When does corruption become a regional issue?

Corruption undermines economic performance and development, rule of law, democracy and causes social disorder. Development, integrity and security are inextricably linked. A more secure region is only possible if poor countries are given a real chance to develop. No state, no matter how powerful, can by its own efforts alone make itself invulnerable to today’s threats. Every state requires the cooperation of other states to make itself secure.

The prevalence of corruption is the direct cause of pervasive poverty in our region. Some may contend that poverty is the cause of corruption. I hold a contrary view. I come from a country richly endowed with natural resources, yet the majority of our people live in abject poverty. Corruption is the direct cause of poverty in my country and the same goes for many Pacific island countries. The failure to meet most of the Millennium Development Goals (MDGs) is a testament to that.

The excess effects of corrut to that.

The excess effects of corruption does spread beyond the borders. They take the form of refugees, money laundering and other illicit activities. The digital world has changed the dynamics of the world map so that today, transactions can be conducted at the click of a keyboard or the tap of an iPhone. Our jurisdictional differences are becoming less of a barrier for those wishing to conduct illicit financial transactions.

Pacific islands governments are plagued by corruption scandals

Today, we are witnessing a growing trend, though not uncommon, whereby those in power use that power to enrich themselves and their cronies at the expense of the people. And when the anti-corruption institutions hold them to account, they refuse to submit. They use their powers and state resources to subjugate anti-corruption measures and avoid scrutiny. Most recently some of the most telling examples of threats to the rule of law, democracy, security and prosperity in our region include:

• The extraordinary efforts to obliterate anti-corruption forces to protect one person in Papua New Guinea;
• The acting President of Vanuatu pardoning himself and 13 other members of parliament after being convicted of bribery, even when the matter is pending sentencing; and
• The bribery scandal involving the Nauruan prime minister, his justice minister and an Australian phosphate company and the alleged actions by the Nauru Government to terminate the visa of the Chief Justice.

We have seen examples of how corruption transcends national borders, for example:

• The forgotten case of Australian companies and advisors implicated in diverting K100 million of PNG Motor Vehicle Insurance Ltd funds;
• The revelations by Australian authorities that at least AUD200 million of PNG corruption proceeds are laundered or invested in Australia every year;
• The recent findings of the Financial Action Task-Force that Australia is becoming a hotspot destination for property investment using illicit funds, mostly coming from Asia-Pacific countries;
• The recent revelations by SBS Dateline program of how Australian lawyers are involved in laundering corruption proceeds into Australia; and
• The recent revelations by Sydney Morning Herald of an Australian oil company, the Australian branch of an international bank and Australian lawyers involved in structuring a predatory loan arrangement.

Many of these examples have highlighted how the people who have been exposed in these corruption scandals have no trouble transferring and living off their ill-gotten gains. With access to Australia, for example, many have access to quality health care and education whilst at home the robbed majority continue to suffer in abysmal conditions.

In saying this, I am also conscious of the fact that in most developing countries, apart from simple survival corruption, most of the high-level corruption are facilitated by and benefit those in power. If corruption-free and good governance are the values and standards we want to see reflected in our neighbourhood, we should live for and fight for their worth. Although it may come at a price. Few may not like it, but the victimised majority will appreciate our efforts. Based on my personal experience, I can vouch for this.

Australia, as member of the G20 and the OECD among others, has obligations under various international treaties, memberships and agreements. Most countries in the Pacific have adopted the UN Convention against Corruption (UNCAC). While progress has been made to establish an APEC Network of Anti-Corruption Authorities and Law Enforcement Agencies, I am unaware of a regional framework in the Pacific Islands Forum to combat corruption and money laundering. Perhaps that may be an agenda for the next forum leaders discussions?

So the question is, when does corruption in one country really become a matter for regional leaders?

One can trumpet the robustness of its own domestic mechanisms but if that ‘robust’ system is not detecting and combating corruption and money laundering more widely, then that system is a problem in itself. Or is it just a case of lacking political will to act?

This is an extract of Mr. Sam Koim’s presentation to the Voices for Justice conference held at Parliament House, Canberra on 13 October 2015.

This article was written by
Sam Koim

Sam Koim is Chairman of the anti-corruption body Investigation Taskforce Sweep, Papua New Guinea.