2016 OECD Integrity Forum: Fighting the Hidden Tariff - Global Trade Without Corruption
Opening remarks by Angel Gurría
19 April 2016
OECD Conference Centre, Paris
(As prepared for delivery)
Ladies and Gentlemen,
I am delighted to open the 4th OECD Integrity Forum, and to welcome so many leaders from so many different policy communities and countries. I want to thank the EU Trade Commissioner Cecilia Malmström and the UK Anti-Corruption Champion, Sir Eric Pickles, for joining me to open this crucial meeting.
Allow me to take this opportunity to also thank our Integrity Forum knowledge partners: the Dutch Presidency of the EU, the Alliance for Integrity, the German development agency GIZ, the Business for Social Responsibility, the Maritime Anti-Corruption Network, the International Anti-Corruption Academy, and the U4 Anti-Corruption Resource Centre. We are all working together to tackle corruption and promote the culture of integrity.
Integrity is not just a moral issue; it’s also about making our economies more productive, our public sectors more efficient, our societies and our economies more inclusive. It’s about restoring trust, not just trust in government, but trust in public institutions, regulators, banks, and corporations.
Recent revelations like the ones uncovered by the “Panama Papers” and the Unaoil bribery scandal show how far-reaching the issue of integrity violations has become. Both scandals reveal how opaque corporate structures, which hide their true beneficial owners, can facilitate corruption payments, but also tax evasion, fraud, embezzlement of state-owned assets and money laundering.
These scandals are yet another wake up call for the international community to step up efforts to strengthen global governance against these blights on our economies and societies.
The OECD is working on all these fronts, but we have chosen to focus at this Forum on trade: one of the main cylinders of growth.
Good governance and streamlined procedures make trade more efficient, but they also deliver greater integrity and security. For example, we have estimated that full implementation of the WTO Trade Facilitation Agreement, which would ensure transparency, predictability and accountability in global trade, could reduce the costs of delays and uncertainty by around 12 to almost 18%. The Agreement’s specific provisions for promoting integrity and impartiality could alone reduce trade costs by up to one percentage point.
Effective integrity measures will also reduce the loss of revenue caused by customs-related corruption – which is estimated to cost World Customs Organization (WCO) members at least 2 billion US dollars in lost trade taxes each year – as well as countries’ exposure to illicit activities carried out by organised crime and terrorist groups.
Another high-risk area is public procurement, which represents a substantial share of world trade flows, amounting to one trillion euros per year. Our analysis shows that 57% of concluded foreign bribery cases between 1999 and 2014 involved public procurement. We need a stronger focus on increasing integrity in the procurement of goods and services if we are to win the battle against corruption in cross-border trade.
Corruption also facilitates trade of counterfeit and pirated goods, which, according to our joint report with the European Union Intellectual Property Office, was worth over 460 billion US dollars in 2013. Policymakers need to know the facts so they can fully understand the benefits of “clean trade”, and how to achieve it.
The OECD is helping countries tackle corruption in these and many other areas, including through its Anti-Bribery Convention, which has been a game changer for combating cross-border bribery. At the Anti-Bribery Ministerial meeting last month, Ministers and representatives from 50 countries endorsed a Declaration reaffirming their commitment to strengthening enforcement of their anti-foreign bribery laws, as well as taking more proactive preventive steps. We are also advancing our work on prevention and integrity, and on related areas to promote high standards of corporate governance and responsible business conduct, both of which include chapters on transparency and bribery.
In terms of public procurement, in 2015 the OECD helped co-ordinate the G20 Guiding Principles on Integrity in Public Procurement. And our Council approved the Recommendation on Public Procurement, including 12 integrated actions to ensure the efficiency, integrity, transparency and accountability of procurement systems.
Our work on corruption is also tightly linked to our initiative to establish robust international standards on tax transparency. 132 jurisdictions have committed to the standard on exchange of information ‘on request.’ Of those, 96 jurisdictions will introduce automatic exchange of financial account information within the next two years. Addressing transparency of beneficial ownership information will be essential to fight both tax evasion and corruption.
We need to work towards establishing a comprehensive framework to tackle corruption in all its shapes, building on the expertise of relevant committees and policy communities. Our work on prevention and integrity should complement better our work on foreign bribery. Above all, effective implementation of our standards should be the ultimate goal, starting with our own Members!
The OECD stands ready to help all countries curb corruption. In fact, during this Integrity Week, a Recommendation on Public Integrity will be adopted by our Members, which will provide ‘whole of government’ recommendations to address new challenges and achieve a lasting culture of integrity. And we need to keep working to bring the remaining G20 countries to the Anti-Bribery Convention.
Of course, we cannot and are not doing this alone. Corruption is insidious, multi-faceted. We need to continue working with different multilateral agencies, international organisations and civil society organisations that have a mandate to fight corruption. Our work will also be guided by the expert advice of the High-Level Advisory Group on Anti-Corruption and Integrity, with whom I just met this morning and which is finalising a report with key recommendations for our work going forward.
Ladies and Gentlemen,
Anti-corruption is top of the world agenda, and as Martin Luther King once said: “The time is always right to do what is right”. Now is the time. 2016 will be a big year for the fight against corruption.
Major players around the world are getting together, gathering their ideas, their experiences and co-ordinating their efforts. This timely, critical Forum is part of that process. We just had the OECD Anti-Bribery Ministerial in March, in May we go to London for the Anti-Corruption Summit and in June the Conference on Strengthening International Co-operation in Law Enforcement will take place here at the OECD. We need to link these events together as a continuum, so that they reinforce each other, so that they open a new chapter in global justice and integrity.
The stakes couldn’t be higher. So let’s be bold, let’s be innovative, let’s be forward-looking as we design, deliver and implement policies for a fairer, more transparent world. Thank you.