Countries will need to become more vigilant against corruption in order to attract long-term investment once the current financial crises has abated, said an anticorruption expert from PricewaterhouseCoopers (PwC).

PwC partner David Jansen called upon the nations to confront corruption and build or restructure their anticorruption systems to woo increased foreign direct investment, improve political stability, stimulate domestic growth and increase standards of living.

He was speaking in Kuwait at the 3rd annual conference of the Global Organisation of Parliamentarians Against Corruption (Gopac).

'After going through a period of extreme risk management, companies will look for new or perhaps previously-rejected business opportunities,' Jansen noted.
 
'They will have access to newly-rejuvenated credit markets and will take advantage of weakened competitors and realise strategic advantages,' he added.

According to him, these companies will make very significant investments in locations they believe will have favourable business conditions, which include effective and credible county-level anticorruption programs, laws and regulations.

'At the conclusion of the financial crisis, there will be fewer but stronger and larger multinational companies. For instance, it is predicted that six financial services companies will control 75 per cent of $14 trillion in US financial assets,' he opined.

These companies want business decisions and contract awards to be based on the fair, unbiased merits of business proposals and economics, and not to be unfairly influenced or arbitrarily decided in an environment of real or perceived corruption.'

Jansen spoke at the Gopac conference in his capacity as representative of the 'World Economic Forum Partnering Against Corruption Initiative,' where he sits on the anticorruption task force.

The conference was held under the auspices of Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, and attracted parliamentarians from a record 55 countries.

Jansen stated that it was impressive and commendable to see Kuwait and several Middle East countries seriously focus on the issue of corruption and its cost to the region's economic growth.

According to the 2008 report Confronting Corruption (www.pwc.com/anti-corruption) published by PricewaterhouseCoopers and the Economist Intelligence Unit, almost 45 per cent of senior global executives say they currently avoid certain markets or opportunities because of corruption risks; and almost 40 per cent say they have lost bids because of corrupt government officials.

Commenting from Washington, D.C., PwC anticorruption expert and Middle East specialist Glenn Ware stressed the need for improving country-level anticorruption systems.

'Over 100 countries have signed the United Nations Convention Against Corruption (UNCAC), and there will be some kind of independent review mechanism in the near future. Countries who fail to build an effective anticorruption system risk failing to attract foreign investment dollars, for which competition is increasing.'

Jansen suggested a three-step approach for governments and parliamentarians to improve country level anticorruption programs and ensure effective implementation of UNCAC:

Step 1 - Conduct a gap analysis between existing anticorruption architecture and Uncac rules and anticorruption best practices.

Step 2 - Work to develop an anticorruption plan covering four core areas - establishment of an independent anticorruption body charged with the creation of policies, procedures and controls; development of public financial disclosure rules, especially for revenues and expenses; create or enhance public procurement policies and practices based on transparency, competition and objectivity and implementation with legislative reform, criminalisation, enforcement and international co-operation.

Step 3 - Implement the anticorruption plan, focusing first on high risk sectors such as extractive industries.

Depending on the country involved, the implementation phase can range from the harmonisation and enhancement of existing anticorruption architecture to a need for wholesale implementation of new systems, Jansen said.

'Countries in the latter situation should not be discouraged or demoralised. There are many countries in this position that are being realistic about their situation and the length of time and amount of effort that will be required.  The big achievement is that they are moving forward,' he added.

Both Jansen and Ware, leaders of PwC's Governance & Anticorruption Services Group, lauded the longstanding efforts of organizations such as Transparency International and the World Economic Forum for progress in the fight against global corruption, estimated by The World Bank to exceed $1 trillion dollars annually.-TradeArabia News Service