Chapter 12 Conclusion: Good Governance and Sustainable Development

Chapter 12

Conclusion: Good Governance and Sustainable Development

M. A. B. Siddique and R. N. Ghosh

I

Readers of this volume will have noticed that it is divided into three Parts: Part 1 deals with general and theoretical topics, with a bearing on the main theme of the book, viz. “Crime, Corruption and Economic Development”; Part 2 deals with specific case studies, with the primary focus on three countries, viz. Indonesia, India and Bangladesh. Part 3 relates to the present concluding section, in which the two editors try to sum up the contributions of the authors in this volume.

As was stated earlier, the papers included in the volume were previously presented in two international conferences, one held in Perth, Western Australia, in June, 2009, and then, in a follow-up conference, held in India (Kolkata) in December, 2009. The two conferences included papers from a wide range of areas by people with different types of skills and expertise: academics, senior government officials and senior officials from the Police in India. The selected papers included in this volume look at corruption, not only from different angles but also from the varying perspectives of different countries and cultures.

II

After the introductory comments (Chapter 1) made by the two editors, they get involved in Chapter 2 to discuss the meaning of corruption and its various quantitative as well as qualitative measurements which are currently available in the literature. Robin Ghosh and Abu Siddique seek to explain why the current UNDP definition of corruption fails to be inclusive of the various shades of corruption. Limitations include that it only provides a qualitative measure and fails to provide a quantitative measure. Moreover, it does not provide a distinction between “grand” and “petty” corruption. “Petty” corruption is a way of life in many developing countries and has been in existence for centuries. Furthermore, in contrast to the UNDP definition, it is argued that corruption does not have to be associated with “public power, office or authority”. The paper then goes on to discuss various quantitative measures of corruption. This paper sparked lively discussions in the Conference. Andrew Williams, an author of another paper included in this volume, raised a very valid issue of the composition of these indices and how their use may lead to fallacious research outcomes. This then led to a lively discussion of the paucity of data in the study of corruption, and the non-standard reporting practices.

In a very interesting paper (Chapter 3), Andrew Williams, discusses how the absence of willingness (or otherwise) of governments to release information of economic and social data can be used as an indicator for the degree of political and institutional transparency. In light of this, Andrew Williams discusses an index (which he has himself developed) that has extensive coverage of countries as well as time and is based on the quantity of reported socio-economic data contained in the World Development Indicators and the International Finance Statistics databases. Using this index, Andrew Williams discusses several case studies that highlight the importance of transparency in economic development.

A final chapter in Part 1, is the paper contributed by Dora Marinova, Vladislav Todorov and Amzad Hossain. In Chapter 4, the three authors ask the question, what is meant by good governance? They argue that in the West, good governance is treated as synonymous with secular democracy. However, they go on to argue that a long-term sustainable development cannot take place without regard to our environment.

Moreover, a country needs to tap the latent spirituality and morality of the people to promote good governance. Finally, the authors note that the present system of Western democracy is far removed from the people’s will and should be more ‘deliberative’ than it is.

III

Part 2 of this volume deals with specific case studies to examine whether, if a region, or a country falls into the trap of crime and corruption, it would face stagnation or decline in its economy.

In a very interesting paper (Chapter 5), Derek Aldcroft examines the extent of corruption in one of the poorest economic performers in the world — the African Continent, especially sub-Saharan Africa. Despite the high hopes of the post-colonization period, many African countries failed to achieve any significant economic growth; and by the end of the 20th century, per capita real incomes had not improved, and in some cases had actually worsened. It is now generally agreed that the main reason for this failure lies in the inability of many African countries to efficiently manage their resources, including manpower; in other words, lack of good governance. The consequences of economic stagnation and decline were extreme, with two-thirds of the population in many African countries living at subsistence or below the absolute poverty line by the turn of the last century. The paper focuses on Africa’s weakness in political systems, bureaucracies, administrative organizations and property and legal rights. It is argued that the majority of African counties have failed to achieve economic growth and development because of a deficiency in the social and political structures of these countries.

Abu Siddique’s paper “Corruption in Bangladesh: Review and analysis” (Chapter 6) examines the concept and various quantitative measures of corruption. Corruption is understood by the majority to be harmful to a country although the reason why it is, is rarely understood. For this reason, economists have endeavored to determine the causes and consequences of corruption. In light of this, the paper goes into a deeper analysis of the magnitude of corruption in Bangladesh and looks at the effectiveness of the anti-corruption agencies within the country. The paper describes the causes of corruption, with particular emphasis on banking,

customs and telecommunications sectors. The consequences of corruption on economic growth are then discussed. Possible remedies for corruption for Bangladesh are also suggested in the paper.

In his provocative paper (Chapter 7), Gautam Chakrabarti, who was then (2009) the Commissioner of Police in Kolkata, discusses the widespread levels of corruption in India since WWII. Pre-WWII corruption in India was generally confined to a limited number of government departments, but with large sums of money being spent during WWII, corruption rapidly spread to all sectors. During the 1960s the Government of India set up anti-corruption agencies, however as the then Commissioner of Police in Kolkata argues that there is a large gap between policy and practice in India. Despite experiencing rapid economic growth in more recent years, India’s ranking remains low in the Global Corruption Index. Recently, the Government of India has put in further measures, including the RTI Act 2005 and the WHISTLEBLOWER Resolution. Several recent reports conducted by the government suggest that there are regional variations in the level and impact of corruption. In his paper, Gautam Chakrabarti investigates these variations.

Surajit Kar Purkayastha, presently Commissioner of Police in Kolkata, has contributed the paper in Chapter 8. He attempts to examine the extent of criminal activities in India in the context of the economic progress of the country. Surajit Kar Purkayastha conducts a sample survey with 30 specific questions that relate to corruption. The questionnaire survey covered a cross-section of people. This paper presents and analyses the data obtained from the survey. In particular, the author finds that there seems to be no disagreement among the public about their perception of the role of politicians, about the accountability of the richer sections of the society, and about the inadequate implementation of existing anticorruption laws, along with an overwhelming concern over the state of corruption in the country. The author uses the survey results along with the study of the Corruption Perception Index to reach conclusions on the extent of corruption within India.

Rimawan Pradiptyo’s paper “A Certain Uncertainty: An Assessment of Court Decisions in Tackling Corruption in Indonesia” appears as Chapter 9. In this brilliant and original paper, Pradiptyo assesses court decisions made on cases of corruption in Indonesia. In 1999, the

Anti-Corruption Bill was ratified in Indonesia, and then it was modified in 2001. Rimawan argues that despite a clear legislative guidance on the extent of punishments to be given for each type of corruption, the sentences handed by the judiciary in Indonesia are inconsistent with legislation. Using a regression analysis he finds that the harshness of sentences in Indonesia depends on the occupation of offenders. It is also found that there is a discrepancy in the level of economic losses caused by corruption (US$21.2 billion) and the total financial punishment imposed by courts (US$2.6 billion). The data in Pradiptyo’s paper confirms that most incidents of corruption are committed by people earning a medium to high income. The author argues that the total burden of financial punishment should be sufficient to compensate for the social costs of corruption.

In another major paper, dealing with Indonesia (Chapter 10), Budi Setiyono describes the inconsistency between the smooth democratization process, following the end of the authoritarian regime and the extent of corruption within Indonesia. He points to the fact that since the democratization process began, Indonesia’s Corruption Perception Index has not improved significantly. As a result of widespread corruption in public offices the quality of public services has become extremely poor in Indonesia. Budi Setiyono, then, goes on to describe the large number of inconsistencies that the State Auditing Agency finds in almost every government office. The paper attempts to explain why reform in a newly emerging democratic country like Indonesia is not enough to decrease the level of corruption. Setinyono argues that when Suharto was removed from office on charges of corruption there were still left hundreds of little Suhartos in Indonesia.

In the final chapter in Part 2 (Chapter 11), Amzad Hossain and Dora Marinova observe the rising degradation of natural resources, water crises, widening gap between the rich and the poor, corruption, crimes and gender issues due to mal-governance in Bangladesh. The paper looks at the need for governance within the cultural and human context of the country to address these unstable situations. The two authors outline several aspects which they believe if improved, can help progress Bangladesh towards achieving better governance in terms of socio-economic and environmental systems. The paper suggests that if the Bangladeshis look to their cultural values the country, they can perhaps achieve good

governance. Conference delegates were impressed by the very Confucian ideas offered by the authors of the paper’s and agreed that perhaps the best way to eradicate some types of corruption is to return to strict Confucian moral values.

IV

Careful readers will notice that the different papers contained in this volume look at the concepts of crime, corruption and economic growth with differing perspectives. Whether crime and corruption would retard economic growth is an open question. One of the factors that would be apparent is that every individual incident of corruption, whether ‘petty’ or ‘grand’, is unique in its nature, despite broad similarities with other incidents. Hence a general policy of anti-corruption that would work universally, is unlikely to be formulated in practice. Each country (and every region) has to work out if a certain type of anti-corruption policy has any relevance to it. What is good for India may not be good for Bangladesh and Indonesia. Even within the same country, it is possible that a single anti-corruption policy might fail to achieve its objectives.

However, in a final analysis, good governance involving an efficient and transparent use and management of resources, together with an honest bureaucracy, would be the only solution to the twin problems of crime and corruption. Such objective may not be achieved through legislation. However, all countries should set up a long-term goal to achieve good governance by way of a transparent and efficient management of the economy and environment. Paradoxically, while it is possible that crime and corruption of a wide ranging nature could inhibit economic development, it might be argued that economic development would itself ensure good governance over a very long-term.