International extractive companies and their governments should work to make the Extractive Industry Transparency Initiative (EITI) require all EITI-compliant countries to require individual company-by-company reporting.
The United States has played a leadership role in the fight against global corruption, and there aremany reasons to be hopeful about this effort. Nonetheless, corruption continues to seriously impede development efforts around the world, and the critical task of combating it will require both long-term commitment and strong support from the next U.S. administration.
The White House and the World: A Global Development Agenda for the Next U.S. President shows how modest changes in U.S. policies could greatly improve the lives of poor people in developing countries, thus fostering greater stability, security, and prosperity globally and at home. Center for Global Development experts offer fresh perspectives and practical advice on trade policy, migration, foreign aid, climate change and more. In an introductory essay, CGD President Nancy Birdsall explains why and how the next U.S. president must lead in the creation of a better, safer world.
The U.S. Foreign Corrupt Practices Act is supposed to prevent U.S. corporations from giving bribes while conducting business abroad--bribes that encourage corruption in poor countries and stymie development. But some corporations use gaping loopholes in the law and its international counterpart, the OECD Convention on Combating Bribery, to win contracts and enjoy special advantages without fear of prosecution. Combating Corrupt Payments in Foreign Investment Concessions: Closing the Loopholes, Extending the Tools, a new report by CGD non-resident fellow Theodore Moran, describes the nature of these corrupt relationships and the harm they cause. It also offers suggestions on how to prevent them, including re-drafting the U.S. law and the OECD convention, tightening enforcement, and extending the Extractive Industries Transparency Initiative to other sectors and industries.
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Does foreign direct investment (FDI) channel capital and know-how to developing countries? Or does it bring corruption and abuse of labor standards? Harnessing Foreign Direct Investment shows that FDI's contribution to development can be extremely powerful but that some forms of FDI, especially infrastructure, have serious adverse consequences. CGD non-resident fellow Theodore H. Moran shows for the first time how some investors circumvent the U.S. and host country laws and international treaties outlawing corrupt payments without risking prosecution, and offers recommendations on what to do about it.
The G-8 has endorsed sweeping efforts to combat bribery and corrupt payments by international investors. Are these efforts effective? A new working paper by Theodore H. Moran says no. In How Multinational Investors Evade Developed Country Laws, Moran presents evidence that multinational corporations evade anti-corruption laws by making payments to relatives and cronies of developing country rulers. The findings will be discussed at a CGD event on Thursday, Feb. 16.
Does Foreign Direct Investment Promote Development? gathers together the cutting edge of new research on FDI and host country economic performance and presents the most sophisticated critiques of current and past inquiries.