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Where there is no law, but every man does what is right in his own eyes, there is the least of real liberty
Henry M. Robert

Ukrainian enterprises spend 6.5% of average annual income on bribes

16 November, 1999 - 00:00

The average bribe level in post-Soviet countries is almost twice as that in Central and Eastern European states. This information is provided in a recently published report on the economic performance of enterprises in the former socialist countries, prepared by the European Bank for Reconstruction and Development together with the World Bank, in which over 3,000 enterprises from 20 transition economy states were surveyed.

According to the survey, average bribes paid by ex-USSR enterprises account for 5.7% of their average annual income, while in the Central and Eastern European states it is 3.3%. The survey says the largest amounts are spent on bribes by Georgian enterprises: 8.1% of the average annual corporate income. In Russia, bribe expenditures of enterprises account for 4.1% of their annual earnings, while in Ukraine it is 6.5%.

Simultaneously, Interfax-Ukraine reports, survey authors also note a high level of bribery in the countries successfully carrying out market reforms. For example, in Hungary, 31.1% of the polled enterprise employees admitted to having paid bribes, while in Poland the same answer was given by 32.7% of company representatives polled.

“Every day I have to spend about $50 on bribing bureaucrats in the district administration, tax authorities, as well as law-enforcement officers,” the owner of a small Kyiv flea-market told The Day. “I have to pay those who help me resolve one organizational problem or another. I can say the same about traffic policemen, who often come out on the road to line their pockets. It is impossible to do business in today’s Ukraine without paying bribes.”

Yet, chairman of New Formation Business Association coordination council Vyacheslav Kredisov is more optimistic: “I am certain that in this country one can work without bribery. Everything depends on the decency of people occupying various posts,” he told The Day, “But to eliminate corruption, one must, above all, improve the law in such a way that bureaucrats cannot interpret it however they want. And, of course, normal salaries must be paid civil servants. For it is crystal-clear that a civil servant, who signs a document about thousands of dollars but earns no more than 200 hryvnias a month, will sooner or later fail to resist the temptation of demanding a bribe. The same applies to law-enforcement officers. A Ukrainian traffic policeman will wink at a traffic offense for 5 hryvnias, a Chicago cop, who earns about $1000 a month, will be afraid to lose his job and will punish the offender in compliance with the law.”

P. S. How can we break the vicious circle of bribery? How can we destroy the “money-goods-money” formula adapted by bureaucrats for their own needs? The Day editors invite the readers to express on the newspaper pages their opinion on corruption and probable steps to eliminate it. Please send your letters by ordinary or e-mail, marked “Bribes” to pravo@core.day.kiev.ua.

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