Thursday, April 28, 2005

Corruption still plagues El Salvador

Corruption remains a problem impinging the progress of El Salvador's economy. This week, La Prensa revealed the details of a report concerning corruption in the Vice Ministry of Transportation. The report found that because of a lack of organization and reliable controls in the government body, there was an out-of-control black market for the licenses which authorize buses to run on various routes throughout the country.

The University of Central America's Proceso weighed in with a commentary proclaiming that the ARENA government was running the country for a selective group of big businesses. To succeed in business you need to know how to grease the wheels:

Generally, the businessmen interested in providing goods or services to the government, obtaining a license, or performing different kinds of procedures must do illegal expenditures on the official responsible for the transaction, which is understood as gratitude. That is how some businessmen give them presents or hand them a piece of the deal, invite them to lunch, pay for their trips abroad, give them cash, or give them free products or services. The best way to win a bid for a project is to pay to a public official a percentage of the contract’s value. The procedures followed by the customs service, and obtaining a license, permits, the certificate of sanitation, or the environmental certificate turn faster with diverse expenditures.

The commentary notes that the lack of transparency and honest practices impedes investment in the country.

For those of you who like indexes and rankings, the 2004 Transparency International Corruption Perceptions Index ranked El Salvador 51 out of 146 countries when it came to corruption. (A lower ranking meant a cleaner government).


Anonymous said...

although it sounds like El Salvador had a bad ranking on the corruption scale, the truth is that the country rated less corrupt than any of it's neighbors, with a better ranking than Guatemala, Honduras, and Nicaruagua, and actually did better than France. For the region, El Salvador is less corrupt than the other countries around her. So progress must be being made, don't you think?

Tim said...

Unfortunately I don't know much about what the index really measures. The producers of the index did note that El Salvador had made progress from the previous year. On the other hand, a poll of business people by the Institute for study of public opinion at the University of Central America last fall showed business people viewed corruption as a real problem.

David said...

TI polls are based on perception of corruption. I've argued that in a place like El Salvador, where there is no real opposition press among the major media, we only get a glimpse of the actual corruption that exists. Yes, check out the March IUDOP poll that surveyed businessmen. Much more profound analysis than we've previously seen.

The fact that the ANDA scandal last year reflected WELL on the ARENA govt was a good example of how the media can spin corruption scandals (which we all know are just the tip of the iceberg) toward governmental advantage.

Tim said...

The IUDOP polls about corruption can be found here.

For example, 83% of businessmen in the construction industry reported at least some negative impact from corruption on their business.