In Transparency International’s Corruption Perceptions Index 2014, Armenia ranked 94th out of 174 countries.
“The [Armenian] government and parliament should ban members of parliament and senior public officials from engaging in business activities. Sanctions for such actions should be introduced, including for those who are aware of such practices but do not report them.” This was one of the key recommendations that Transparency International (TI) issued to the government of Armenia in its newly published report, “The State of Corruption: Armenia, Azerbaijan, Georgia, Moldova and Ukraine” on July 2.
Corruption remains a crippling problem in the former Soviet space — it threatens economic development and political stability and serves to also threaten the credibility of governments and state officials.
The TI report notes that while anti-corruption laws in all five countries included in the report have been adopted “the capture of important institutions by powerful interests is seriously undermining the effective enforcement of these laws.” National chapters of the organization in all five countries included in the report conducted in-depth research on the strengths and weaknesses of more than 60 institutions commissioned with preventing corruption.
In the study, it was found that oligarchs in Armenia present a particular feature of corruption and found that they enjoy the fruits of a shadow economy estimated to account for about 35 percent of Armenia’s GDP.
New report by Transparency International.
“Patronage networks and a lack of clear separation between private enterprise and public office act as an important barrier to effective anti-corruption efforts,” the report states and goes on to note that while 21 percent believe that the government has been effective in anti-corruption reforms, 82 percent of Armenians believe that corruption in the public sector is a serious issue. The judiciary and civil service are sectors are perceived to be most affected by corruption.
Armenia’s political landscape is dominated by unaccountable elites. According to the report “the convergence of political and business elites, the dominance of monopolies, and insufficient checks and balances between the branches of government” is prevalent. Furthermore, a powerful president’s office, ruling party and numerous members of parliament who have strong connections to the country’s private sector are all impediments to progress.
“The president, both former prime ministers and the incumbent prime minister, as well as the majority in the parliament, are members of the same party [Republican Party of Armenia — editor]. Thus the party, the executive and the president can largely be considered one and the same, leading to overreach into the affairs of the state by the president who has a final say on almost all important matters in the country,” states the reports and goes on to note that in the absence of solid checks and balances, the president is thereby virtually unaccountable to any other body.
In April 2014, Armenia’s government approved a new anti-corruption strategy that was drafted between December 2013 and March 2014, but has yet to be adopted. Among the approaches recommended in the strategy are prevention of conflicts of interest, a more effective asset declaration system for public servants and high-ranking officials, improvement of the merit-based appointment system for civil servants, and enhanced public sector fiscal transparency and disclosure of non-classified information.
Transparency International notes that “ensuring that the new strategy is implemented without delay is critical and will be a key test of the government’s political will to fight corruption.”
The same condition exists in the country’s judiciary. About 70 percent of Armenians consider that the justice system is “not free from governmental influence.” Thereby, courts time and again fail to prosecute corruption offenses. “[D]uring the first half of 2013, only two cases were adjudicated for bribe-taking, and only six files for bribery were opened. In total, for all 31 types of corruption offenses, only 48 cases were adjudicated in the same period,” the report says.
Its second key recommendation to the Armenian government is to “significantly speed up the prosecution rate of corruption offenses, giving greater priority to prosecuting high-level officials in order to build trust among citizens in the judiciary’s commitment to fighting corruption.”
“Public officials and members of parliament have substantial direct and indirect control over important private businesses, often through hidden partners or close relatives and friends, limiting free market competition and discouraging foreign investment.”
While the state of corruption remains grim, TI notes that there are some promising signs in oversight institutions. The chamber of control, electoral management body and the human rights defender perform relatively well “thanks to a supportive legal framework and generally adequate resources.” The report notes that the human rights defender is seen as the strongest institution in Armenia, and has been “praised for its courage in resisting pressure from state institutions.”
The media, civil society and the business sector are seen as the weakest institutions in Armenia. “There are concerns about the capacity and sustainability of CSOs in Armenia, given the treatment of CSOs as for-profit organizations for tax purposes. There has also been an increase in clampdowns on civil activists.” the report states. However, once again, TI does see some hope due to a number of recent civic initiatives “indicating a stronger voice emerging from the non-state sectors of society,” citing the “Dem Em” (I am Against) movement against privatization of the country’s pension system.
Its third and final recommendation thereby is to ease the tax regulations for CSOs in order to build capacity and sustainability of civil society.
In Transparency International’s Corruption Perceptions Index 2014, Armenia ranked 94th out of 174 countries, with a score of 37 on a scale from 0 (highly corrupt) to 100 (very clean).
Transparency International is a global movement to ensure a world in which government, business, civil society and the daily lives of people are free of corruption. It has more than 100 chapters worldwide and an international secretariat in Berlin.
