Corruption Reality Check

A report shows the limits of what World Bank reformers can do.

IN THE DEVELOPING world, government corruption is both a symptom and a cause of economic stagnation. Thus, at the World Bank, improving "governance" is a hot concept, and it should be, even if the bank's own health and development projects have sometimes been infected with graft. Unfortunately, lending money for "public sector reform," as the bank calls it, does not always produce results, as a report from the bank's internal Independent Evaluation Group, makes abundantly, even depressingly, clear.

The report, which was released last week, cushions its findings in bureaucratese, calling bank anti-corruption efforts "moderately satisfactory." But beyond the executive summary, the sorry details emerge. Between 1990 and 2006, the bank dished out $20 billion for training, advice and other forms of aid, and there has been precious little bang for all those bucks. About a fifth of the money -- $4 billion -- went to civil service reform. But, the report says, this huge expenditure achieved almost nothing, partly because of resistance by bureaucracies, and partly because, except for downsizing, the bank had no strategy.

With the bank's help, countries did improve their abilities to draft coherent budgets and collect taxes. But when it came to spending the money honestly, the results were much less impressive, as measured by widely accepted surveys of perceived corruption. And what little progress there was took place mostly where it was needed least: in East European and Latin American countries that are no longer poor. Among the poorest countries, the bank's largess reduced corruption very little; indeed, recipients of bank funds performed no better than countries that got none.

The report hints that some governments treat internationally funded anti-corruption efforts as a bit of a show. In one large African country, for example, "the Good Governance Coordination Unit . . . and the Prevention and Combating of Corruption Bureau have not done much yet. The national anti-corruption strategy and action plan . . . seems an ambitious and all-encompassing

anti-corruption approach, [but] it lacks serious mechanisms to monitor compliance or to hold implementing agencies accountable."

There was a note of exhaustion in the report's repeated call for greater "realism," given foot-dragging by "political elites" in the developing world. And it is worth asking whether

multilateral development agencies really can fight corruption through aid programs negotiated with corrupt governments.

On a more promising note, the report lauds "efforts to increase the citizens' capability to monitor and challenge abuses of the system and to inform the citizens about their rights and entitlements. Breaking the culture of secrecy that pervades the government functioning and empowering people to demand public accountability are important components in such an effort." Sunlight, plus people power, might succeed where international aid has not.