Minister Tuomioja’s speech in Anti-Corruption Seminar

Discussion on Global Anti-Corruption Challenges and Possibilities in public finances and private business, 26 April 2013.

Opening remarks by the Minister for Foreign Affairs, Mr. Erkki Tuomioja.

Ladies and Gentlemen,

I am honored to welcome you all today to discuss the important theme, namely the Global Anti-Corruption Challenges and Possibilities in public finances and private business. Let me also warmly welcome Mr Cobus de Swardt, Managing Director of Transparency International and his team to Helsinki and to our Ministry.

The idea of anti-corruption entered into international development discourse in the 1990s, defining corruption as a major global problem, being “sand for the wheels of commerce” and affecting development negatively.

There are a variety of reasons for a changed perspective on corruption. The political climate was favorable to international cooperation. During the same time, international trade grew and the world globalized. There was a need to correct market distortions such as corruption, by creating common rules for commerce.

International conventions were agreed upon to curb corruption around the turn of the millennium, for instance the United Nations Convention against Corruption is the only legally binding universal anti-corruption instrument. It entered into force in 2005, taking into account public and private sector corruption.

Today, the anti-corruption movement is as local as it is global; it has actors from the civil society to private companies, organizations and governments around the world. One of the most known NGOs is our long-term partner Transparency International, TI.

TI broke the taboo of corruption and raised it to the global agenda. But TI also changed our perception that corruption is only a problem of developing countries. It is a paradox that people who live in a country full of diamonds and oil suffer from poverty. The majority of the world’s poorest people live in resource-rich countries. The oil and diamond revenues haven’t transformed into positive development outcomes. National revenue collection, including taxation, is at the core of the corruption discussion together with illicit financial flows and tax havens.

Since corruption is one of the major impediments to the realization of human rights, it is important to ask: How can human rights principles help in fighting corruption? Human rights principles and institutions are essential components of successful and sustainable anti-corruption work. First, these efforts are likely to be successful when they approach corruption as a systemic problem rather than a problem of individuals.

Second, the battle against corruption, similar to human rights projects, is often a long-term process requiring profound societal changes, which include a country’s institutions, laws and culture.

The efforts of the judiciary and the rule-of-law system are key in this discussion. The relevant laws have to be adopted and the existing legal framework needs to be fully implemented.

Transparency and accountability are paramount to successful anti-corruption work. Some of the measures that can enhance transparency and accountability and contribute to sustainable anti-corruption measures are laws ensuring the public’s access to information on governmental processes, decisions and policies, as well as institutional reforms.

An engaged civil society and media that value and demand accountability and transparency are vital in addressing corruption. Lessons can be learned from the experience of human rights movements in raising the civil society’s awareness of the adverse consequences of corruption and in building alliances with state institutions and the private sector in support of anti-corruption efforts.

Illicit financial flows. Globalisation has been beneficial in many ways. However, the structures that facilitate legitimate businesses and international financial transactions are also used for illicit purposes: money-laundering, generating illicit flows out of development countries, paying bribes or evading taxes. These mechanisms create incentives for corrupt behavior in developing and developed countries and need solutions at local and international levels.

Despite losses in tax revenues, advanced market economies may enjoy net benefits from illicit flows, as laundered money from elsewhere gets to be invested in financial centres located in rich economies. By contrast, these flows have a devastating impact on poorer countries.

Corruption in public procurement is an important obstacle to development but also distorts the economies in the developed world. Seeking profits can provide incentives to engage in corrupt activities. Corruption can also fuel the growth of excessive and discretionary regulations. It can lead to disregard of laws and procedures, and to a lower level of trust and confidence in government.

Ladies and Gentlemen,

Our ministry is honored to co-organize this meeting with the Transparency International and its national chapter in Finland. We believe in multi-stakeholder co-operation, between states, civil society and business as a promoter of successful policies and mechanisms against corruption. We have promoted together the monitoring mechanism of the UN Convention against Corruption. We hope that our financial contribution to TI and its chapters has helped the human rights defenders to fight corruption both locally and at international level.

Thank you.