This Week in Markets and Democracy: International Anticorruption Day, Corruption in Ukraine, and Elections in Venezuela

International Anticorruption Day

December 9 marked the United Nations’ thirteenth annual International Anticorruption Day, offering a chance to reflect on global anticorruption efforts this year—from successful antigraft cases to ongoing challenges fighting high-level theft. In commemoration, here’s what we’ve been reading:

Transparency International surveyed perceptions of corruption in sub-Saharan Africa. Fifty-eight percent of citizens believe corruption is on the rise. Nearly one in four admitted to paying a bribe in the past year, many to police or in courts. The report calls for greater government efforts to end impunity, as well as more transparency from the private sector.

The World Bank’s Ravi Kumar charts how corruption affects business globally. Surveys with over thirteen thousand companies in East Asia, South Asia, and sub-Saharan Africa reveal that “gifts” are often expected for everything from construction deals to operating licenses, while over 50 percent of companies in the Middle East identify corruption as a major constraint.

Political scientists Daron Acemoglu and James A. Robinson argue that tackling corruption isn’t enough to combat global poverty.  They say bribery and graft are just symptoms of the larger problem of weak economic and political institutions that undermine inclusive growth.

Finally, for an overview of  bribery cases around the world, the Mintz Group maps data on the total penalties assessed for FCPA violations by country. Nigeria has paid the most since 1977, with a majority of cases in the oil industry.

Ukraine’s Corruption Risks Setbacks

Corruption may undermine Ukraine’s fragile economic recovery just as it exits an eighteen-month recession. A set of ambitious reforms, backed by $17.5 billion from the International Monetary Fund (IMF), enabled an October credit rating upgrade and looks to slightly revive GDP growth in 2016.

But as CFR’s Rob Khan highlights, stalled progress on corruption and rule of law threatens IMF support and the larger recovery. And a brewing political confrontation risks further setbacks. Parliament remains at an impasse over the 2016 budget and mounting corruption scandals, including a Minister of Parliament forced out over bribery allegations.  During his visit to Kiev this week, Vice President Joe Biden warned that Ukraine must end impunity for oligarchs and step up a judiciary overhaul, even as he announced an additional $190 million in U.S. assistance for needed reforms.

What’s Next for Venezuela?

Venezuela’s opposition Democratic Unity coalition won 112 of the 167 National Assembly seats in last week’s legislative elections, the first time they will control congress since Chavez’s rise to power in 1999. The supermajority gives the opposition the power to remove central bank directors, Supreme Court (STJ) judges, cabinet members, and even President Nicolás Maduro himself through a referendum starting in April. With this new power comes responsibility for the deep economic and other malaises Venezuela faces. And Maduro could still undercut their base—many worry the lame duck congress will devolve more powers to the executive branch and further stack the judiciary.