organized crime networks are so large and powerful that they have the capacity to hold an entire small state hostage, to infiltrate government agencies and to merge illegitimate activities into legitimate enterprise. Law enforcement agencies -- and even military forces and intelligence services -- can be corrupted, their "trade craft" borrowed and their members co-opted. An even more insidious dimension of the problem, however, is the corrosive effect on society at large. There is the danger that the population of a newly emerging state could begin to perceive criminality and corruption as ineluctable elements in the process of transition. There are probably only two directions from such a point once it is reached: acceptance of criminality and corruption as permanent elements in society, or rejection of the entire transition process and of democratization. Neither path is positive. Results of Marshall Center Conference From May 14 through 18, together with the U.S. government's Federal Bureau of Investigation (FBI) and the German government's "Bundeskriminalamt" (BKA), the Marshall Center in Garmisch, Germany co-sponsored a Euro-Atlantic conference entitled "Corruption within Security Forces: A Threat to National Security." This conference looked for ways in which organized crime and corruption are already being confronted by various states, but in addition explored some new methods. And, as I noted previously, the entire focus was on corruption in the armed forces and related services, such as intelligence, police and customs. Approximately 120 high-ranking government officials from some 25 states in the Euro-Atlantic community participated in the conference, together with specialists, academic figures, journalists, NGO representatives and others. A significant number of members of national parliaments also attended and were particularly vocal about the need to pass new legislation, and the need to ensure expeditious implementation of laws where they are already on the books. Attendees included: the Chairman of the Kyrgyz Parliamentary Commission on Corruption; the Lithuanian Minister of Interior; the Albanian Minister of Public Order; the head of the district court in the capital of Bulgaria; the Chairman of the Russian Parliament's Subcommittee on Transnational Crime, the Chairman of the Romanian Parliament's Committee on Economic Affairs; the Vice President of European Parliament and the Deputy Director of the Council of Europe's anti-corruption initiative called "GRECO." As I mentioned earlier, several prominent American and German law enforcement representatives also participated. One of the most fascinating aspects of this conference in Garmisch, Germany was to observe the cohesion between military and non-military specialists, including policy-makers, when it came to the subject of corruption. What emerged was a clear consensus that corruption is basically the same in all contexts, and that government officials of various agencies must work together in order for the battle against criminality and corruption to be successful. Beyond this, during the full week of discussions and workshops, the participants recognized four basic conclusions: -- First, fundamental changes in Eastern Europe over the past decade have resulted in tremendous forward progress on democratization, engagement of citizenry in the political process and development of market economies. But, these changes have also been accompanied by massive social, political and economic disruption, creating an environment conducive to corruption and organized crime. -- Second, "globalization" -- loosely defined as the age of more rapid communication, easier international travel and more technological innovation -- has given the purveyors of crime and corruption some potent tools. For this reason, corruption and criminality can permeate an entire state apparatus and present formidable cross-border threats. -- Third, the problems of crime and corruption are all the more acute when they directly involve the armed forces, law enforcement agencies, border police and customs. This is not only because these are important pillars of the state. It is also because these are the very institutions that are charged with the task of safeguarding the security of everyone else in the state. -- Fourth, and finally, strong international cooperation is essential if organized crime and corruption are to be successfully countered. This is why regional initiatives are so valuable in the shorter term. And, this is why assemblies such as this current Global Forum can make enormous contributions. But, the participants at the Marshall Center conference not only surveyed the problems and their origins. They also actively exchanged ideas on what measures could be taken in the future-- by individual states and by regional associations -- to improve efforts to combat organized crime and corruption. In this regard, I identified four major conclusions: -- First, government oversight, especially by national parliaments, over national security, military and law enforcement agencies must be strengthened. Equally important, controls and oversight within individual agencies must also be improved. -- Second, and connected with the first point, a legislative frame-work must be activated. This means adopting new laws where none now exist, and implementing laws where they do already exist. -- Third, there is a crucial need for the highest levels of political leadership to provide genuine support for their country's battle against corruption. This includes ensuring implementation of existing laws, exercising real oversight and clearly demonstrating an intolerance for corruption. -- And fourth, and finally, a culture of rejection of criminality and corruption must be developed, in place of any tendency to continue a culture of acceptance. By the way, the vast majority of participants at this conference came from states in transition. Perhaps not surprisingly then, one of the points they continually made was that the U.S. and West European states need to make more efforts to reduce the "demand" side, which could in turn reduce the prosperity for corruption on the "supply" side. In brief, those are the highlights of trends identified and solutions explored at the Marshall Center conference on corruption in security forces, held just a few weeks ago in Garmisch, Germany. This event was one in a series of conferences and seminars we intend to continue on this subject. The Way Forward It is clear that a successful battle can be waged against corruption and organized crime, or that we can at least reduce the deleterious impact crime and corruption have on our societies, on our states and on security and stability. But, it is equally clear that this must be done in ways that integrate many players in a society; that encourage active involvement of a strong civil society and media; and, that engage popular opinion from the bottom up, as well as political will of leadership from the top down. In order for reform strategies to succeed, they must combine the efforts of fighting corruption within national political and economic borders with the efforts of fighting corruption on an international scale. In other words, cross-border mechanisms are most successful when domestic institutions are strong, democratic and fully developed. One dimension of this issue cannot be deployed successfully without the other. Some key measures that emerge as critical to the process are the following: Strengthening government oversight. Whether through Parliaments of through other official bodies, strong government oversight over national security forces -- including customs, military and intelligence services -- can be a major factor in fighting corruption. This is why the United States and many others in the international community put such emphasis on rendering assistance to the development of Parliament committees, staffers and other agencies. Harmonizing regulations and transition processes. Newly emerging democracies can eliminate significant opportunities for corruption and crime by harmonizing their laws, regulations and practices with those of the rest of Europe and the international community. Specifically, processes such as privatization of denationalization of property, a formidable challenge faced by virtually every one of the new states of Eastern Europe, can be made more transparent and the results more public. Developing a merit-based public service cadre. In many newly emerging democracies, public servants and even those in national security forces, are often selected on the basis of loyalty to a particular party or politician. This is one reason why elections can be such traumatic ordeals in these states. There is a dire and urgent need to train and develop a cadre of professionals in government agencies, including the security forces, that can provide professionalism and expertise on a continuing basis without fear of arbitrary removal of reprisal. Requiring accountability of public officials and institutions. Elected officials should be held accountable to the public through transparency of their transactions and their acquisition of personal wealth. In addition, national institutions -- such as banks, service industries and security's forces -- should come under scrutiny; in cases of significant transfers of holdings or cash, or in cases of significant amounts of procurement of equipment. This presupposes an active and objective media, as well as a vibrant and involved network of citizens associations and non-governmental organizations (NGOs). Conclusion In the end, the stability and security of the most vulnerable of states is of vital interest to the stability and security of the entire international community. We are only as strong as our weakest link. In our modern age of instant transference of funds and rapid exchange of information via the Internet, the world's inter-connectivity has grown and developed at a pace never before experienced. Even if we wanted, we could not consign criminality and corruption to certain states or societies and give as the excuse that these problems are endemic or natural in those parts of the world. Under these circumstances, it is clear that we must work together -- West and East, developed and developing, traditional democracies and newly emerging states in transition -- in order to wage the fight against corruption, in order to win that battle and in order to secure a better life for our children. Thank you. (end text) (Distributed by the Office of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
30 May 2001
(Levine cites need for cooperation, shared responsibility)(2510) Preventing foreign aid from abetting corrupt practices in the beneficiary country remains a challenge for donor countries, a U.S. Agency for International Development (USAID) official says. Neil Levine, senior adviser for governance at USAID, said the agency has developed a number of ways to prevent fraud and abuse in foreign aid. He made his comments May 29 to a workshop at the Second Global Forum on Fighting Corruption and Safeguarding Integrity in The Hague. Levine said USAID has begun training staffs in beneficiary countries on identifying fraud and enforcing laws against fraud. Another challenge is coordinating anti-corruption activities among bilateral and multilateral donors, he said. Levine suggested that donor institutions working on the same country project should form joint assessment teams to analyze the problem in order to plan a coordinated response. He said donors should encourage anti-corruption conventions among beneficiary countries and monitor the performance of such conventions. Donors should also provide financial support to non-governmental organizations in the beneficiary countries to build their capacity to prevent corruption of foreign aid. Following are terms and abbreviations used in the text: -- USAID: U.S. Agency for International Development -- USG: U.S. government -- IG: inspector general -- OAS: Organization of American States -- IDB: Inter-American Development Bank -- IMF: International Monetary Fund -- NGO: non-governmental organization -- CSO: civil society organization -- OECD: Organization for Economic Cooperation and Development -- G-5: United States, Japan, Germany, France, United Kingdom -- TI: Transparency International Following is the text of Levine's remarks: (begin text) Introduction Thanks to Minister Herfkens for the invitation to participate on this particular panel and in general, to commend our hosts for this very successful conference. From the range of its participation to the scope of the topics under discussion, it truly is a Global Forum. Most importantly, however, it is not just an international gathering of individuals. It is a gathering of the momentum behind the international movement to fight corruption. The Perspective of a Bilateral Donor No nation is immune from the problem of corruption. Scanning the headlines of any daily newspaper from any of the countries here in attendance, one will find not just one, but several examples of betrayals of the public trust in one form or another. In giving advice in this area, it's better to offer it as a pragmatist rather than a moralist. As a pragmatist, USAID engages in anti-corruption as a development issue: -- Because the marginal cost of corruption is so much greater in the developing world, where resources are scarce to begin with. -- As a donor, we are interested in what works programmatically. -- We are interested in practical ways to see that donor efforts are better coordinated. Part of a Broader Relationship: Our assistance takes place in the context of a broader political relationship between nations where issues that affect that relationship -- like corruption -- can be raised directly in the course of our ongoing policy dialog. Some would say that bilateral donors are more likely than multilateral institutions to push on anti-corruption issues -- that is true, although it's not always true. Political will: We should be increasingly aware of political will to fight corruption, not only in recipient countries, but among the donors in each developing country context. Strong donor coordination can help overcome a single donor's reticence to engage in a given country. Such reticence is only natural given the differences in history, governmental structure and internal political dynamics in our countries. Donor coordination will allow us to use our differences as a source of strength, allowing us to pitch-in for each other. Flexibililty/Agility: 1) loan v. grant; 2) variety of partners; 3) able to call on other USG agencies (Many of those institutions -- our Justice Department, Customs Service, USAID's Office of the Inspector General, the Treasury Department and the Office of Government Ethics, are part of the Global Forum.) THREE CRITICAL CHALLENGES -- Keeping Foreign Aid Clean -- Donor Coordination -- Sustainability Challenge Number One is Keeping Foreign Aid Clean While this seems an obvious place for donors to begin, it remains a challenge for a number of reasons. First, our ability to mount and sustain a long-term institutional response to corruption depends in large part on our ability to remain completely accountable for the assistance we now provide. Support for anti-corruption assistance is the single issue that seems to unite supporters and critics of foreign assistance in our Congress and in our country. Second, as long as there is leakage, fraud and waste, we will continue to undercut the individuals and the institutions we wish to support. Finally, with corruption now a front-burner issue in so many countries, we have an opportunity to make long-lasting institutional changes that will help change the way we do business. Let me provide you with some examples. Role of the IG: USAID's Office of the Inspector General (IG) is charged by the Congress to perform audits and investigations of U.S. government agencies' program and operations, promote agency economy, efficiency, and effectiveness, and help prevent fraud and abuse. Internal Controls: By law and regulation, the U.S. has established a system of control in order to fulfill our responsibilities as careful stewards of U.S. taxpayers' money. (As our president likes to say, it's not the government's money, it's people's money. When money comes from our Congress, we implement programs in trust on behalf of the U.S. government and, ultimately, the American people.) Supreme Audit Institutions: But accountability for these funds does not and should not rest only with donors. In addition to our system of internal controls, the Office of Inspector General has undertaken an aggressive campaign to identify, support and enhance the capacity of Supreme Audit Institutions in the counties where we work. Over time, with the necessary training and other support, the audit function once performed internally can now be transferred to the host country. The Supreme Audit Institution in Tanzania, for example, recently audited nearly $9 million in USAID funding. Similar audits are taking place in Zambia, Ethiopia, Honduras and El Salvador, just to name a few. Prevention/Fraud Awareness: Keeping Foreign Aid Clean does not rest on internal controls alone. The most effective, least costly method to fight corruption is prevention. Again, USAID's Office of the Inspector General has begun training courses in Fraud Awareness, not just for USAID staff, but for our implementing partners in country. This training includes an in-depth presentation of fraud indicators, and introduction of aggressive law enforcement strategies, which enhance our ability to deter corrupt acts. When they do occur, we are better able to detect, investigate and prosecute cases where warranted. In fact, a recent IG investigation has led to the prosecution of several multi-national corporations for bid rigging. As a result, these companies have been ordered to pay over $100 million in criminal fines and civil restitution. The second challenge is donor coordination. Again, this is not a news flash. But what may be new is the opportunity to develop better mechanisms for ensuring that our work is effective, well targeted and not duplicative. If there is any good news, it may be that there are some examples of donor cooperation that have been successful and merit further exploration and use. Accountability and Anti-Corruption in the Americas Project (AAA) One example of successful donor coordination was the creation of the Donor Consultative Group on Accountability and Anti-Corruption in the Americas, now knows as the AAA Project. Over the course of 12 years, the project moved from eight to nineteen bilateral and multilateral institutions including the U.S., Canada, Germany Japan, the Central American Bank for Economic Integration, the OAS, the IDB, the IMF, World Bank Institution, the UN and others. The early years focused on financial management and the donor forum helped to devise a division of labor whereby a single donor would take the lead in a particular country, coordinate the needs assessment and propose ways to institutionalize integrated financial management systems in national entities. Today, virtually every country in the hemisphere has undertaken financial management system reforms using a similar model developed under the project. The donor forum continues to meet quarterly to share information. Its next challenge is aimed a bringing these financial management reforms to the sub-national level, working with municipalities. A state of the art website (www.respondanet.com) makes anti-corruption resources widely available. According to a recent ranking done by websmost-linked.com, an independent Internet rating service, respondanet is in the 8.9 top percentile of the most visited websites -- IN THE WORLD. Coordination with NGOs: The project has expanded to include civil society organizations (CSOs) with a sub-project called Anti-corruption Without Borders (ACWB). It promotes the use of the Internet as an indispensable tool for all CSOs engaged in anti-corruption activities in the region. Maintained in both English and Spanish (Anti-Corrupcion Sin Fronteras), it allows NGOs an opportunity to share resources, information, exchange ideas via list-serves and generally serves to link anti-corruption CSOs across the region. Technical assistance in website construction and design is also available. OECD Anti-Corruption Network for Transition Economies Another example in Eastern Europe, USAID is providing initial support for the operation of the OECD Anti-Corruption Network for Transition Economies. This anti-corruption initiative serves the Baltics, Central and Eastern Europe and the New Independent States. It links international donors, key government officials, and civil society representatives in a forum to exchange information about anti-corruption policies and best practices. Building upon existing regional initiatives, the Network co-ordinates efforts, shares information, and promotes international instruments and best practices as benchmarks. Best Practices Field-Based Coordination with Parallel Mechanisms at the Capital Level: As a highly decentralized, field based organization operating in over 80 missions around the world, USAID tends to believe that the best donor coordination occurs first at the field level. Because not all bilateral and multilateral donors have a technical field presence, we have found that field level efforts are even more effective if there exists a parallel donor coordination mechanisms at the level of the capitals. Experience with Consultative Groups and other mechanisms such as those undertaken by the bilateral donors and the IDB following Hurricane Mitch represented an advance in this type of parallel donor coordination. Lessons form Hurricane Mitch -- Broad Donor Consensus on Objectives of Reconstruction: embodied in the Stockholm Declaration -- committed a reconstruction based on transparency and good governance and coordination of donor efforts. -- Field-based Coordination -- led by G-5 and broadened to all interest donors. Allowed donors to coordinate efforts, speak with one voice on policy maters and to avoid duplication at the programmatic level. -- Parallel Mechanisms at the Capital Level -- Rotating chairmanship among the G-5 took place at the field level and the capital level. This ensured a continuity and coherence of policy -- in the field and in the capitals and most importantly at the Consultative Group meetings. Three Concrete Suggestions: In the area of anti-corruption, we have two suggestions that we believe will assist in the effort to improve donor coordination. The first is the use of joint assessment teams -- meaning multi-donor technical representatives -- sent to analyze a given country so that we can begin with a common reference point as to the nature of the problem and begin to plan a coordinated response. To that suggestion, we would add the suggestion of cross training -- meaning providing opportunities to our technical officers to participate in each other's respective training programs. Each December, USAID brings in over 100 of its field based democracy officers for training. We would like to open spaces for interest donor representatives to participate and share their experiences in the training mode. We have also developed a distance-learning module, available on CE, which we would like to share with those interested for comment and critique. Third, we believe a new area for donor coordination has emerged with the development of regional anti-corruption conventions and agreements. These agreements give us an agreed upon set of goals. Now begins the hard work of bring institutions into compliance, as well as establishing effective peer- and civil society monitoring mechanisms. As donors, we need to be active, not only in our support for the passage of conventions, but especially for the monitoring work and institutional development that must follow. The clear terms of these agreements make this an area where we can more easily work together. The third challenge is sustainability of anti-corruption efforts. With the launch of various anti-corruption initiatives over the last several years, we are now running into the challenge of making these donor-supported efforts sustainable over the medium and long-term. Again, some good examples exist. USAID's work with Supreme Audit Institutions is aimed at raising the institutional capacity of these entities to continue to do their jobs on a sustainable basis. In the non-governmental sector, I know that this is a prime concern of Transparency International, an organization we are proud to have supported, almost from the beginning. In order to maintain the independence necessary to be an impartial advocate for anti-corruption reforms around the world, TI, and other similar organizations, should ideally be freed from year-to-year reliance on donors. To this end USAID will work with TI and with other donors on a long-term sustainability strategy. More generally, the lesson for donors, we believe, is not to underestimate the degree of capacity building that will be needed, in addition to technical assistance and financial support -- and the duration of that need -- in order to create sustainable institutions. Concretely, it should be a requirement of donor engagement in the anti-corruption area that beyond the cost of the programs we want to support, that we accept responsibility for the institutional development costs for NGOs. All of us need to provide organizational development, capacity development, and financial management assistance. We all need to be aware of the temptation to be a "free-rider" in the donor community -- yet if all of us provide only the "program costs" how will local organization acquire the organizational capacity to carry-out programs and develop the sustainability needed for long term anti-corruption programs that extend beyond our development projects. We have found that there are no "one-shot deals" when it comes to funding effective anti-corruption initiatives. As we bring discussion of this once taboo subject out into the open, we need to find ways to support efforts that go beyond raising awareness. Ultimately, we must help countries change the incentives that lead to corruption -- by driving home the costs of corruption on development; by reducing the opportunities for the exercise of unlimited discretion and by penalizing bad behavior when it occurs. Donor Endurance over Donor Fatigue: These are long-term challenges that are first and foremost to be faced by the countries themselves. In anti-corruption, our slogan should be donor endurance rather than donor fatigue. (end text) (Distributed by the Office of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)