Mixed reports emerge on corruption in Egypt

Two new reports have painted very different pictures of corruption in Egypt in 2014.

According to Transparency International, which released its 2014 Corruption Perceptions Index on Wednesday, Egypt is one of the countries showing the strongest improvements this year, rising five points from last year to score 37 out of a possible 100 points. A score below 50 percent indicates a high level of perceived public corruption.

This score puts Egypt at 95 out of 175 countries surveyed, putting it solidly in the middle of the scale. Denmark topped the list in first place with a score of 92, while Somalia and North Korea shared last place with eight points each.

And yet by contrast, a November 27 report by global business analysis firm Ernst & Young ranked Egypt’s private sector as the most corrupt in the world.

Over 80 percent of business people surveyed for the Ernst & Young study believed fraud is widespread. More than 44 percent reported experiencing a significant act of fraud in the past two years, the highest level of any country surveyed.

The reports focus on different sectors of society and the economy, which explains some of the difference in rankings.

Transparency International focuses on corruption among government employees, while Ernst & Young looks at a range of unethical business practices in both the public and private sector, including fraudulent acts within a company, such as deliberately misstating financial results, or between private companies.

Not all the acts of fraud reported to Ernst & Young necessarily involve public employees, and therefore would not be considered for Transparency International’s report.

Ernst & Young also focuses on reports of actual incidents of corruption, while Transparency International looks at people’s beliefs about corruption.

“Research has shown us that people’s perceptions offer a reliable estimate of the nature and scope of corruption in a given country,” explains Transparency International’s website.

Others have questioned how useful a metric perception can be.

“Usually, with this kind of perception index, it shows what Egyptians think of their country, rather than where there country really is,” says economist Amr Adly, a nonresident scholar at the Carnegie Middle East Center.

“Perception is quite important, because it shows you that there’s a problem, but I don’t think that it’s a valid basis for comparing Egypt with other countries,” Adly explains.

Adly adds that corruption can be overemphasized as an indicator of development. “Egypt is a very corrupt country. That is an objective fact,” he says. However, countries like China and India manage to have both high levels of corruption and strong economic growth.

When institutions like the International Monetary Fund focus on corruption, it keeps them from looking at deeper problems in the free-market developmental model pushed by global financial institutions, Adly says.

 “It’s a way of saying there is nothing wrong with the theory, the problem is in the application.”

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