Stronger Anti-Corruption Body to Handle Shadow Economy
20 December, 2012
Stronger Anti-Corruption Body to Handle Shadow Economy
Only fully independent anti-corruption service with investigation and persecution rights may deal with shadow economic deals practiced by ex-powers that be in several directions, including non-transparent privatization and state procurements, property rights infringement and the misuse with the state budget-based funds.
The anti-corruption body of Shevardnadze’s regime had only monitoring and recommendation function. The Inter-Structural Coordination Council (ISCC) established in December of 2008 by the presidential decree of rose-government as an anti-corruption body has only preventive functions. Both turned out
ineffective as the results show.
Rose-government achieved a success to fight the petty corruption since 2004. Services which justice houses provide to the citizens, the creation of a database of civil servants’ property declarations, and the introduction of an innovative electronic system of state procurement and online governance mechanisms have enhanced the transparency of the government’s activities in some areas. But the elite corruption flourished on the other hands and risks that high rank officials may abuse power to enjoy economic benefits remain high due to legislative flaws.
The reason is lack of political will and power imbalance: strong executive and law-enforcing bodes against the backdrop of the weak parliament and court – this was the message Georgian non-governmental sector sent on December 14, 2012 at the conference closing the Anti-Corruption Week.
“Over the past years, there have been many examples of alleged cases of elite corruption privatization, licensing, etc,” Eka Gigauri, Executive Director of Transparency International Georgia, said in the interview to Georgian Journal. “I agree that the ex-power eliminated petty corruption but we had plenty of facts of power abuse that also is a corruption. Meantime law-enforcers turned a blind eye to them and practiced a selective justice - this is kind of corruption too. In the pre-election period state structures were very politicized and treated different actors differently, that also is a big problem. Therefore we find it important to adopt the balanced legal system that legal power should monitor executive power; police, control chamber and regulatory bodies should be independent and there must be an independent anti-corruption body accountable to either the parliament or primer and that will have investigation function too.”
The currently active Council embodies high-ranks officials of all units of the executive, legislative and court powers, and is headed by the Minister of Justice. The key task of the Council is to outline the anti-corruption policy and national anti-corruption strategy together with the action plan, also coordination of inter-structural activity and insurance of the recommendations provided by international organizations.
Although the Council is not an independent anti-corruption body as far as it has no own budget and personnel. Analytical Department of the Ministry of Justice incorporates the secretarial function of the Council next to the department’s other responsibilities. According to Rusudan Mikhelidze, Director of Analytical Department, Georgian anti-corruption body model is in line with the UN recommendations requiring both investigative and preventive anti-corruption bodies to operate in the country.
“There should be two [anti-corruption] bodies: one with the investigative and persecution rights that is at our Prosecutors’ office, and the second with preventive function as our Council does,” she said presuming the reason this mechanism was not effective was perhaps the political will.
Tamar Chugoshvili, Chairperson of Georgian Young Lawyers’ Association, believes the reason was the legislative loopholes enabling top officials elude accountability while they were mishandling with the state money and assets. There was a general practice of the state property divesture and the state budget mishandle through the self-governance bodies: municipalities of Tbilisi, Kutaisi and Batumi for example set up several non-commercial funds of public law entity and handed the municipality-owned [or the state-owned] property at their disposal without any privatization related procedures. These funds were involved in sundry infrastructure development projects. However to implement their task funds were implementing procurements without transparent electronic procurement system and hired operator companies without call for tenders that would be obligatory if the questioned funds’ assets would have been into the state ownership. Moreover, these funds did not disclose information how they attracted or used their financial resources.
An explicit sample of this scheme is how Tbilisi Old City Rehabilitation and Development Fund [founded by Tbilisi City Hall] misused with over GEL 288 million [allocated by Tbilisi budget in the fund] bypassing the law on state procurements. And the public is still unaware of exact disposal of the questioned sums.
Ultimately the government-affiliated businesses have been winning tenders and flourished on the expense of deteriorated competition climate and impoverishment of population.
“As a result although economy of Georgia has been growing all the time the benefits of the growth were not redistributed on the entire population. And one of the hampering reasons was high level of elite corruption, favouritism in the country. There were state- favorite funds, favorite businesses that won tenders. As a result sum and fiscal imbalance was so huge that baffled to the country’s development, to insurance competitive climate to private sector that creates jobs,” Nino Evgenidze, Executive Director of the Economic Policy and Research Center, said.
On the other hand, the presidential and governmental funds with about GEL100 million totally and created to finance emergency needs have been spending twice and trice more than the officially declared budget on entertainment activities and needs that still remain unclear to publicity. Under the excuse to manage with the state property more effectively government used to hand valuable assets to private investors for symbolic price of GEL 1 but did not monitor the further implementation of the contracts that also smells by elite corruption, experts presume.
To make anti-corruption fight effective in Georgia non-governmental watchdogs recommend transforming the currently active Council into completely independent body with the extended rights on investigation and persecution as the best world practice suggests as the most relevant model to countries with transitional economy and fledgling democracy.
Aleksandre Baramidze, Deputy Minister of Justice, agrees with the trumpeted shortcomings in the anti-corruption mechanism and swears new government is intent to solve the problem. However he reminds that most changes aimed to make anti-corruption body independent require constitutional amendments that cannot be done too soon. Meantime, he finds apt to work with the currently active Council to make it more effective and go ahead with open discussion over the suggested independent anti-corruption model.
Print
Other Stories
Business Positive – Successful radio program from Radio Positive
Starting point of radio program Business Positive is to meet interesting people, communicate with them and deliver information that is interesting for the audience.
A factory of electric vehicles to be built in Kutaisi
Prime Minister Mamuka Bakhtadze stated that a factory of electric vehicles will be built in Kutaisi at the presentation of the Aigroup business group.
Qvevri-shaped hotel complex to be built in Telavi
A Qvevri-shaped hotel complex is scheduled to be built in the village of Shalauri in Telavi, Kakheti (east part of Georgia).
Georgian designers presented at Fashion World Tokyo 2019
The products of 11 Georgian designers are showcased at Fashion World Tokyo 2019,
Silknet raises $200 million in Eurobond issue
27 March 2019 - JSC Silknet (“Silknet”), one of Georgia’s leading telecommunications operators, has successfully priced a debut $200 million 5-year 11% senior unsecured bonds issue (the “Notes”).
Pistachio trees will be planted in Georgia
Dozens of hectares of Pistachio are planned to be planted in Georgia this year.
Toyota Safety Sense and Hybrid Technology
Toyota Caucasus, has presented two new models the 5th generation RAV4 and the 12th generation Corolla at Rustavi International Motorpark, several days ago.
Bidzina Ivanishvili “became number one oppressor of businesses in Georgia” - ICC Georgia chairman Fady Asly
Mr. Ivanishvili promised the business community to protect them from harassment and pressure, unfortunately his words died with the sunset of that day
The best brands of Belarus will be exhibited on a large-scale exposition in Tbilisi
"The Belarusians like to come to Georgia to relax near the sea in Batumi as well as to stay in sunny Kakhetia."
Don’t treat business like a hooker! - Georgian businessman Vasil Soprpmadze addresses politicians
Businessman Vasil Sopromadze, founder of the company "Fresco", addresses politicians
RAV4 No Compromise and Corolla Set to Impress – Two New Cars Presented by Toyota
Toyota Caucasus, the company constantly aspiring to greatness, has presented two new models the 5th generation RAV4 and the 12th generation Corolla.
Mamuka Khazaradze quits TBC bank, does not sell the TBC Bank share
I made a decision to leave TBC bank where I spent 27 years of my life
10 Reasons to buy an apartment in the suburbs
There is a tendency for Tbilisi dwellers to move from central parts of the capital to the suburbs.
Georgian citizens are granted the right to work in France
The French Embassy in Georgia made remarks on granting Georgian citizens the right to work in France
The New York Times: Bitcoin declines but Georgia still bet on it
The New York Times has recently published an article about reasons, challenges and causes of generating Bitcoin in the former Soviet country Georgia.
EU to allocate € 13 billion for Eastern Partnership countries, including Georgia
The European Union together with the World Bank plans to allocate investment worth € 13 billion for infrastructure projects in the Eastern Partnership countries.
Anaklia Port and its importance for Georgia
In 2016, Anaklia Development Consortium was authorized to launch the construction of Anaklia Port.
Cryptocurrency mining threatens electrical network in Abkhazia
In the breakaway region of Akbhazia rampant cryptocurrency mining is threatening the shaky electrical network, reports an article of the news portal EuroNet.
Caucasus Wine University to be opened in Gurjaani
In the Kakheti region a new viticulture campus of the Caucasus University is in the process of planning.
Photos describing life of the poorest in Georgia
Fight with poverty should be among top priorities of every government in every country.
Training farmers to rescue the organic hazelnut production in Georgia
Even drizzling rain and unpleasant gusts of wind can’t prevent the farmers from coming and participating in the agricultural training.
Bleak times for organic farmers in Georgia – but there is hope
Organic hazelnut production is a delicate plant in Georgia that has emerged just a couple of years ago. Various pests, among them the Asian stink bug Parosana, trouble hazelnut farmers and menace their livelihood – even before their businesses could really take off.
Hybrid car imports are going through the roof in Georgia
Thanks to their fuel economy, the popularity of hybrid cars is increasing in Georgia, where fuel affordability is low and prices for fuel are unstable.
The New Year offer from MAQRO Construction - Apartments with unbelievable discounts and the parking spaces for FREE!
Location, green yard, spaces for various needs, experience of the construction company and parking space are the main important criteria for potential buyers of apartments.
Interview with the co-founder of Kiwi Vegan Café – the first vegan place in Tbilisi
Behind the Kiwi Vegan Café stands a group of activists who wants to raise Georgian’s awareness for animal rights and welfare.
PHOTO OF THE DAY
GEL Exchange Rate
Convertor
20.04.2019
21.04.2019
USD
1
USD
2.6935
2.6935
EUR
1
EUR
3.0291
3.0291
GBP
1
GBP
3.5021
3.5021
RUB
100
RUB
4.2126
4.2126
Other Stories
Recently Toyota rolled out Global Campaign under this slogan that reflects the Olympic and Paralympic Spirit of Encouragement,
A couple from Switzerland combines Swiss tradition and technology with Georgian products. Their cheese is made in the Georgian mountains and sold in local stores and hotels.
It has been more than five years since the residents of Lilo village, near Tbilisi, cannot open their windows.
63 000 GEL was received by the Georgian Agro Export Group which is just a small part of the European Neighbourhood Programme for Agricultural and Rural development.
Georgian entrepreneur Guka Tavberidze, who runs his own business in the UK and does it quite well, has been invited by BBC
The grand opening of 7-star The Biltmore Hotel Tbilisi took place in Georgia’s capital on July 31.
DUSHETI, Georgia – The Georgian government and the World Bank will allocate USD 5.6 million (12 million GEL) to fund
A new Georgian clothing brand named Person has emerged in Georgian market.
Georgia is in the midst of an economic maelstrom, Euronews reports.
Situation at Georgia’s mineral water market is interesting: over the last year, the volume of export has grown by 56 percent. According to “GeoStat”, over $114 million worth of mineral water was sold
GEL Exchange
USD
1
USD
2.6935
EUR
1
EUR
3.0291
GBP
1
GBP
3.5021
RUB
100
RUB
4.2126
April 2019
Mon Tue Wed Thu Fri Sat Sun
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
22 23 24 25 26 27 28
29 30