http://www.businessweek.com/articles/2014-02-03/bill-gates-is-right-corruption-isnt-the-biggest-aid-problem
When we talk about why capital doesn't always flow from countries that are capital rich to countries that are capital poor, its often cited that a lack of infrastructure especially regarding legal systems, property rights, and corruption in general are all reasons why. Corruption can be looked at as a tax on aid and governmental transactions in general that makes aid and government less efficient. Many politicians express that corruption in third world countries is enemy number one and a serious problem that needs to be tackled.
However, Bill Gates has extensive knowledge in the area of aid and capital investment in capital poor countries with the Bill and Melinda Gates Foundation and he is able to paint a more realistic picture of what exactly needs to happen to help these countries. A survey was done by the World Bank to see what the major obstacles facing companies around the world are. They were given 15 choices and were asked to rank them. Overall, corruption was 8th out of the 15 and in less than 1% of countries was corruption the top answer.
Corruption is still a major concern, but its merely a symptom of a problem. Its a symptom that stems from poor governance and weak institutions. Its important that as the article says, "civil society groups and donors should push for greater transparency, for reduced regulation and capricious bureaucracy, and for better policing."
Corruption certainly can slow a country's development as people at the top who receive the aid and run the country's resources can take money off the top. However, there are other ways to aid a nation and I think Bill Gates is on the right track. His foundation does extraordinary work on a huge level. Fixing the governments in these nations could help remove the symptoms of corruption.
ReplyDeleteI think that this is an interesting statement from the article, "And corruption is a symptom of a larger problem—poor governance and weak institutions. For all these reasons, civil society groups and donors should push for greater transparency, for reduced regulation and capricious bureaucracy, and for better policing."
ReplyDeleteAlso, I think that this statement is valuable to think about, "But that doesn’t mean that we should give up on government—or on aid. As Gates points out in the letter, “Four of the past seven governors of Illinois have gone to prison for corruption, and to my knowledge no one has demanded that Illinois schools be shut down or its highways closed.”
I think that aid is something that is still important and can still help countries, but in order to make change sustainable, we must find ways to help governments rise up and be strong examples for their country.
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ReplyDeleteCorruption definitely slows the growth of a country, but as we know its the least developed countries that face the highest corruption.
ReplyDeleteI think corruption cannot be completely eliminated in developing countries as politicians need the 'donations' and fundings from large corporations to win a seat while corporations need these politicians to help them get business contracts and huge profits.
I think the developing countries should try to learn from the history, mistakes and the path of success of the current developed countries. By comparing the various economic policies and models, they can come to a solution that best fits their country.
I think also various departments/ institutions should be rewarded. Just as offices have 'employee of the month', these departments should be rewarded for their contributions which will encourage them to work harder.