Saturday, February 8, 2014

The extent of corruption in Europe is "breathtaking" and it costs the EU economy at least 120bn euros (£99bn) annually, the European Commission says.   EU Home Affairs Commissioner Cecilia Malmstroem has presented a full report on the problem.   She said the true cost of corruption was "probably much higher" than 120bn.  Three-quarters of Europeans surveyed for the Commission study said that corruption was widespread, and more than half said the level had increased.   "The extent of the problem in Europe is breathtaking, although Sweden is among the countries with the least problems," Ms Malmstroem wrote in Sweden's Goeteborgs-Posten daily.   The cost to the EU economy is equivalent to the bloc's annual budget.  For the report the Commission studied corruption in all 28 EU member states. The Commission says it is the first time it has done such a survey.
Bribery widespread  - National governments, rather than EU institutions, are chiefly responsible for fighting corruption in the EU. But Ms Malmstroem said national governments and the European Parliament had asked the Commission to carry out the EU-wide study. The Commission drafts EU laws and enforces compliance with EU treaties.
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In the UK only five people out of 1,115 - less than 1% - said they had been expected to pay a bribe. It was "the best result in all Europe", the report said.
The political commitment to really root out corruption seems to be missing” End Quote Cecilia Malmstroem EU Home Affairs Commissioner . But 64% of British respondents said they believed corruption to be widespread in the UK, while the EU average was 74% on that question.  In some countries there was a relatively high number reporting personal experience of bribery.
In Croatia, the Czech Republic, Lithuania, Bulgaria, Romania and Greece, between 6% and 29% of respondents said they had been asked for a bribe, or had been expected to pay one, in the past 12 months.
There were also high levels of bribery in Poland (15%), Slovakia (14%) and Hungary (13%), where the most prevalent instances were in healthcare.
Ms Malmstroem said corruption was eroding trust in democracy and draining resources from the legal economy.
This report has not been without controversy. Its release was delayed for months, and some countries were critical of the European Commission for interfering in areas which they believed were none of its business.
Originally, the report was also supposed to have included a chapter assessing corruption within EU institutions as well as within member states. But that idea was dropped.
Nevertheless the figures revealed will certainly raise some eyebrows - Cecilia Malmstroem described the scale of the problem as breath-taking.
The commission's estimate that corruption is costing the EU economy about 120bn euros - the size of the EU's annual budget - could well be a conservative one. Other experts believe the real figure is probably higher.
One thing is clear though - a continent that is trying to put years of economic crisis behind it needs to do a better job in combating corruption.

"The political commitment to really root out corruption seems to be missing," she complained.
The EU has an anti-fraud agency, Olaf, which focuses on fraud and corruption affecting the EU budget, but it has limited resources. In 2011 its budget was just 23.5m euros.
The Commission highlighted that:
Public procurement (public bodies buying goods and services) forms about one-fifth of the EU's total output (GDP) and is vulnerable to corruption, so better controls and integrity standards are needed
  • Corruption risks are generally greater at local and regional level
  • Many shortcomings remain in financing of political parties - often codes of conduct are not tough enough
  • Often the existing rules on conflicts of interest are inadequately enforced
  • The quality of corruption investigations varies widely across the EU

12 comments:

Anonymous said...

Turkish riot police have fired water cannon and tear gas at hundreds of demonstrators marching in Istanbul in protest at new laws tightening government control of the internet.

Demonstrators threw fireworks and stones at police cordoning off Taksim Square, the city's main square.

The president is under pressure not to ratify the legislation.

It includes powers allowing authorities to block websites for privacy violations without a court decision.

The opposition says it is part of a government attempt to stifle a corruption scandal.

Prime Minister Recep Tayyip Erdogan has denied accusations of censorship, saying the legislation would make the internet "more safe and free".

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector

Anonymous said...



steve_from_virginia
• 6 days ago








When Chu says this, "One of the reasons why the situation in China has been so stable up to this point is that unlike many emerging markets there is very, very little reliance on foreign funding," she means that China has not received the sorts of hot-money investment/carry trade flows that have overtaken other countries.

However, China is absolutely dependent on very large foreign currency flows that derive from sale of manufactured goods. This is the reason behind China's large forex reserves. China does not produce dollars, euros, yen or sterling, it imports them. China uses these currency holdings as collateral for RMB lending, in effect doubling its money supply. The country's problem is similar to Japan's: a declining trade surplus => less forex collateral => increase in RMB unsecured lending and excess leverage in finance sector