The Many Faces of Corruption: Tracking Vulnerabilities at the Sector Level

Contents......Page 7
Foreword......Page 13
Preface......Page 17
Contributors......Page 19
Acknowledgments......Page 29
Abbreviations......Page 31
Introduction Tackling a Social Pandemic......Page 35
Part I Combating Corruption: Sectoral Explorations......Page 61
1 Corruption and Pharmaceuticals: Strengthening Good Governance to Improve Access......Page 63
2 Maximizing the Performance of Education Systems: The Case of Teacher Absenteeism......Page 97
3 Crime and Justice in the Garden of Eden: Improving Governance and Reducing Corruption in the Forestry Sector......Page 123
4 Corruption in the Electricity Sector: A Pervasive Scourge......Page 149
5 Making Inroads on Corruption in the Transport Sector through Control and Prevention......Page 193
6 Corruption in the Petroleum Sector......Page 225
7 Tackling Corruption in the Water and Sanitation Sector in Africa: Starting the Dialogue......Page 255
Part II Corruption and the Public Financial Management System......Page 299
8 Exploring Corruption in Public Financial Management......Page 301
9 Corruption in Public Procurement: A Perennial Challenge......Page 329
10 Combating Corruption in Revenue Administration: An Overview......Page 369
Combating Corruption in Revenue Administration: The Case of VAT Refunds in Bolivia......Page 373
11 The Challenge of Combating Corruption in Customs Administrations......Page 401
Part III Where Goes the Money?......Page 421
12 Money Laundering and Corruption......Page 423
Part IV The Challenges Ahead......Page 461
Conclusion Where to Next?......Page 463
Index......Page 469
1.1 Global Action Tackling Corruption in Pharmaceutical Systems......Page 65
1.2 Mekong Region Tackles Fakes to Reduce Rates of Antimalarial Resistance......Page 70
1.3 Different GMP Requirements Can Have Unintended Implications: India......Page 71
1.4 Leading Drug Makers Embrace RFID Technology to Secure Supply......Page 72
1.5 Approaches for Meeting Drug Registration Challenges......Page 74
1.6 Political Leadership and Public Engagement Essential to Tackling Counterfeit Drugs: Nigeria’s Experience......Page 75
1.7 Azerbaijan’s Experience in Reducing Counterfeit Drugs......Page 76
1.8 Failure to Fully Specify Product in the Drug List Has Led to Underdosing......Page 77
1.9 Assessing the Vulnerability to Corruption in Pricing: The Balkans......Page 79
1.10 Drug Leakage and Theft in Uganda: Strategies for Prevention......Page 83
1.11 Prescribing Guidelines and Conflicts of Interest......Page 86
2.1 Reasons for Teacher Absenteeism......Page 105
2.2 Code of Ethics for Teachers......Page 113
2.3 Potential of an EMIS Program......Page 114
2.4 Detecting and Reducing Absenteeism......Page 115
2.6 Local Monitoring of Education Can Help Reduce Teacher Absenteeism......Page 117
3.1 Examples of Corruption in the Forest Sector......Page 124
3.2 Earnings from Legal and Illegal Logging: A Decomposition and Analysis for Indonesia......Page 126
3.3 Potential Solutions to End Resource Windfalls, Rent Seizing, and Institutional Erosion......Page 129
3.4 Alchemy through International Trade: Transforming Illegal to Legal in the Forest Sector......Page 130
3.5 The Kimberley Process Certification Scheme for Conflict Diamonds......Page 135
3.6 Strengthening Detection and Suppression in Cambodia: Achievements and Pitfalls......Page 137
3.7 Involving Local Communities in Forest Protection in the Philippines......Page 138
3.8 Improving Transparency in Forest Administration in Ecuador......Page 139
3.9 Legislative and Administrative Reforms in Bolivia......Page 140
3.10 Experience with Regional FLEG Processes......Page 142
4.1 Cost of Corruption: Eliminating Losses Could Also Eliminate Supply Gap......Page 152
4.2 The Poor Bear the Brunt of Corruption......Page 154
4.3 Cost of Poor Investment Decisions and Less than Transparent Procurement......Page 159
4.4 Who Wants Accountability?......Page 162
4.6 Community Participation and Good Governance......Page 163
4.7 OPCOM Power Exchange: Improving Governance of Public Utilities in Romania......Page 166
5.1 Case Study Examples of the Mechanics of Collusion in Road Civil Works......Page 204
5.2 Private Sector Integrity Pacts......Page 220
6.1 L’Affaire Elf......Page 234
6.2 Corruption in Pertamina......Page 236
6.3 The Giffen Case......Page 237
6.4 Extractive Industries Transparency Initiative......Page 246
7.1 Utility Officials Extort Bribes from Small Water Providers in Nairobi......Page 269
7.2 Institutional Reforms Improve Utility Performance in Nairobi......Page 279
7.3 Intensive Efforts to Curb Corruption in Village Infrastructure Development: Lessons from Indonesia......Page 283
8.1 Corruption Patterns......Page 307
8.3 Key Factors for SAIs and Examples......Page 318
9.1 Prequalification: What Could Go Wrong?......Page 346
9.2 Dirty Tricks at Public Bid Openings......Page 347
9.3 Monitoring Bid Evaluation: Early Warning Indicators......Page 350
9.4 Tracking Contract Administration: Yellow Flags......Page 351
9.5 Three Examples of the Potential Benefits of a Well-Functioning E-Procurement System......Page 354
9.6 Using an Integrity Pact in Public Procurement of Garbage Collection Services in Argentina......Page 357
10.1 The ARGOSUR Case......Page 388
11.1 The Difficulty of Detecting Corruption Networks at Remote Customs Offices......Page 403
11.2 Bribery in the Case of Cargo Escorting......Page 418
12.1 Transparency International Rankings......Page 424
12.2 Applying Peer Pressure......Page 431
12.3 The Pinochet Case......Page 432
12.4 The Abacha Case......Page 434
12.5 Anticorruption Reform in Hungary......Page 444
12.6 UN Oil-for-Food Program in Iraq......Page 446
2.1 The Value Chain and Corruption Vulnerabilities in the Education Sector......Page 102
2.1 Estimated Direct Costs of Teacher Absenteeism, Selected Countries......Page 104
3.1 Deforestation versus Control of Corruption......Page 125
4.1 A General Framework for the Implementation Process......Page 171
4.2 A General Framework for Controlling Corruption in the Electricity Sector......Page 173
5.1 State Capture versus Administrative Corruption in the Road Sector......Page 196
7.1 Corruption, Water Reform, Gross National Income per Capita, and Access to Water......Page 258
7.2 The Spectrum of Utility and Nonutility Water Providers......Page 262
8.1 Perception of Corruption and Quality of PFM......Page 303
8.2 The Budget Cycle......Page 304
8.3 Analyzing PFM along the Four Dimensions, Selected Countries......Page 312
8.4 External Stakeholder Participation and Perception of Corruption......Page 315
8.5 Assessing PFM Performance in Ghana......Page 321
9.1 Common Kickback Scheme......Page 338
10.1 The NIP......Page 381
10.2 Tax Collections by Type of Taxes......Page 384
10.3 Corruption Risk Map of VAT Refunds Procedure before the Reform......Page 386
10.4 Gold Sticks Operation......Page 389
10.5 The Corruption Chain in VAT Refunds......Page 390
10.6 Corruption Risk Map of VAT Refund Procedure after the Reform......Page 391
10.8 Exports and VAT......Page 394
10.9 VAT Refunds as a Percentage of VAT Collections......Page 395
11.1 Customs Performance in Selected Russian Regions, 2004......Page 417
12.1 Money-Laundering Cycle......Page 428
12.2 Not a Simple “Laundromat”: Money Laundering in a Broader Framework......Page 442
1.1 Key Decision Points and Related Processes in the Drug Sector that May Be Vulnerable to Corruption......Page 69
1.2 Selected Strategies to Mitigate Corruption in Pharmaceutical Systems......Page 92
2.2 Some Correlates of Teacher Absenteeism in Bangladesh, Ecuador, India, Indonesia, Papua New Guinea, Peru, and Zambia......Page 110
3.1 Campaign Contributions in the United States, by Sector, 2000......Page 131
3.2 Supply Value Chain and Corruption Vulnerabilities......Page 133
4.1 A Comparison of the Human Development Index (HDI) and the Corruption Perception Index (CPI)......Page 155
4.2 Vulnerability to Corruption: Government Policies......Page 157
4.3 Vulnerability to Corruption: Different Stages of Project Development......Page 158
4.4 Vulnerability to Corruption: Customer-Interfacing Activities......Page 160
4.5 Vulnerability to Corruption: Theft of Electricity......Page 161
4.6 Five Key Elements of an Anticorruption Strategy......Page 172
5.1 Types of Corrupt Activity Prevalent in the Transport Sector......Page 197
5.2 Remedial Framework and Menu of Response Options......Page 207
5.3 Elements of a Remedial Anticorruption Strategy......Page 211
6.1 Petroleum-Rich Developing Countries......Page 227
6.2 Oil and Perceptions of Corruption, 2006......Page 228
6.3 Petroleum Sector Corruption: Summary Table......Page 248
7.1 Value Chain Framework: Corrupt Interactions in the Water Sector......Page 264
7.2 Key Public Actors Involved in the WSS Sector......Page 266
7.3 Tackling Hotspots in Public-to-Public Corruption......Page 276
7.4 Tackling Hotspots in Public-to-Private Corruption......Page 278
7.5 Tackling Hotspots in Public-to-Consumer/Civil Society Corruption......Page 284
7.6 Next Steps......Page 288
8.1 PFM System Weaknesses and Patterns of Administrative Corruption......Page 308
8.2 PFM Roles and Anticorruption......Page 311
9.1 Discretion and Corruption in Bid Rigging......Page 341
10.1 Typology of Tax Evasion and Corruption......Page 375
10.2 Factors Affecting the Behavior of Stakeholders and Patrimonial Networks in Corruption......Page 376
10.3 Risks and Remedies in Principal Processes in Tax Administration......Page 378
10.4 Risks and Remedies in the VAT Refund Process after the Reform......Page 392
11.1 A Customs Risk Map......Page 408
11.2 Measures Addressing Motive and Opportunities for Corruption in Customs Agencies......Page 409