Watchdog: Corruption Widespread in Defense Sectors Globally

MOSCOW, January 29 (RIA Novosti) – Two-thirds of the world’s nations, including Russia and other leading global arms traders, lack the tools to counter corruption in their defense sectors, a new survey by anti-corruption watchdog Transparency International said on Tuesday.

According to the first ever index measuring how governments fight graft in the defense sector, released by Transparency International UK’s Defense and Security Programme, 70 percent of countries fail to protect the industry from corruption.

The survey covers 82 countries responsible for 94 percent (worth $1.6 trillion) of global military expenditure in 2011. The watchdog’s report concluded the global cost of corruption in the defense sector is about $20 billion annually.

The index lists Russia along with Belarus, China, Israel, Kazakhstan and Rwanda, among others, as states at “high risk” of corruption in their defense sector.

Nine countries ­- Algeria, Angola, Cameroon, Democratic Republic of the Congo, Egypt, Eritrea, Libya, Syria, and Yemen ̶ are classified in the index as states with a “critical risk” of corruption, for their lack of basic measures such as controls to enforce accountability.

The countries at “very high risk” of corruption include Afghanistan, Bahrain, Iran, the Philippines, Qatar, Saudi Arabia and Sri Lanka.

Britain, South Korea, Sweden and the United States are among countries considered to be at “low risk”, while France, Poland, Italy and Spain are moderate-risk states. Australia and Germany are the only countries listed in the index as states with “strong anti-corruption mechanisms.”

“Corruption in defense is dangerous, divisive and wasteful, and the cost is paid by citizens, soldiers, companies and governments,” yet the majority of governments do too little to prevent it, leaving numerous opportunities to hide corruption from public scrutiny and waste money that could be better spent,” Transparency International UK’s Defence and Security Programme director Mark Pyman said in a statement.

In the past few months, Russia has been cracking down on corruption in its arms business and in Defense Ministry-affiliated firms. Deputy Prime Minister Dmitry Rogozin, who has responsibiity for the domestic arms industry, warned in November that a “clean-out was inevitable.”

The latest part of that drive has been the start of an investigation into a huge fraud case in the Oboronservis defense property management company, involving state assets worth at least $130 million. The investigation led to the ouster of Anatoly Serdyukov as Defense Minister and a reshuffle among the top ranks.

Irina Yarovaya, a lawmaker with the United Russia who chairs the State Duma’s anti-corruption committee, said the watchdog’s report reflects “unfair competition” and a “dangerous environment” in Russia’s defense sector, but did not elaborate.

In October 2012, Transparency International released a study of 129 world defense companies, which listed Russian defense firms and arms exporters as among the least transparent in the world.

Representatives of the Russian companies mentioned in that report told RIA Novosti the Transparency International “blacklist” was an example of unfair business practices and an attempt to undermine trust in Russian companies in the global arms market.


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