2. Institution building to prevent corruption

In many ways, Mozambique is a "transition country" moving from socialism to capitalism, like those of Eastern Europe, and a World Bank study of corruption in Eastern Europe provides a useful background. The authors develop a distinction between two types of corruption, "administrative corruption" and "state capture" (Pradhan 2000:2,3, 9, 17).

"Administrative corruption" relates to the implementation of existing laws, rules, and regulations and most commonly involves paying a bribe, either to obtain special treatment or simply to encourage an official to carry out their job. Also, "state officials can simply misdirect public funds under their control for their own or their family's direct financial benefit."

"State capture" involves taking control of institutions, such as ministries, the judiciary or regulatory agencies, to obtain illicit equity stakes, informal control, and other ways of extracting rents, including "the sale of court decisions to private interests and the mishandling of central bank funds". It often involves the overlapping business and political interests of state officials, "which has been a particularly prominent characteristic of many transition countries." The "underestimation of overall state capture may be particularly high in countries with kleptocratic political regimes, where institutions of the state have been used to serve the interests of a particular leader and his broader circle," notes the World Bank study.

2.1 Mozambique wasn't always corrupt …

Any discussion of corruption in Mozambique should start from the death of Francisco Langa in May 1980. A military leader in the liberation war, he was elected to the Frelimo Central Committee and became head of the Centre for Support to Refugees and Liberation Movements, mainly from Zimbabwe. An unprecedented Central Committee statement said he had been caught embezzling funds, and shot and killed himself because he was overcome with shame and could no longer face his comrades (AIM 1980; Hanlon 1991:231).

I was working in Mozambique at the time and can testify from personal experience to the honesty and integrity of the civil service and leadership. The bureaucracy may have been inefficient, but I was never asked for a bribe or payment. There were no stories of high level or petty corruption; Langa's behaviour was highly unusual and would have been seen as totally shameful.

Perhaps surprisingly, the World Bank in its study of Eastern European transition economies admits that these countries were less corrupt in the central planning era. The Bank argues that the Communist Party controlled the behaviour of public officials using a mix of mutual oversight, incentives and repression. It adds that central planning "did place certain boundaries on corruption." (Pradhan 2000:26)

This was true in Mozambique. But equally, or more, important were idealism and political will. In the first decade of independence, Mozambican officials really did believe they were building a better country, and that the integrity of the state was important.

2.2 … but it is now

Both administrative corruption and state capture are now ubiquitous in Mozambique. A survey by Ética Moçambique (2001) of 1200 people showed that 45% said they had been victims of corruption in the past six months. Of those, 31% paid less than $6, 45% paid $6-60, and 22% had to pay $60-600, which is a substantial amount of money in Mozambique where the GDP per capita is only $300. The most common demands for money were in health (30%), education (27%), and the police (21%). Bribes are not just financial; almost 5% of respondents said that they had been required to "sleep with a government official". In most cases, the issue is administrative corruption; bribes were paid to obtain something to which the person was entitled - in one case, to obtain anaesthetic during an operation. Others were to gain preferential treatment, such as a school place or passing exams.

State capture is also now obvious. Corruption in the banking system has involved senior government officials (Section 3.3 and Hanlon 2002a). The statement of Attorney-General Joaquim Madeira (2002) to parliament gave other examples. The Ética Moçambique survey also showed state capture, with 0.4% (probably 2 people in the survey) paying more than $60,000 in bribes. What the report called "grand corruption" included obtaining bank loans larger than would be justified under normal conditions, winning tenders, preventing prosecutions for drug dealing and money laundering, and gaining a favourable audit.

In private, some Mozambicans justify state capture on the grounds that white and Asian-origin Mozambicans gained privileged positions during the colonial era and gain preferentially from globalisation now, and that a new black bourgeoisie needs space for primitive accumulation which it can only do through the state (Hanlon 2002b: 114).

2.3 How to respond

Baroness Amos, Under-Secretary in the British Foreign and Commonwealth Office (FCO) with responsibility for Africa, set out the British response in a statement to an FCO conference 20 May 2002 on "Tackling Corruption in Africa". She said "our approach is holistic" and "aims to build the capacity of institutions" (Amos 2002). The World Bank says it "addresses corruption in systemic terms. It is not the Bank's role to identify and prosecute individual offenders, but rather to address the various aspects of policy and institutional reform that are likely to be critical in reducing corruption." (World Bank 2002a)

NORAD, the Norwegian aid agency, in its "Good Governance and Anti-Corruption Action Plan", explicitly argues that experience shows that "investigation and prosecution of corruption cases require large personnel and other resources, which implies costs well above what poor developing countries can afford. Strong emphasis must therefore be placed on preventing corruption, by raising public awareness, and by reducing the scope for corrupt behaviour." It then sets three objectives, assisting good governance, increasing awareness of corruption in "aid administration", and sharing experiences in preventing and combating corruption (NORAD 2000: 19-20).

In Mozambique, the World Bank and donors are putting $85 mn into a 10-year public sector reform project. Meanwhile the government is moving to try to reduce administrative corruption, through individual actions by governors and ministers against corrupt middle level officials (MPPR 25:5, 27:7).

Emphasis on capacity building and institutional reform sounds sensible. But it is inadequate, and it means donors are rejecting appeals to take action against growing present-day corruption, while pushing a decade-long programme of institutional change. In a closed meeting earlier this year, one of the most prominent Mozambicans campaigning against corruption said "we appealed to donors to put pressure on government to pursue the high level people whose names are known and who were involved in bank corruption. The government is putting money into plugging the holes in the banks, and 45% of that comes from donors. I asked them - I asked the ambassadors: 'Why do you refuse to put pressure on the government?' If you put donor money into the budget and don't look to see where it goes, you are supporting corruption."

British, Norwegian and World Bank approaches aim at reducing administrative corruption and corruption involving aid, but they ignore state capture and they ensure the elite more years of impunity. Even the World Bank's own Eastern Europe study admits this will not work: "an important part of the problem [of persistent corruption] lies in the tendency to focus exclusively on the state and, in so doing, limit our anti-corruption strategy to standardized technical solutions." (Pradhan 2000:1)

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