OK, “best of times” and “worst of times” would be a gross exaggeration. But still, when I consider recent developments in the fight against corruption in Latin American and Southeast Asia, it seems that these two regions are moving in quite different directions. And the directions are a bit surprising, at least to me.
If you’d asked me two years ago (say, in the summer of 2014) which of these two regions provoked more optimism, I would have said Southeast Asia. After all, Southeast Asia was home to two jurisdictions with “model” anticorruption agencies (ACAs)—Singapore and Hong Kong—and other countries in the regions, including Malaysia and especially Indonesia, had established their own ACAs, which had developed good reputations for independence and effectiveness. Thailand and the Philippines were more of a mixed bag, with revelations of severe high-level corruption scandals (the rice pledging fiasco in Thailand and the pork barrel scam in the Philippines), but there were signs of progress in both of those countries too. More controversially, in Thailand the 2014 military coup was welcomed by many in the anticorruption community, who thought that the military would clean up the systemic corruption associated with the populist administrations of Thaksin Shinawatra and his successor (and sister) Yingluck Shinawatra—and then turn power back over to the civilian government, as the military had done in the past. And in the Philippines, public outrage at the brazenness of the pork barrel scam, stoked by social media, and public support for the Philippines’ increasingly aggressive ACA (the Office of the Ombudsman), was cause for hope that public opinion was finally turning more decisively against the pervasive mix of patronage and corruption that had long afflicted Philippine democracy. True, the region was still home to some of the countries were corruption remained pervasive and signs of progress were scant (such as Vietnam, Laos, Cambodia, and Myanmar), but overall, the region-wide story seemed fairly positive—especially compared to Latin America where, aside from the usual bright spots (Chile, Uruguay, and to a somewhat lesser extent Costa Rica), there seemed to be precious little for anticorruption advocates to celebrate.
But now, in the summer of 2016, things look quite a bit different. In Southeast Asia, the optimism I felt two years ago has turned to worry bordering on despair, while in Latin America, things are actually starting to look up, at least in some countries. I don’t want to over-generalize: Every country’s situation is unique, and too complicated to reduce to a simple better/worse assessment. I’m also well aware that “regional trends” are often artificial constructs with limited usefulness for serious analysis. But still, I thought it might be worthwhile to step back and compare these two regions, and explain why I’m so depressed about Southeast Asia and so cautiously optimistic about Latin America at the moment.
I’ll start with the sources of my Southeast Asian pessimism, highlighting the jurisdictions that have me most worried:
- Hong Kong: The Hong Kong Independent Commission Against Corruption (ICAC) is probably the most famous ACA in the world, and has served as a model for countless others. Its reputation is well-deserved. And at least for a while, the ICAC had appeared to maintain its sterling reputation even after Hong Kong reverted to Chinese sovereignty in 1997. But there are troubling signs that this may be changing. In a development that I’m frankly surprised hasn’t gotten that much press and attention from anticorruption activists, last month the Hong Kong government removed the ICAC’s head of operations, Rebecca Li Bo-Lan, right at the time that the ICAC was investigating Hong Kong’s Beijing-backed chief executive, Leung Chun-Ying. The ICAC Commissioner, Simon Peh Yun-Lu, insisted that this decision (which he emphasizes was his alone) was simply because Ms. Li—a 30-year veteran of the ICAC who commanded widespread respect among her colleagues—was not up to the job. (It’s perhaps worth noting here that Mr. Peh was a former Commissioner of the Immigration Department, with no prior experience with the ICAC or anticorruption work, who was personally selected by Mr. Leung.) How many people out there think that it was Ms. Li’s lack of competence, rather than political pressure from Mr. Leung and/or Beijing, that explained her dismissal? For how much longer can we or will we continue to describe the ICAC as the ACA gold standard?
- Malaysia: As we’ve already discussed on this blog, the so-called 1MDB scandal has badly tarnished not only Malaysia’s reputation as a (relatively, by regional standards) clean jurisdiction, but has also tarnished the reputation of the effectiveness and independence of its ACA (the Malaysian Anti-Corruption Commission, MACC). After the discovery of approximately $781 million in Prime Minister Najib Razak’s personal bank account, initial reports suggested that the money might have been embezzled from a government development fund called 1MDB. The MACC investigated—but then, in a classic “nothing to see here” moment, the new Malaysian Attorney General (who had replaced the former AG, who had been investigating the allegations but stepped down, allegedly “for health reasons”) announced that there was no embezzlement from 1MDB, and the money in the PM’s account was an allegedly lawful political campaign donation from the Saudi royal family. But this hasn’t stopped Swiss and US authorities from investigating, culminating in the dramatic announcement last month that the US Department of Justice’s kleptocracy initiative was moving to seize over $1.3 billion in assets allegedly purchased with money embezzled from 1MDB by high-ranking officials in the Malaysian government and cronies of the Prime Minister. The Malaysian government’s principal response has been to point out that the Malaysian investigation found no wrongdoing (ha!), and to enact a draconian new “security” law to crack down on domestic critics.
- Indonesia: Indonesia’s ACA, the KPK, has earned both international praise and widespread domestic support for its aggressive and surprisingly effecting action against corruption. Despite its precarious institutional position, it has thus far been able to resist sustained resistance, and even brazen attacks, from its targets, especially the police force and the legislature. It has survived largely due to strong public support, which the KPK has itself succeeded in cultivating through shrewd strategic decision-making and good relations with the media and civil society. And the KPK has probably benefited from the crude, ham-fisted tactics that its opponents have deployed so far. But the KPK’s opponents have grown more numerous—especially in the legislature—and more sophisticated. As Jessica has discussed on this blog, legislative “reforms” currently under consideration are actually measures that would undermine the KPK’s effectiveness; indeed, that’s almost certainly the point of said reforms. President Joko’s precarious political position, coupled with Indonesia’s economic weakness and the perception (right or wrong) that overly aggressive anticorruption enforcement is chilling necessary investment projects, means that the KPK is in a very precarious position.
There are thus reasons to worry that several of the jurisdictions in Southeast Asia that had developed ACAs viewed either as models for the world (as in Hong Kong), or at least as examples of successful replication of the Hong Kong model in more challenging environments (as in Malaysia and Indonesia), are now revealing the limits of those institutions when faced with high-level political resistance. As for Thailand and the Philippines, the enthusiasm that many in the Thai anticorruption community had for the military government seems to be dissipating fairly quickly as the military government has lingered on for far longer than expected (over two years now), and has been dogged by its own accusations of corruption. And in the Philippines, anger over corruption (and other sorts of crime) has indeed had a political impact—but the result has not been the election of a sensible reformist government, but rather the election of law-and-order demagogue Rodrigo Duterte, whose aggressive zero-tolerance approach, though superficially appealing, is likely to be both destructive and counterproductive (as Bea has persuasively argued on this blog—see here and here).
So things aren’t going so well in Southeast Asia, a region that only two years ago I thought was turning a corner and was poised to make substantial progress. Meanwhile, in Latin America, while we shouldn’t get carried away with unjustified enthusiasm, there are a number of encouraging signs:
- In Guatemala, corruption investigations by the UN-sponsored anti-impunity entity known by its Spanish acronym CICIG succeeded in triggering first widespread public protests against high-level corruption (the so-called “Guatemalan Spring”) and then the resignations and indictments of both the former President and Vice President. Given Guatemala’s sad history of high-level impunity (for war crimes and other human rights violations, as well as grand corruption), the significance of this breakthrough is hard to exaggerate. The CICIG model has sparked enthusiasm and partial emulation in other countries in the region, such as El Salvador and Honduras, and though the currently proposed CICIG-like entities in those countries still fall short in many ways, the pressure to adopt this model is certainly encouraging.
- In Brazil, the so-called Car Wash investigation into corruption at the state-owned oil giant Petrobras (and beyond) has exposed systemic corruption throughout Brazil’s elite political class—corruption which has been going on for decades, but which has only now been brought to light by the dogged and determined efforts of a group of prosecutors and judges, with the broad support of a large segment of the Brazilian public. There are many legitimate questions about the ultimate effect of this investigation, as well as reasonable concerns about process and tactics, but it’s hard to gainsay the fact the significance of this investigation, which was unthinkable only a few years ago.
- In Argentina and Peru, recent elections suggest a possible turn away from the populist, patronage-based parties that have dominated so many of the region’s democracies for the past several decades (and which have perpetuated both petty and grand corruption). In Argentina’s presidential election last year, voters rejected the Peronist candidate who had been endorsed by former President Cristina Kirchner (embroiled, like many of her predecessors, including her husband, in serious corruption scandals). And in Peru, Keiko Fujimori—the daughter of former president (and corrupt human rights abuser) Alberto Fujimori—was narrowly defeated by charisma-challenged economist Pablo Kuczynski, a result seen in many quarters as an encouraging sign that a (bare) majority of Peruvian voters reject the legacy of the Fujimori regime.
- To the north, in Mexico, 2015 saw the adoption of a set of constitutional amendments that create new institutions for addressing corruption; those amendments are set to be implemented through new legislation adopted this year. As Courtney pointed out in her post earlier this year, although the new amendments are far from perfect—and much depends on the details of the implementing legislation—the amendments get a number of things right, and seem to represent significant progress. And, complementing the constitutional amendments, Mexican civil society has taken full advantage of an earlier constitutional reform that allows citizens to introduce bills to the legislature, collecting enough signatures to compel the legislature to consider a package of significant anticorruption reforms (dubbed “Ley 3de3”) focused on disclosures by public servants of their assets, their private interests, and their tax returns, as well as stronger protections for whistleblowers.
Of course, all the progress we’ve seen in the region is incomplete, fragile, and easily reversible. And there are plenty of countries in the region where the last few years have not provided much reason for optimism of any kind. Still, when I think of how I would have assessed the overall state of anticorruption progress in Latin America two years ago, and compare that to how things look now, I can’t help but feel a sense of cautious optimism.
I should say again that I recognize that comparing entire regions the way I have in this post is inevitably oversimplified, perhaps even gimmicky. And since I’m not a true expert in any of the countries I’ve discussed above, let alone all of them, it’s quite possible that the real experts will find some of my optimism and/or pessimism misplaced. But still, when looking back over developments around the world over the last couple of years, and comparing what’s happened to what I’d have predicted in the summer of 2014, it’s notable how wrong I was. I suppose if I were to try to draw lessons from this, I’d emphasize three things: (1) Don’t be too confident in the apparent strength of anticorruption institutions, as these institutions are more vulnerable than they may appear. (To repurpose the standard investment fund caveat, “past performance is no guarantee of future results.”) (2) Don’t be too pessimistic either: Even when a system seems mired in pervasive and intractable corruption, as legal and political circumstances can change quickly for the better as well. (3) Don’t listen to me—my predictions are usually wrong.