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Myanmar enters mortal combat against corruption

Myanmar enters mortal combat against corruption

TUESDAY, September 09, 2014

The country's new anti-graft watchdog faces a formidable foe

On February 25, President Thein Sein’s government launched the Anti-Corruption Commission of Myanmar (ACC), comprising several former high-ranking military personnel and aided by technical know-how from the UN. The commission has 15 members, five nominated by Thein Sein and the remainder by the lower and upper Houses of parliament. 
While the presence of former military officials has triggered fears that the anti-graft watchdog will have few teeth, its launch is a significant development after more than five decades in which the country had no anti-corruption institution, strategy or policy. Needless to say, no authoritarian leader anywhere willingly enters into a war against corruption without pressure from outside and policy input from global players.
 But the challenge ahead in Myanmar is huge. It begins with defining what constitutes corruption in a nation that has been obsessed with countless allegations of graft since it regained its independence in 1948, and especially since the pro-democracy uprising and junta crackdown in 1988.
As such, it is not yet clear what the precise targets of the new anti-graft commission will be. The World Bank and Transparency International define corruption as “abuse of public power for private gain”. Aung San Suu Kyi takes a slightly different angle: “It is not power that corrupts but fear. Fear of losing power corrupts those who wield it and fear of the scourge of power corrupts those who are subject to it” (“Freedom From Fear”, 1991). 
Whatever the theoretical framework, Myanmar’s ACC needs to outline a practical classification of corruption and lead an offensive against the practice so as to gain the confidence of both domestic and international investors.     
The legal system currently has three defences – the Penal Code (1861), the Suppression of Corruption Act (1948) and the Anti-Corruption Law (2013). These were designed to protect the people from corrupt public servants rather than other categories of graft. The fact is that corruption in Myanmar correlates precisely with the quality of governance. Declining quality of governance has brought a skyrocketing of corruption since 1988. Corruption indicators in the market act as an early warning system and are scaring off investors and economic agents. Few ethical businesses are willing to risk investing in the corrupt economy. The exception is mining firms, as they enjoy advantages such as economies of scale over their Myanmar counterparts. 
To reduce corruption in the country, the people of Myanmar need to offer their military an exit from involvement in the economy and the polity. An increase in the quality of governance will lead to a precisely correlating decrease in corruption. 
But part of the solution lies in creating a robust ACC – a few evidence-based solutions are described below.
Five steps
_ First, to genuinely combat corruption, the commissioners of Myanmar’s ACC must prioritise a strategic anti-corruption policy for the people, not the other way around. Without people participation in the policy-making and decision-making of anti-corruption reform, the ACC cannot be expected to achieve its goals. In order to gain public and investor confidence, the ACC needs to work with multilateral agencies and global banks to recover the assets or seize the public money stolen by former junta generals, particularly ex-dictator Than Shwe and his family. The ACC should apply Article (17) and Article (23) of the UN Convention Against Corruption so as to submit a “freeze” order to the United Nations, World Bank and other agencies in order to recover public assets and money. Technical knowledge should also be sought from the International Centre for Asset Recovery and the World Bank’s Asset Recovery Watch.
_ Second, with the economy now under a free market-oriented policy and entering into digitalised trade and the world economic order, outside global factors are gradually shaping the political, economic and legal structure of Myanmar. As such, the private sector, aid agencies, foreign diplomats and transnational actors all have a role to play in controlling graft in the country. While a significant number of Myanmar citizens live on less than US$1.50 (Bt48) a day, countless former and current military generals are millionaires. As much of that ill-gotten wealth as possible must be returned to the public coffers from whence it was taken. To do so, Myanmar lawmakers could use modified forms of three laws already on the books in other countries – the US’s Foreign Corrupt Practices Act (1977), the UK’s Bribery Act (2010), and Switzerland’s Restitution of Assets of Politically Exposed Persons obtained by Unlawful Means Act (2011).
_ Third, Myanmar’s ACC should operate jointly with its equivalents in Singapore (the CIPB) and Thailand (NACC) as they have been tackling corruption for many decades. Selecting corruption crusaders and building the capacity of Myanmar’s anti-graft body has to be a merit-based process that focuses on professional ability rather than the nepotism and cronyism of the past. The ACC also has to design its mission and vision along the lines of either a single investigative commission, or multiple prevention-and-education model. 
My suggestion is that the commission should have four mandates: investigation, prevention, education and policy coordination.
_ Fourth, systems of public financial management (PFM) and national integrity of Myanmar need innovations. A freedom of information law ought to be put in place to give ordinary citizens the right to check the state’s financial assets, transparency and procurement reform. Activists and democratic politicians should encourage an open-budget policy in the country, after decades without a budget policy. In addition, to reduce incentives for corruption among business and industry, the commission should research ways of making the budget and tax system more transparent and accountable to the people. 
The majority of corruption in the public sector occurs as bribery of officials. Thus, the state processes of procurement, allocation of business licences and aid-transactions have to be standardised. The accounting system should also be modernised. In collaboration with the private sector and international agencies, Myanmar’s ACC could inculcate a professional business ethic among the commercial and trade community.
_ Finally, the success of Myanmar’s ACC ultimately depends on two things: the willingness to pay for the fight against corruption and smart leadership. Established anti-graft commissions in Singapore, Thailand and Hong Kong have gained nationwide credibility and respect by rooting out corruption in the society, polity and economy. Now, the ball is in the court of the Thein Sein’s administration. Whether Myanmar’s anti-corruption commission succeeds or fails depends on the president’s political will to pay for it, and his skill and capacity to regulate against graft.  
Naing Ko Ko is a PhD scholar at the Regulatory Institutions Network, College of Asia and the Pacific, Australian National University.