INDICATIONS from President Emmerson Mnangagwa’s government currently show that he has taken a tough stance against corruption, a cancer that has done significant damage to the country’s socio-economic fabric and induced a lot of suffering to ordinary citizens since independence in 1980.
BY VENERANDA LANGA
Transparency International Zimbabwe (TIZ) coordinator Farai Mutondoro told a recent TIZ discussion on transparency and accountability in Harare that if the country was open for business as parroted by Mnangagwa, there was need to combat corruption at State enterprises and parastatals.
He said there has been a lot of filthy lucre around issues of issuance of tenders and there was need to put in place and implement measures that ensured investors were not asked for bribes when they tried to open companies as well as a mult-stakeholder stance against corruption.
Zimbabwe is ranked number 157 out of 180 in the Corruption Perceptions Index 2017 by Transparency International, and it is considered as one of the most corrupt countries in Sub-Saharan Africa.
Mutondoro, who is a researcher, in 2017 did a study which showed that 74, 3% of respondents thought corruption has been increasing, with 68, 5% saying government was ineffective in fighting it.
Around 77, 4% Zimbabweans from the sampled population were reported to have said they were asked to pay bribes for services rendered, with the police topping the list, followed by officials at various local authorities, the education sector, Vehicle Inspection Department, Registrar-General’s office, health institutions and the judiciary.
“In the education sector, lecturers and teachers were said to be selling examination papers to students in return for money or sex,” Mutondoro’s research revealed.
Johannes Mudzengerere, a representative from the small and medium enterprises sector (SME) , said the sector was one of the hardest hit by corruption especially when they wanted to participate in tender processes.
“We meet several challenges in that when we participate in tender processes, it is difficult to win the tenders because of inherent corruption by government and local authority officials when handling tenders. It is impossible to get business if you do not part with one or two dollars to grease the hands of officials, but SMEs can only grow by getting tenders,” he said.
“The only SMEs that are growing are otherwise doing so at an expense and it is actually increasing their cost of doing business.”
He said it was a mammoth task for SMEs to pay taxes due to the liquidity crunch in the country, adding that they ended up buying cash on the parallel market in order to purchase raw materials.
“We cannot get money from the banks, and we end up buying it from the streets, which is corruption. We also have to comply with Zimbabwe Revenue Authority taxes, and in most cases SMEs end up cooking up books of accounts for survival, and that is corruption. Due to the high costs of running businesses in Zimbabwe, SMEs end up employing casual workers. To us the main challenge is costs through the value chain which is littered by a lot of corruption,” he said.
Economist Prosper Chitambara said corruption was the major factor hindering ease of doing business in Zimbabwe, with empirical global evidence showing that corruption raised the costs of doing business by over 20%.
Chitambara said the key drivers of corruption were excessive regulations and cumbersome procedures, bureaucracy, onerous tax regimes, a weak economy and underpaid civil service as well as lack of ethical leadership resulting in bribery.
He said the policy options to fight corruption included the need to build strong, credible, accountable political institutions, undertaking key institutional reforms at SEPs (State Enterprises and Parastatals), embracing e-governance, reducing bureaucracy and implementing extractive industry transparency initiatives.
“Corruption is a major binding constraint to doing business, and it is the fifth most problematic factor for doing business in Zimbabwe. Global research shows that on average, the costs of doing business increase by more than 20% as a result of corruption.
“For Zimbabwe to come up with appropriate policies to curb corruption, we need to appreciate its key drivers, which include excessive regulations and procedures governing doing business in Zimbabwe. They are cumbersome and it is fertile breeding grounds for corruption because corruption greases the oil of businesses by circumventing cumbersome policies,” Chitambara said.
He said State capture and red tape hindered ease of doing business, adding that in Zimbabwe it took 90 days to register a business, yet in other countries like Singapore it took only 10 hours.
Chitambara said an onerous tax regime and weak institutions like State enterprises and parastatals (SEPs) — burdened by lack of accountability and transparency — also bred corruption.
“An environment where there is lack of ethical leadership also breeds corruption, as well as poor economic conditions and poorly paid public officials,” he said.
However, Chitambara said there were policy options available for Zimbabwe to combat corruption. He said these needed political will and commitment, as well as ethical leadership.
“There is need to build strong, credible and accountable political and economic institutions so that they deal effectively with corruption. There is also need to undertake key institutional reforms at SEPs to ensure they comply with principles of corporate governance,” he said.
Chitambara said e-government was also another option, adding that in countries like Singapore everything is done electronically, with CCTV exposing all activities done behind closed doors.
“There is need to streamline doing business regulations and procedures to reduce bureaucracy and red tape which attracts petty bribery. There is also need to have an efficient public service and to adopt a biometric payroll that can weed out ghost workers in the civil service,” he said.
The economist observed that to plug leakages and illicit financial flows (IFFs) in the minerals sector, there is need for government to implement the extractive industry transparency Initiative as government was losing about $2 billion per year through IFFs.
“There is need to strengthen the national institutional framework for monitoring and evaluation process and promote social cohesion in the country. It is also important to have social dialogue with institutions and different stakeholders in the fight against corruption in the country,” he said.
Zimbabwe Anti-Corruption Commissoion (Zacc) commissioner Nannette Silikhuni said it was imperative for public officials that have been sworn in to disclose their assets. Silikhuni said Zacc was also working on a national strategy to address issues of corruption.
“We also need to closely look at cultural policies that will address the root causes of corruption. We have become a people that have accepted corruption as a way of life. Zacc is mandated to look at policies that will address these cultural issues. We are working towards coming up with a national strategy to address issues of corruption,” Silukhuni said.