Wednesday, 28 September 2016

Reforming national institutions crucial to tackle corruption




Tola Bedru
Democracy is an evolutionary process that takes time to grow. It is a process of solving political and economic problems through peaceful dialogue and compromise. It must be nurtured and allowed to grow like a plant or a tree. It must be adapted to a country’s tradition and culture and draw from the experiences of other countries with working democracies.
Institutions that support democracy and the free market system must be encouraged to evolve. It is important to be clear about what is meant by “institutions”. Institutions are rules of human behavior that provide incentives under which rational people act. They are accepted modes of behavior protected by culture. They involve laws, social norms, traditions, beliefs and other established rules of human behavior. Institutions provide the carrots and sticks that direct all forms of human activity, including economic activity. Institutions and organizations are not same, although they are sometimes used interchangeably. Organizations operate within a set of institutions. Whether organizations and individuals can serve a constructive or destructive purpose depends on the institutional framework in which they operate.
The challenge of overcoming poverty in any society is to develop institutions that support and promote economic growth. In order to promote economic growth, institutions should provide individuals to work hard, to save and invest, and for entrepreneurs to take risks and to actively pursue economic opportunities, for firms to improve their production methods, for governments to use public revenue efficiently to provide public goods and to design cost-effective programs to meet socially well-defined goals. Institutions that enhance human welfare are those that channel individual and organizational efforts to productive activities by encouraging innovation. Such institutions are best established in economies where: property rights are well defined and secured, and laws are clearly defined and fairly enforced.
It is in enlightened self-interest of all stakeholders in Ethiopia, which includes the Government, the various opposition groups, civil society organizations and individuals to work together and allow democracy and the free enterprise system to grow by pushing forward for a peaceful democratic political and economic reform. There is also a need in this regard, to begin the practice of peaceful and constructive partisan power politics. For this to occur, politicians must learn to change from a negative sum or zero-sum to positive-sum thinking mode of thinking.
In the process of transition to a market economy, it is important to be clear about the appropriate role of government. Economies around the world have stagnated or declined because of both market failure and government or policy failure or both. Areas of market failure are those where the private sector cannot be relied upon to deliver goods and services such as in the areas of public health, public education, agricultural research and environmental protection. The proper role of government includes the provision of legal and institutional structure that support private sector and markets, as well as investments on public goods such as roads, public education and public health services. Government also has a legitimate role in rectifying extreme inequality of income and wealth through progressive taxation.
Recently, Ethiopian public has come to call out loudly about corruption and rent-seeking, or more generally, lack of “good governance”. But as I drawn from several literatures, lack of “good governance” is largely an outcome of inappropriate institutional pillars, in which they would usually require a continual updating or re-installing. More importantly, unless it is about the issue of whether the public, the ruling party, and/or the government of an economy are awakens too early, too late, and somewhere in between, such event is not too strange -- it usually happens in both emerging and developed economies right after an economy has achieved some good economic progress.
Hence such event does not necessarily indicate an erosion of longer term potential, but it does call for urgent corrective action. In light of this, though arguably it is lately initiated, and its management is to be seen in the years ahead, such as the upcoming institutional pillars or systems that the government would put in place, both the public, the party, and the government are in a promising stage – they have at least started to pin point the potential causes for the observed lack of good governance through nationwide public forums.
In general, the kind of government and society ruled solely by self-interested individuals will be a ‘rent-collecting state or predatory government or in other words a government by thieves. Government theft’, for example, does manifest itself not only in abusing public authority for the fulfillment of ‘individual self-interest’ but also in undermining the spirits of non-self-interested individuals, coalitions and officials in the name of law, free media, democracy and so on--cynicism. While non-self-interestedness, the rule of self by the individual from within—intrinsic control, self-interestedness is a rule by extrinsic appetites like material temptations.
Historically, Ethiopia has a reputation for low tolerance for corruption. However, there seems to be an increasing trend or at least the perception of it.
Corruption and rent seeking activities in such environment cannot really be eliminated by punishing those that engage in corruption. Combating corruption is an institutional problem of designing the rules of the game with transparency and accountability. Corruption involves the illegal perversion of public assets and institutions for private benefit. It is best prevented by the rule of law with checks and balances, independent justice system, overseen by the free press that exposes corruption to the public.
It is imperative to sustain higher economic growth during the coming years and beyond in order to achieve the vision of Ethiopia and eventually eradicate poverty and to improve people's livelihood. Accordingly, investments on growth enhancing sectors such as infrastructure and social sectors shall be continued.
Establishing a stable democratic and developmental state and thereby creating a suitable environment for successive development endeavors; Strengthening the civil service and civic societies so as to strengthen democratic institutions; establishing a system for citizens’ access to information; Strengthening the effectiveness of the justice system in terms of its ability to discover the truth through legal procedures; amending laws to ensure that implementation and interpretation of the laws is done in conformity with the constitution; Ensuring independence, transparency and accountability of courts and the judicial system; Strengthening law enforcement institutions by human resource, knowledge, skill and equipment; Carrying out integrated activities to enhance the public’s understanding and awareness of constitutional issues; and augmenting the custom and tradition of peaceful resolution of disputes should be given special emphasis over the coming years.
The necessity of peaceful political and economic reform follows from recent historical experiences of Ethiopia. What is needed now may be to begin the tradition of peaceful political transition and reform. Future political transition must be peaceful. Violent removal of any regime is likely to produce a quagmire for the nation and citizens should firmly reject such attempts.

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