Corrupting Peace? Peacebuilding and Post-conflict Corruption

Many conflict-affected countries are among the most corrupt in the world, and corruption is frequently reported as a major concern of local populations and foreign aid agencies during transition to peace. Tackling corruption is part of 'liberal peacebuilding', which seeks to consolidate peace through democracy and free markets economy. Yet liberalization policies may also foster corruption. Using a preliminary analysis of selected corruption perception indicators, this article finds tenuous and divergent support for post-conflict patterns of corruption. Three main arguments linking liberal peacebuilding with higher levels of corruption are then presented for further elaboration, and a research agenda is outlined. Notes 1. UN, 'Corruption: Threats and Trends in the Twenty-first Century', UN doc., A/CONF.203/6, 2005. 2. See, for example, opinion polls: 'South East Europe Public Agenda Survey' by the South East Europe Democracy Support, 2002; Nicaragua, 'National Integrity Survey', CIET International, 1998; 'Governance and Anti-corruption Report for Sierra Leone', World Bank, 2003; 'Cambodia Governance and Corruption Diagnostic', World Bank, May 2000. 3. In the UK, a new anti-corruption and anti-bribery measure was enacted as part of the Anti-terrorism, Crime and Security Act 2001. In the United States, see the 1998, 2002 and 2006 'National Security Strategy of the United States'; see also 'Terrorism, Corruption and War', posted by the US State Department (at: usinfo.state.gov/products/pubs/iraq/war.htm); D. Kaufmann, 'Corruption, Governance and Security: Challenges for the Rich Countries and the World', Global Competitiveness Report 2004/2005, Washington, DC: World Bank, 2004; William Reno, 'The Politics of Insurgency in Collapsing States', Development and Change, Vol.33, No.5, 2002, pp.837–58; K. Thachuk, 'Corruption and International Security', SAIS Review, Vol.25, No.1, 2005, pp.143–52. 4. I refer to peacebuilding as complementary to peacemaking (bringing an end to hostilities) and peacekeeping (maintaining peace through military force to separate conflicting parties). As such, peacebuilding aims to create a 'self-sustaining' peace, one that does not require external peacekeeping. 5. Emil Bolongaita, 'Controlling Corruption in Post-conflict countries', Kroc Institute Occasional Paper No. 26, January 2005; Philippe Le Billon, 'Corruption, Reconstruction and Oil Governance in Iraq', Third World Quarterly, Vol.26, No.4, 2005, pp.679–98; Le Billon, 'Overcoming Corruption in the Wake of Conflict', Global Corruption Report, Berlin: Transparency International, 2005, pp.73–82; A. Alix Boucher, William J. Durch, Margarete Midyette, Sarah Rose and Jason Terry, 'Mapping and Fighting Corruption in War-torn States', Washington, DC: Henry L. Stimson Centre, 2006; Madelene O'Donnell, 'Post-conflict Corruption: A Rule of Law Agenda?', in Agnes Hurwitz and Reyko Huang (eds) Civil War and the Rule of Law, Boulder, CO: Lynne Rienner, 2008. 6. General Accounting Office (GAO), 'Bosnia Peace Operation: Crime and Corruption Threaten Successful Implementation of the Dayton Peace Agreement', GAO/ NSIAD-00-156, Washington, DC, 2000; International Crisis Group (ICG), 'Courting Disaster: The Misrule of Law in Bosnia and Herzegovina, Balkans', Report No. 127, Brussels, 2002; Vera Devine, 'Corruption in Post-war Reconstruction: The Experience of Bosnia and Herzegovina', in David Large (ed.), Corruption in Post War Reconstruction. Confronting the Vicious Circle, Beirut: Lebanese Transparency Association, TIRI and UNDP, 2005. 7. Yet the report does not locate the 'fight against corruption' within effective peacebuilding, and only refers twice more to corruption: as an 'economic' cause of conflict, and in discussing the employment of UN volunteers as cheap labour potentially 'corrupting' the programme as these volunteers 'work alongside colleagues who are making three or four times their salary for similar functions'. UN 'Report of the Panel on United Nations Peace Operations', UN doc., A/55/305; S/2000/809, 2000, p.24. 8. Bolongaita (see n.5 above). 9. Akhil Gupta, Postcolonial Development. Agriculture in the Making of Modern India, Durham, NC: Duke University Press, 1998. 10. Large (see n.6 above); Jens C. Andvig, 'Corruption and Armed Conflict. Some Stirring Around in the Governance Soup', Working Paper 720, Norwegian Institute of International Affairs (NUPI), 2007. 11. Paul Collier, Lance Elliot, Håvard Hegre, Anke Hoeffler, Marta Reynal-Querol and Nicholas Sambanis, 'Breaking the Conflict Trap: Civil War and Development Policy', Washington, DC: World Bank, 2003; David Keen, The Economic Functions of Civil Wars, Adelphi Paper No. 320, Oxford: IISS/Oxford University Press, 1998; William Reno, Warlord Politics and African States, Boulder, CO: Lynne Rienner, 1998; Joel S. Hellman, Geraint Jones and Daniel Kaufmann, 'Seize the State, Seize the Day: State Capture and Influence in Transition Economies', Journal of Comparative Economics, Vol.31, No.4, 2003, pp.751–73; Jens C. Andvig, 'Corruption and Fast Change', World Development, Vol.34, No.2, 2006, pp.328–40. 12. Ed Brown and Jonathan Cloke, 'Neoliberal Reform, Governance and Corruption in the South: Assessing the International Anti-corruption Crusade', Antipode, Vol.36, No.2, 2004, pp.272–94; Brown and Cloke, 'Neoliberal Reform, Governance and Corruption in Central America: Exploring the Nicaraguan Case', Political Geography, Vol.24, No.5, 2005, pp.601–30. 13. Le Billon (see n.5 above), pp.679–98; Le Billon, 'Buying Peace or Fuelling War: The Role of Corruption in Armed Conflicts', Journal of International Development, Vol.15, 2003, pp.413–26. 14. OECD Creditor Reporting System for the period 1989–2002, this figure includes reconstruction and development assistance and excludes food aid, emergency relief, debt relief, and military intervention or peacekeeping costs. 15. While conflict situations grab the attention of the media, aid has been lower than usual in non-conflict situations over the past decade; Collier et al. (see n.11 above). 16. The 'reconstruction' budget for the period 2003–06 amounted to more than US$62 billion (Development Fund for Iraq: US$28.2 billion; US government Iraq Relief and Reconstruction Fund: US$20.9 billion; Official Development Assistance from other donors: US$13 billon (for 2003–05 only), including World Bank Iraqi Trust Fund: US$0.4 billion. Sources: www.state.gov/p/nea/rls/rpt/60857.htm; World Bank Operations in Iraq, 28 Feb. 2007; See Looney, this issue. 17. Daniel Kaufmann and Massimo Mastruzzi, Governance Matters V: Governance Indicators for 1996–2005, Washington, DC: World Bank, 2006. 18. Large (see n.6 above). 19. Charles Tilly, 'War Making as State Making', in Peter Evans, Dietrich Rueschemeyer and Theda Skocpol (eds), Bringing the State Back, Cambridge: Cambridge University Press, 1985; William D. Stanley, The Protection Racket State: Elite Politics, Military Extortion, and Civil War in El Salvador, Philadelphia, PA: Temple University Press, 1996. Ideals and strict discipline in armed movements have also limited corruption, as with the Eritrean People's Liberation Front. In Afghanistan, the Taliban regime was initially well received by the population for putting an end to the corruption of mujahedin warlords; Christopher Cramer and Jonathan Goodhand, 'Try Again, Fail Again, Fail Better? War, the State, and the "Post-conflict" Challenge in Afghanistan', Development and Change, Vol.33, No.5, 2002, pp.885–909. 20. David Keen, The Economic Functions of Civil Wars, Adelphi Paper No. 320, Oxford: IISS/Oxford University Press, 1998. 21. Ibid. Widespread participation in the 'illegal' logging in Cambodia helped sustain the conflict for several years, see Le Billon, 'The Political Ecology of Transition in Cambodia 1989–1999: War, Peace and Forest Exploitation', Development and Change, Vol.31, No.4, 2000, pp.785–805. 22. Several donor agencies have streamlined assessments of corruption in many 'post-conflict' governance analyses, most notably the World Bank and USAID through its 'Office of Democracy and Governance'. 23. TI's Corruption Perception Index is a composite index, PRS's corruption index essentially measures the risk posed by corruption to the private sector (and especially foreign investors). 24. Including: Angola, Côte d'Ivoire, Croatia, Democratic Republic of Congo, El Salvador, Ethiopia, Guatemala, Haiti, Liberia, Mozambique, Namibia, Sierra Leone, Somalia and Sudan. 25. Theresa Thompson and Anwar Shah, 'Transparency International's Corruption Perceptions Index: Whose Perceptions Are They Anyway?' Discussion Paper, World Bank, 2005 (at: siteresources.worldbank.org/INTWBIGOVANTCOR/Resources/ TransparencyInternationalCorruptionIndex.pdf). 26. The CPI data are available from 1998 to 2006. Note that PRS data were included in the CPI until 2000, and that PRS data are converted to match CPI index range (zero to ten). 27. Roland Paris, At War's End: Building Peace after Conflict, Cambridge: Cambridge University Press, 2004; see also M. Duffield, Global Governance and the New Wars. The Merging of Development and Security, London: Zed, 2001; Oliver P. Richmond, The Transformation of Peace, Basingstoke: Palgrave, 2005. 28. Human Security Brief 2006, Vancouver: Human Security Report Project, Simon Fraser University (at: www.humansecuritybrief.info). 29. Oliver P. Richmond and Jason Franks, 'Liberal Hubris? Virtual Peace in Cambodia', Security Dialogue, Vol.38, No.1, 2007, p.30. 30. Le Billon (see n.13 above), pp.413–26. 31. Joe Hanlon, 'Do Donors Promote Corruption? The Case of Mozambique', Third World Quarterly, Vol.25, No.4, 2004, pp.747–63. 32. Jon Moran, 'Democratic Transitions and Forms of Corruption', Crime, Law and Social Change, Vol.36, No.4, 2001, pp.379–93; Marcin Walecki, 'Political Money and Corruption', in Global Corruption Report 2004: Political Corruption, London: Transparency International and Pluto Press, 2004; Alan Doig and Heather Marquette, 'Corruption and Democratization – The Litmus Test of International Donor Agency Intentions?', Futures, Vol.37, 2005, pp.199–213. 33. Fatiha Talahite, 'Économie Administrée, Corruption et Engrenage de la Violence en Algérie: Corruption, Libéralisation, Démocratisation', Tiers Monde, Vol.161, 2000, pp.49–74; Graham Harrison, 'Corruption as "Boundary Politics": The State, Democratisation, and Mozambique's Unstable Liberalisation', Third World Quarterly, Vol.20, No.3, 1999, pp.537–50. 34. R.T. Naylor, Wages of Crime: Black Markets, Illegal Finance, and the Underworld Economy, Ithaca, NY: Cornell University Press, 2004. 35. Hanlon (see n.31 above), pp.747–63; Roger Tangri and Andrew M. Mwenda, 'Politics, Donors and the Ineffectiveness of Anti-corruption Institutions in Uganda', Journal of Modern African Studies, Vol.44, No.1, 2006, pp.101–24. 36. Naomi Klein, The Shock Doctrine: The Rise of Disaster Capitalism, Toronto: Knopf, 2007. 37. Glen Biglaiser and Karl DeRouen, 'Following the Flag: Troop Deployment and U.S. Foreign Direct Investment', International Studies Quarterly, Vol.51, 2007, pp.835–54. 38. Stephanie R. Ahern, 'Foreign Direct Investment and the Economic Wilderness States: The Effects of War and Foreign Military Intervention', paper at the Annual Meeting of the International Studies Association, Honolulu, 2005. 39. Frederik Galtung, 'Introduction: The Corruption Dimension of Post-war Reconstruction', in Large (see n.6 above); Giorgio Agamben, State of Exception, Chicago: University of Chicago Press, 2004. 40. With respect to humanitarian relief, see Barnaby Willitts-King and Paul Harvey, Managing the Risks of Corruption in Humanitarian Relief Operations, London: Overseas Development Institute, 2005. 41. Cash inflow represented close to US$20.6 billion, half from oil sales, the rest from transfers of the oil-for-food programme and repatriated funds from the Saddam Hussein regime (at: govinfo.library.unt.edu/cpa-iraq/budget/DFI_26jun2004.xls). 42. John B. Taylor, 'Billions over Baghdad', New York Times, 27 Feb. 2007. 43. Jeremy Kahn, 'Where did all the Cash go in Iraq? Treasury's Reconstruction Efforts are just as Flawed as the Rest', The New Republic, 6 Mar. 2007; Henry A. Waxman, 'Cash transfers to the Coalition Provisional Authority', Committee on Oversight and Government Reform, Congress of the United States, 6 Feb. 2007 (at: oversight.house.gov/Documents/20070206130101-80952.pdf). 44. For example, Deputy Defense Secretary Paul Wolfowitz stressed to Congress that: 'There's a lot of money to pay for this [reconstruction] that doesn't have to be U.S. taxpayer money, and it starts with the assets of the Iraqi people', House Committee on Appropriations Hearing on a Supplemental War Regulation, 27 Mar. 2003 [emphasis added]; Le Billon (see n.5 above), pp. 679–98. 45. Collier et al. (see n.11 above). 46. If transitional international administration helped keep peace-spoilers and war criminals out, it also struck bargains with corrupt politicians deemed non-threatening to the political status quo; Richard Caplan, A New Trusteeship: The International Administration of War-torn Territories, Adelphi Paper 341, Oxford: IISS/Oxford University Press, 2002. 47. Mitchell A. Seligson, Good Governance and Transparency in Honduras After Hurricane Mitch: A Study of Citizen Views, Alexandria, VA: Casals and Associates, 2001; T.E. Cox, 'An Ounce of Prevention. Oversight of Disaster Reconstruction Activities in Central America and the Caribbean', Journal of Public Inquiry, Fall/Winter, 2001, pp.33–6. 48. Ed Brown, 'Still their Backyard? The US and Post-Mitch Development Strategies in Nicaragua', Political Geography, Vol.19, 2000, pp.543–72; Brown and Cloke 'Neoliberal Reform, Governance and Corruption in Central America: Exploring the Nicaraguan Case' (see n.12 above); B. Wisner, 'Risk and the Neoliberal State: Why Post-Mitch Lessons didn't Reduce El Salvaldor's Earthquake Losses', Disasters, Vol.25, No.3, 2001, pp.251–68. 49. Paul Collier and Anke Hoeffler, 'Murder by Numbers: Socio-economic Determinants of Homicide and Civil War', WPS/2004-10, Oxford: Centre for the Study of African Economies Series, 2004. 50. Alberto Alesina and Beatrice Weder, 'Do Corrupt Governments Receive Less Foreign Aid?', American Economic Review, Vol.92, No.4, 2002, pp.1126–37. 51. Pete Ewins, Paul Harvey, Kevin Savage and Alex Jacobs, Mapping the Risks of Corruption in Humanitarian Action, London: Overseas Development Institute and Management Accounting for NGOs, 2006. 52. Norwegian Refugee Council, Angola: Lack of Assistance Undermines Sustainable Return of IDPs, Oslo, 2004; Human Rights Watch (HRW), Some Transparency, No Accountability: The Use of Oil Revenue in Angola and its Impact on Human Rights, New York, 2004. 53. ICG, 'Rebuilding Liberia: Prospects and Perils', ICG Africa Report No. 75, Brussels, 2003. See also Reno, this issue. 54. The plan was replete with 'irregularities such as under-pricing and buying real estate under the guise of rebuilding the city', i.e., predatory expropriation. The Hariri government was suspected of having initiated an anti-corruption administrative reform only to pressure coalition politicians and MPs to approve the plan. The plan was approved and no high-ranking official or politicians faced sanctions. See, Richard W. Carlson, 'Mr. Hariri Goes to Washington', The Weekly Standard, Vol.8, No.34, 12 May 2003; Lara Marlowe, 'Up From Despair', Time, Vol.147, No.3, 15 Jan. 1996; Abeer El-Gazzawi, 'Lebanon's Financial Crisis: A Recipe for Disaster?', World Press Review, 24 June 2002. 55. See James Boyce and Madelene O'Donnell, Peace and the Public Purse: Economic Policies for Postwar Statebuilding, Boulder, CO: Lynne Rienner, 2007; Tony Addison and Alan Roe, Fiscal Policy for Development: Poverty, Reconstruction and Growth, Basingstoke: Palgrave, 2004. 56. Jonathan Clayton, 'Mining Groups Face Congo Shake-up after Review', The Times, 8 Nov. 2007. 57. The initial contract gave Mittal Steel 'complete freedom to set the price of the iron ore', which affected the amount to be paid in taxes to the Liberian government. See Global Witness, Heavy Mittal? A State within a State: The Inequitable Mineral Development Agreement between the Government of Liberia and Mittal Steel Holdings NV, London: Global Witness, 2006, p.7. Mittal's parent was domiciled in Netherlands Antilles, and later in the 'tax-friendly' Swiss canton of Zug; its Liberian subsidiary was domiciled in Cyprus; on GEMAP, see Reno, this issue. 58. Le Billon (see n.13 above), pp. 413–26; Willem Van Schendel and Itty Abraham, Illicit Flows and Criminal Things: States, Borders, and the Other Side of Globalization, Bloomington, IN: Indiana University Press, 2005. 59. A detailed discussion of anti-corruption initiatives in 'post-conflict' countries falls beyond the scope of this article (see n.5 above). 60. Tax Justice Network, 'Corruption and the Offshore Interface', 2006 (at: www.taxjustice.net/cms/front_content.php?idcat=100). 61. Klein (see n.36 above). 62. M. Carnahan, Options for Revenue Generation in Post-conflict Environments, New York and Amherst, MA: Centre on International Co-operation and Political Economy Research Institute, 2007; Morris Szeftel, 'Clientelism, Corruption and Catastrophe' Review of African Political Economy, Vol.27, No.85, 2000, pp.427–41. 63. R. Cooksey, 'Aid and Corruption: A Worm's-eye View of Donor Policies and Practices', paper at the 11th International Anti-corruption Conference, Seoul, South Korea, 26–29 May 2003. 64. Le Billon (see n.5 above), pp.678–98. 65. Naylor (see n.34 above); Raymond Baker, Capitalism's Achilles Heel. Dirty Money and How to Renew the Free-market System, Hoboken, NJ: John Wiley, 2005; Tax Justice Network, Tax Us if You Can. The True Story of a Global Failure, London, 2005. 66. See Aceh Conflict Monitoring Update (at: www.conflictanddevelopment.org)

Democracy · Development economics · Economic system · Economics · Language change · Liberalization · Peacebuilding · Political economy · Political science · Politics · Law · Peacebuilding and International Security · Political Conflict and Governance · Politics and Conflicts in Afghanistan, Pakistan, and Middle East · Public Administration

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