U.S. bullies nations into awarding contracts

[Ulhas Joglekar]

22 January 2000
U.S. bullies nations into awarding contracts
WASHINGTON: India was among 14 emerging market economies subjected to
diplomatic pressure by the United States to grant lucrative business
contracts to American corporations, according to a Gallup poll released
here.
The poll, commissioned by Transparency International (TI), a global
coalition seeking to root out corruption, said almost two-thirds of 779
private sector leaders surveyed in these 14 countries said they associate
the U.S. most with exploiting its superpower status, dumping laws or other
"unfair business advantages" to secure contracts abroad for its companies.
Frank Vogl, vice chairman of TI, said at a news conference that the U.S. is
seen as "exerting its superpower status to bully" other countries.
"Many European countries argue that's why bribery is the only way to get the
deals," he said.
About one-third of respondents said Japan and France are also likely to use
government influence to secure contracts for their corporations.
In response to a question on which governments were most likely to resort to
such practices, the U.S. was the clear winner by a wide margin with 61 per
cent, while France and Japan tied for second place with 34 per cent followed
by China (including Hong Kong) with 32 per cent and Germany with 27 per
cent.
Sweden, Australia and Switzerland came out with the best ranking among the
19 leading exporters listed to use the least diplomatic pressure to win or
retain business in the 14 developing countries, which between them account
for more than 60 per cent of total imports of all emerging market economies.
Besides India, private sector executives were polled from Indonesia, the
Philippines, South Korea and Thailand from the Asia/Pacific region;
Argentina, Brazil and Colombia from Latin America; Hungary, Poland and
Russia from Europe; and Morocco, Nigeria and South Africa from the African
continent.
According to the survey, the most prevalent means governments use for
gaining advantages for business were diplomatic or political pressure (59
per cent), commercial pressure and/or dumping and price manipulation (49 per
cent), and financial pressure through tariffs, customs barriers and
subsidies (45 per cent).
The findings suggested that executives in the 14 emerging market economies
justified bribery as a counterweight to U.S. diplomatic pressure.
Saying "I don't know whether that is unethical," Vogl noted the perception
among the private sector executives polled was that the U.S. was the leader
in pressuring governments on behalf of its companies.
The U.S. State Department offered no comment on the findings of the
survey, but a Commerce Department official said that American embassies were
only doing their job in trying to drum up business for U.S. companies "and I
don't see anything wrong with that."
The poll found infrastructure projects, particularly public works and
construction, weapons and energy industries, including petroleum, to be the
most susceptible to bribery.
Bribery and corruption was increasing in their countries, the respondents
said, chiefly because of low salaries for government workers and officials,
government secrecy and bureaucratic procedures for selling
state-ownedassets.
Peter Eigen, chairman of TI, warned that "bribery by international companies
is weakening national economies". He said the scope of "bribe-paying by
international corporations in the developing countries of the world is
massive."
"Only a fraction of the international business executives questioned," he
noted, "indicated an awareness of the new convention or corporate plans to
comply with the new international anti-corruption rules."
The anti-bribery treaty was enacted last year by the Organisation for
Economic Cooperation and Development (OECD), a Paris-based group of 29
industrialised countries, and was touted as a tool that would be bully
pulpit to inhibit companies from bribing public officials to get business
deals through.
The U.S. led the way in getting the treaty enacted, with Clinton arguing
that it was imperative to protect American companies from corrupt foreign
competition as in some nations companies were even allowed to get tax breaks
on promotional expenditures paid ostensibly as bribes to secure contracts.
Under U.S. laws, American companies are barred from using any form of
bribery to get contracts overseas.
Vogl said the fact that international efforts to root out corruption had
attracted scant attention, as proved by the survey, "should be a
wake-upcall." (India Abroad News Service)
For reprint rights: Times Syndication Service
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