The EU likes to portray itself as a good and modern place to do business, despite the hiccups of the euro crisis and other distractions. Between this self-image and reality nevertheless lies a gap, and nowhere is this more evident than in spread of corruption around the continent. ---
If almost three quarters of businesses report widespread corruption, then surely this must be a serious issue, even though it is not one that receives much coverage. What is even more striking are the large differences in perceptions of corruption across Europe.
In Italy, 98 per cent of respondents reported widespread corruption, but only 11 per cent of Danish companies did. Italy and Denmark are the two extreme points in this survey around which other countries cluster.
The most corrupt places are in Italy’s loose geographic proximity. Spain (93 per cent), Greece (96 per cent), Romania (95 per cent) and Bulgaria (91 per cent) are all Southern European countries. Meanwhile, the least corrupt places such as Sweden (43 per cent), Finland (31 per cent), Britain (41 per cent) and maybe even Germany (though at 51 per cent perceived corruption) are all in central and northern Europe. ---
It is worth pointing out that corruption does not always mean bribes and kickbacks. In fact, these were ranked relatively low as the most common occurrences of corruption. Far more prevalent are favouring friends and family members in business, tax fraud and funding political parties in exchange for influence of public contracts.
Perhaps least surprising in the Eurobarometer results is the sector-by-sector analysis. By far the sector most affected by corruption is construction and building, in which 49 per cent of respondents across the EU said corruption was a problem for doing business. This was followed by engineering, electronics and motor vehicles (39 per cent) and financial services, banking and investment (35 per cent).
Another result of the survey which should be embarrassing for the EU is the anticipation of criminal sanctions. Almost two thirds of companies (62 per cent) stated that they would find it unlikely that corrupt people or businesses would be imprisoned or heavily fined. In fact, only 41 per cent believe that such people or businesses would even get caught.
The picture that emerges from this latest Eurobarometer survey is an unsettling one. It shows how the rule of law and clean business practices are not nearly as strong in Europe as one might have expected. After all, most EU member states are mature, developed economies with reasonably functional legal systems. We would instinctively expect them to score much better in corruption surveys.
Yet only in a handful of these countries does corruption seem to be under control (and practically all of them are Scandinavian).
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