LATIN AMERICA - Corruption Accentuates Economic and Social Crises

www.oneworld.net Marcela Valente

BUENOS AIRES, Jan 22 (IPS) - Rampant corruption is increasingly undermining the credibility of democracy and politics in Latin America, although some countries have made progress against the scourge, Transparency International (TI) stated in its latest report, released Wednesday.

The Global Corruption Report 2003 by the Berlin-based international anti-corruption network warned that like last year, respondents to surveys and polls continue to ''view South America as one of the most -- if not the most -- corruption-plagued regions in the world.''

Nor have Central America, Mexico or the Caribbean made much headway against the corrupt, which has led to a deepening lack of public confidence in democracy and the political system, said TI.

But on a more upbeat tone, the report stated that ''The corrupt are running out of places to hide from courageous whistleblowers and journalists'' in today's world, due to a more effective press, quicker and more fluent information flows, and the determined action of civil society organizations.

The report's chapter on South America indicated that the region ''has been racked in recent months by economic crisis, social unrest and popular rejection of the region's political leaders.

''The persistent scourge of corruption in South America has nourished the roots of this discontent'' and ''graft has contributed to the (region's) economic problems,'' it added.

Continuous corruption scandals, in the midst of economic crisis, have eroded the credibility of the region's institutions and the already fragile public confidence in the political system, said the study, which is based on surveys and polls carried out in the region.

One of the surveys cited, conducted by the Inter-American Development Bank, found that public dissatisfaction with economic reforms in the region was growing, particularly among the middle class, and that only one out of two respondents said they believed democracy was the best form of government.

But despite the disenchantment with democracy, TI reported that there have been advances in the fight against corruption in the region, due to efforts by governments, civil society, and especially the press, in spite of the intimidation and aggression of which journalists are often the targets.

The Global Corruption Report 2003 also noted that multilateral financial institutions and donors have become more cautious about providing funds to governments under suspicion of corruption, and have been earmarking more funds to programs that emphasize government transparency.

The Organization of American States (OAS) began to monitor compliance with the Inter-American Convention against Corruption last year, drawing up evaluation reports ''to pressure governments to change or improve aspects that analysts consider unsatisfactory.''

The South American regional chapter of the TI report underlined the efforts made by Peru, especially with respect to investigations into the case of Vladimiro Montesinos, ex-president Alberto Fujimori's (1990-2000) former intelligence chief.

Peruvian authorities arrested Montesinos in June 2001, and he is in jail facing 60 separate lawsuits. In addition, officials were able to recover part of the money deposited in Swiss bank accounts, the product of graft and other forms of corruption in which the network headed by Montesinos engaged.

TI observed that more than 240 investigations, involving over 1,300 people, were under way in Peru into acts of corruption committed during the ''Fujimori-Montesinos era.''

According to ''preliminary findings'', Fujimori -- who is living in Japan -- may have stolen more than 180 million dollars from the public coffers, said the report.

Nevertheless, the investigations have done little to restore Peruvian society's confidence in its leaders, said TI, which pointed out that ''surveys suggest that 75 percent of Peruvians believe that corruption will persist.''

That view may not be unfounded, to judge by accusations that have emerged against President Alejandro Toledo over the way he pushed through the privatization of public enterprises that he had pledged to keep in the hands of the state.

Elsewhere in South America, presidents, ex-presidents and high-level officials are implicated in investigations of corruption.

In Bolivia, officials of the government of the now-deceased Hugo Banzer (1997-2001) face probes and legal action, as do Paraguayan President Luis González Macchi and his predecessor Juan Carlos Wasmosy.

In Argentina, former president Carlos Menem (1989-1999) was held under house arrest for six months in 2001, on charges of illegal sales of arms and money laundering.

Menem is also facing legal proceedings initiated last year for allegedly accepting a 10 million dollar pay-off from the government of Iran to conceal its role in the July 1994 bombing of a Jewish community and medical center in Buenos Aires, in which 87 people were killed.

Domingo Cavallo, who served as economy minister under both Menem and Fernando de la Rúa (1999-2001), was also arrested in 2002 in connection with the same illegal arms sale scandal.

But the TI report referred to advances in the fight against corruption launched by president Fernando Henrique Cardoso (1994- 2002) in Brazil.

It warned, however, that most of the Brazilians polled believed corruption was on the rise, a perception that was largely based on accusations of fraud that forced Roseana Sarney from withdrawing as a candidate in the October presidential elections, which were won by Luiz Inácio Lula da Silva.

Colombia, meanwhile, ''where a brutal war continues to claim the lives of some 3,500 civilians a year...has suffered the tragic consequences of endemic theft by politicians and public officials for decades,'' said TI.

It pointed out that a World Bank survey released in February 2002 found that ''bribes are paid in 50 percent of all state contracts.''

And while a number of anti-corruption initiatives have been seen in Central America, the Caribbean and Mexico, they have brought few results, according to the chapter on that area.

One consequence of fruitless attempts to crack down on corruption and of the broad use of the issue as part of campaign platforms is ''the weakening of people's trust in a democratic regime and in the system of political parties,'' said the report.

TI underlined that Central America ''continues to exhibit asymmetries in corruption.'' While scandals have been ''relatively infrequent in some countries, such as Costa Rica,'' graft has increased in countries like Guatemala, Haiti, Honduras, Nicaragua, Panama and Puerto Rico.

But in Mexico, ''important advances'' have been made thanks to the anti-corruption measures adopted by the government of Vicente Fox, according to the report.

Former presidents in Central America are also facing legal proceedings, while presidential candidates who ran on anti- corruption platforms often become the focus of scandals and allegations of the misuse of campaign funds.

On the list of former presidents facing corruption charges are Rafael Callejas of Honduras (1990-1994), Leonel Fernández of the Dominican Republic (1996-2000), and Oscar Alemán of Nicaragua (1997-2002). TI lamented that their successors have not done much to set themselves apart from that trend.