17 November 1997

TEXTS: GLOBAL COALITION ON AFRICA TO HELP FIGHT CORRUPTION

(McNamara hails six nations who want to act now)  (1390)



WASHINGTON -- More and more African governments, like a growing number
of nations worldwide, are working to combat corruption and fight
bribery among their public officials.


Robert S. McNamara, co-chairman emeritus of the Global Coalition for
Africa, made that point November 12 at a Washington news conference in
which he publicly pledged the organization's strong support in helping
African governments combat corruption.


McNamara said the leaders of six African countries -- Malawi, Benin,
Tanzania, Uganda, Mali and Ethiopia -- have strongly expressed their
interest in combating corruption inside their governments. [Corruption
was the main item on the agenda at the annual meeting of the Global
Coalition for Africa in Maputo November 1-2].


Singling out Tanzania, McNamara praised that country's government for
establishing an anti-corruption body known as the Warioba Commission,
named after Justice Joseph S. Warioba, which investigated corruption
both inside and outside the government.


That body, McNamara told reporters, issued a report in December, 1996
which, according to McNamara, found that "corruption extends across
the entire society...." in Tanzania.


Reading from the report, McNamara said "'It is common knowledge that
the country's leadership is being involved in corruption. Stern action
must be taken urgently to clean up the leadership ranks in order to
restore respect and public confidence.... The situation is so bad that
the people have lost all hope that justice can be done without giving
bribes.'"


McNamara praised the report for confronting the problem head on,
noting Tanzania is the only African government of its kind to take
such a course. Unfortunately, he said, corruption is "rather typical
of the conditions that exist in many, many African countries."


Regarding Ethiopia, McNamara said "One of the reasons that Prime
Minister Meles is so interested in having something done in his
country is that as you know, he led the rebels against the communists
for 17 years. He eventually won, threw them out and came in as prime
minister a couple years ago. Alongside of him, fighting for 17 years
was his closest friend. When Meles became prime minister, he made his
friend deputy prime minister. The friend sent to Swiss bank accounts
$17 million in bribes and he is now in jail."


As part of his presentation, McNamara provided the press with two
texts, a Summary of Measures Needed to Combat Corruption, and a sample
letter he and the Global Coalition for Africa plan to send CEOs
worldwide.


Following are the texts of the list of measures and the letter:



(BEGIN MEASURES TEXT)



Recognizing the widespread prevalence of both Petty and Grand
Corruption in sub-Saharan Africa, sharply focused anti-corruption
campaigns are needed in most, if not all, African countries. Such
campaigns to be successful must be tailored to the needs of each
particular country. But all successful campaigns will have certain
characteristics in common. They will all:


1. Require direct, clear and forceful support of the highest political
authority: the president or prime minister.


2. Introduce transparency and accountability in governmental
functions, particularly in all financial transactions.


3. Encourage a free press and electronic media to forcefully report to
the public on corrupt practices in the society.


4. Organize civil society to address the problems of corruption
brought to light by the process of transparency and the activity of
the media.


5. Introduce into government watch-dog agencies -- anti-corruption
bureaus; inspectors general; auditors general and ombudsmen -- which
will identify corrupt practices and bring them to public attention.


6. Minimize and simplify government regulations, particularly those
involving the issuance of licenses, permits and preferential
positions, thereby restricting opportunities for rent-seeking by
corrupt means.


7. Insert anti-bribery clauses into all major procurement contracts
and with the assistance of both international financial institutions
and bilateral aid agencies insist that international corporations,
bidding on African procurement contracts, accept such clauses and the
penalties associated with their violation.


8. Introduce similar anti-bribery classes into contracts relating to
the privatization of government enterprises and the development of
natural resources.


9.  Ensure that enforcement is predictable and forceful.



10. Seek the support of the OECD nations to: criminalize acts of
bribery; prohibit the deduction of bribes for tax purposes; and erect
barriers to the transfer to Western financial institutions of
financial gains derived from corrupt practices.


(END MEASURES TEXT)



(BEGIN SAMPLE LETTER)



Dear Mr. X:



As a former president of Ford Motor Company and of the World Bank, and
a director of several international corporations, I have seen
corruption related to business transactions increase throughout the
developing world. It has now reached levels where it not only diverts
scarce public resources into private pockets, but literally undermines
effective governance, endangering democracy and eroding the social and
moral fabric of relations.


I wish to inform you of, and solicit your support for, an initiative
recently undertaken by the Global Coalition for Africa (GCA) related
to this problem. The Global Coalition seeks to accelerate economic and
social advance in Africa by bringing together African political
leaders and development-assistance administrators of the OECD nations.
It is co-chaired by President Masire of Botswana, President Konare of
Mali, Prime Minister Meles of Ethiopia, Dr. Ginwala of South Africa,
Minister Pronk of the Netherlands, Minister Marleau of Canada and
myself.


Several Heads of State of African countries asked the Global Coalition
for assistance in combating corruption within their own countries. I
volunteered to help them and suggested that we begin by introducing
anti-bribery clauses into all major procurement contracts, whether
with domestic or international suppliers. The governments would commit
themselves to instruct their officials that they were prohibited from
requesting or accepting bribes. And the governments would require that
the Chief Executive Officers of all companies bidding on such
contracts certify that their employees and agents have been
effectively forbidden to offer or pay bribes. In the event that
bribery occurred, stiff penalties would be enforced against both the
public officials and the company involved.


Six countries -- Malawi, Benin, Tanzania, Uganda, Ethiopia and Mali --
asked for my assistance in introducing the new terms into their
procurement procedure. Along with Ambassador Ould-Abdallah, Executive
Secretary of GCA, and a representative of Transparency International,
I visited the President or Prime Minister of each of the six. They are
all rewriting their procurement regulations to introduce the new terms
into all major procurement contracts, beginning early next year. This
letter is being sent to you because of the possible interest of your
company in bidding on such contracts.


Before undertaking my visits, I discussed my proposal with James
Wolfensohn, President of the World Bank. He endorsed it fully,
promising support not only in relation to contracts financed by the
World Bank but, more generally, in the effort to reduce fraud and
corruption throughout the developing world.


You may have noticed that he referred to the subject in an
extraordinarily powerful speech at the annual meeting of the World
Bank and IMF in Hong Kong on September 23, 1997. He said: "Last year,
I highlighted the importance of tackling the cancer of corruption.
Since then, we have issued new guidelines to staff for dealing with
corruption -- and for ensuring that our own procedures meet the
highest standards for transparency and prosperity. We have also begun
working with a half dozen of our members countries (these are the six
I visited) to develop anti-corruption programs."


At the annual meeting of the Global Coalition for Africa in Maputo,
Mozambique, on November 1-2, 1997, the subject of corruption was the
main item on the agenda. I chaired the session on the means to combat
it and I attach my summary of that debate.


I know that the International Chamber of Commerce is concerned about
the costs and consequences of corruption and that many individual
companies have developed their own codes of conduct to combat bribery.
I believe that endorsement of this African initiative, and a
commitment to its provisions by companies such as yours, will send a
strong signal that corruption will not be tolerated by the
international business community.


If you or your associates have questions on any of these issues,
please let me know. I will be happy to try to answer them in writing
or in person.


Sincerely,



Robert S. McNamara



(END SAMPLE LETTER)