Bulgaria Pays the Price of Corruption

23 07 2008

Corruption in Bulgaria has led to the suspension of EU aid worth approximately 500m Euros. Announcing the decision Commission spokesman Johannes Laitenberger said the EU was also withdrawing the right of two Bulgarian agencies to manage EU funds.

Bulgaria’s PM admitted his country had not done enough to meet EU standards.  In Bulgaria, “the fight against high-level corruption and organised crime is not producing enough results,” Mr Laitenberger said.

One of the series of reports published on Wednesday condemns “a lack of commitment to act swiftly and decisively when fraud is identified”, and refers to “a strong suspicion of the involvement of organised crime”.

Romania was also criticised for shortcomings in its judiciary, including politicisation of cases. The country will escape penalties for now, but its report says the reforms remain “fragile”.

The report on Romania condemns parliament for delaying corruption inquiries involving the former Prime Minister Adrian Nastase and other top officials. 

While praising the “consistently good record” of Romanian prosecutors, the European Commission notes that in 90% of corruption cases, lenient judges deliver the minimum penalty.

Jacki Davis from the European Policy Centre in Brussels says there is a clear message to Bulgaria and Romania, but also for EU candidates, from Croatia to Turkey.

“Negotiating the terms of your EU membership isn’t the end of the story. If you make promises, you have to live up to them. So it’s shape up or face sanctions,” she says.

This is indeed a turning point in the EC´s attitude to Corruption. For decades it has been accused of ignoring the problem. The change should act as a wake-up call to any recipients of EU funding.

We hope and believe that this may also be a sign of a broader change of attitude towards corruption. Other indicators include an increasing number of companies adopting self regulation policies and codes of conduct, and increasing shareholder pressure for such policies.

Governments that are recipients of aid should certainly hear the alarm bells ringing and make a concerted effort to speed up anti-corruption reforms. But, all countries seeking foreign investment should also wake up to the fact that they stand to loose billions of investment if they do not reform to meet the growing demands of large corporations and investment funds.

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