Why Do A Lot Of Corruption Cases Still Emerge During The Pandemic?

Alarm bells should ring when a lot of corruption cases still emerged in the face of the Covid-19 pandemic. This implies that some individuals turned a blind eye to the plight of others. Corruption seemed inherent in our culture.

According to Transparency International, the corruption perceptions index in Malaysia dropped from 53 in 2019 to 51 in 2020. The lower the corruption perceptions index, the more corrupt the country. In the ASEAN region, Singapore, as a developed country, with the highest GDP per capita in the region at 66675.77 US dollars in 2019, was perceived to be the least corrupt country with an index of 85. Brunei was ranked second in the region with a score of 60, followed by Malaysia (51) and Indonesia (37). Cambodia was perceived to be the most corrupt country with a score of 21. Even though Myanmar’s GDP per capita was the lowest in the region, it was perceived to be the second least corrupt country.

Even though Malaysia was ranked third in the region, but it still lagged far behind Singapore. In Malaysia, out of 998 arrest cases, 467 cases involved public officials, with most of them from supportive staff. A higher corruption perceptions index can have many unfavourable impacts on the economy. Economic growth can be disrupted. The money that should be spent on productivity is diverted into bribery.

This is the reason why most developed countries have a lower perceptions index compared to less developed countries. National debt will increase, and inefficiency at managing the government’s funds ensues. Corruption can result in public investments rising. The offence committed by high-level government officials can greatly impact the economy because the money spent on reducing inequality and poverty cannot be utilized.

Other than trade openness, market size and inflation, corruption can also deleteriously affect foreign direct investment (FDI). Many studies have shown that higher corruption can reduce FDI inflows. It can add costs for foreign investors to make investments. FDI is of the utmost importance, especially for developing countries, to boost economic growth and reduce the unemployment rate. However, some studies also found that higher corruption can increase FDI because foreign investors can avoid rules, regulations, and unwieldy bureaucracies. Therefore, it is easy for them to invest in countries with high corruption such as China.

Some studies have shown that the misuse of public funds to boost the economy can harm the environment. In the presence of corruption, firms that do not follow environmental regulations can be in operation. This means that there is a disruption to enforcing the regulations. If they run their operation and earn profits without considering the harmful impact on the environment, the residents around them will suffer the negative externality. Thus, their health can be affected.

The onus should lie on all of us, regardless of high-level government officials, supportive staff and even the public, to ensure that the corruption perceptions index is on a par with that in developed countries. In efforts to get rid of this culture that has been long inherent in our society, laws against corruption should be revised in order to serve as a strong deterrent to would-be offenders.

Dr. Mohd Shahidan Shaari
Senior Lecturer in Economics Faculty of Applied and Human Sciences, Universiti Malaysia Perlis

*The views expressed here are those of the author/contributor and do not necessarily represent the views of Fokus.my

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