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Business bribery is rife: report

Business bribery is rife: report

Cambodia has again ranked as one of the most corrupt countries in the world with the release of global anti-bribery association TRACE’s bribery risk index.

According to the index, titled the TRACE Matrix and released on November 11, Cambodia is the fifth most at risk country for business bribery out of 197 countries. The Kingdom ranked better than only Nigeria, Yemen, Angola and Uzbekistan.

Vietnam was the only other Southeast Asian nation in TRACE’s top 10 most at risk nations of business bribery.

Based on development partner, RAND Corporation’s Business Bribery Risk Assessment, the index defined business bribery as anyone paying, offering, promising or authorising payment to influence any act or decision of foreign officials or to gain an improper advantage in doing business.

Measured on a scale of one to 100 – 100 meaning high risk – the Kingdom posted scores of 98 in civil service transparency, 84 in business interactions with government, and 77 in society (including media) oversight.

“Cambodia scores 84 on this measure, indicating very high risk of intensive interaction with the government, very high regulatory burden, and a very high expectation of bribes,” TRACE’s Cambodia analysis says regarding private sector interactions with government.

“Cambodia’s score of 98 indicates a very low quality of administration and governmental transparency,” it continues.

Overall, the Kingdom received a weighted average business bribery risk score of 89.

“We have heard from the business community for years that a tailored tool to gauge levels of commercial bribery was needed,” Alexandra Wrage, President of TRACE, was quoted saying in a November 11 statement.

“There are some excellent indices currently available, but these are either very broad, measuring perceived corruption across all spheres of society, or very narrow, measuring just one factor.”

TRACE’s findings are aimed at providing businesses with an accurate measure to gauge the risk of corrupt activities and avoid violating anti-corruption laws.

The index also aims to provide a more detailed alternative indexes such as Transparency International’s (TI) Corruption Perceptions Index (CPI).

Business individuals interviewed for RAND’s Business Bribery Risk Assessment cited the absence of indicators pertaining to the number of business interactions with government officials as one of the CPI’s flaws.

Preap Kol, executive director at TI Cambodia, said while there is no such indicator present in the annually released CPI, the global anti-corruption body does consider the number of business interactions with government officials within its Bribe Payers Index.

TI’s Bribe Payer’s Index surveys only the world’s 28 wealthiest economies and is published every three years – the last being in 2011.

“You need the right tool to measure the right context,” Kol said.

“One thing the CPI guarantees is there must be at least three data sources from three different credible sources. In the case of Cambodia, there were seven including the World Bank, World Economic Forum and Global Impact.”

Cambodia’s ranking on TI’s CPI fell three places from 157th position in 2012 to 160th in 2013. Kol said the Kingdom’s normalised political arena could improve its CPI ranking in the 2014 index.

The 2014 CPI is due out on December 3.

“Investors from European and Western countries do look at these indicators because each country has rules and regulations that prohibits them from paying bribes, but it does not mean they have to make a decision only based on the CPI,” Kol said.

Kol welcomed TRACE’s new bribery index saying that there is an ever growing demand from businesses to access risk analyses especially in emerging markets.

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