Press Releases

    UNIS/CP/416
    17 June 2002

    OPENING STATEMENT BY THE DIRECTOR GENERAL OF THE UNITED NATIONS OFFICE AT VIENNA TO THE SECOND SESSION OF THE AD HOC COMMITTEE AGAINST CORRUPTION

    VIENNA, 17 June (UN Information Service) – Following is the opening address of the Director-General of the United Nations Office at Vienna and Executive Director of the United Nations Office for Drug Control and Crime Prevention (ODCCP), Antonio Maria Costa to the second session of the Ad Hoc Committee for the Negotiation of a Convention against Corruption on 17 June:

    Distinguished delegates,
    Members of the Committee,
    Ladies and Gentlemen

    Welcome to the second session of the Ad Hoc Committee for the Negotiation of the Convention against Corruption. You are taking part in -- actually it is more than that: you are gathered here to shape an exceptionally important process.

    I have taken office only recently, and therefore I did not take part in the Committee’s First Session. Yet, my interest in concerted action against corruption dates back several decades, starting from my earlier work at the United Nations in New York, and later at the OECD, the European Union and, until recently, at the EBRD. In these institutions I have personally witnessed the serious damage corruption can cause to a nation’s economy, and have reviewed what to do about it.

    To realize the extent of the corruption, it is useful to examine the entries "Errors and Omissions" in the International Financial Statistics (IFS) published monthly by the International Monetary Fund. These IFSs show candidly the all-too frequent instances when the unaccounted segment of a nation’s external transactions represent an unacceptably high percentage of its Balance of Payment (BoP). I have come across cases when one half, even three/quarters of a country’s BoP position went unexplained. It would be simplistic to explain high "Errors and Omissions" entries in a nation's BoP statistics as the sole consequence of corruption. Yet, the analytical work we have done at the OECD and at the IMF has shown that a significant inverse correlation exists between the accuracy and integrity of a country’s national accounts on the one hand, and the presence of corruption on the other hand.

    International statistics aside, we are all familiar with the fact that the national wealth of a number of countries was destroyed – in some instances, plainly stolen by corrupt leaders, leaving future generations struggle in despair. It is not surprising, therefore, that fighting corruption has become a priority in most countries. It is a condition for good governance and rule of law, which in turn are the foundation of sustainable development. My Office is leading this exercise because corruption is nothing less than another manifestation of crime, and as such it has long-term detrimental consequences on sustainable development. If it persists, it makes development unsustainable.

    Corruption is not only a macroeconomic issue. It is especially pernicious at the microeconomic level: It tilts the "playing field". Domestic tender processes are manipulated; companies that do business with the government achieve unfair advantages by paying bribes or secret commissions. The banking sector becomes itself corrupt, as it is asked to, and at times it volunteers to launder the financial proceeds of corrupt business practices.

    Most countries have now concluded that it is not in their long-term interests to accept conditions that degrade economic efficiency and increase the cost of doing business to the advantage of a few corrupt officials – public as well as private. In order to persuade companies not to compete corruptly, governments have to show that all other firms will do the same and that the rigour of the law is to be applied fairly and to everybody.

    As the fight against corruption is worldwide, this Ad Hoc Committee commands everybody’s attention – the attention of governments, international organizations and the civil society. Yet, do not forget the other side of the coin; namely the counterpart to the international appreciation for your work is the international community’s expectation that you will deliver. The task is demanding: you are asked to deliver a comprehensive, functional and effective international instrument to fight an old illness of our societies. The product of your deliberations will constitute tangible proof that the international community has risen to the challenge and found the right therapy to help countries realise the full potential of healthy, and therefore sustainable development.

    Achieving national economic health is a priority for all countries. Not surprisingly, the General Assembly has given this Ad Hoc Committee a broad term of reference, asking you to complete the negotiation process by the end of next year. Under your able leadership, Mr. Chairman, and under the guidance of the Bureau’s very efficient members, during the First Session you have set a good pace. This will augur well as to the success of the Ad Hoc Committee’s ability to comply with its deadline.

    This deadline is doubly significant. Firstly, it carries an important political message: the international community intends to mean business. There is no room for drawn out negotiations, as the product is needed urgently. Secondly, the deadline is yet another tangible proof that ground-breaking new legal instruments can be produced at the UN within a reasonable time-frame. The work of the previous (first) Ad Hoc Committee, in which many of you participated, went quite far. This positive experience can be repeated in this second round of deliberations.

    There are additional reasons for optimism.

    To begin with, you will consider a wealth of proposals, coming from all countries. These proposals demonstrate a generalized keen interest to participate actively in the negotiations, and register domestic views. The final product will reflect all aspects of the multifaceted problem of corruption.

    The availability of so many initial proposals also prove that the international community wishes to ensure that the Convention against Corruption will eventually enjoy the widest application, the maximum efficiency and the strongest effectiveness.

    I will follow the Ad-Hoc Committee’s work very closely. At this point I only have one recommendation: to add a new entry into the Committee’s rules of procedure. The rule should say that its members will be guided by a spirit of cooperation, with full understanding of different positions. This is fundamental to the achievement of consensus. It will also safeguard the quality of the instrument this Ad Hoc Committee is entrusted with developing. The resulting spirit of partnership will be crucial, throughout the negotiations.

    The road ahead will be bumpy, at times. One matter is especially difficult to negotiate: asset recovery. We are acutely aware of the devastating effect of corruption in impoverishing entire economies, when hundreds of millions, even billions of dollars are moved to foreign countries. The resulting economic chaos, the depletion of national wealth and the devastation at home are well documented. When good government is eventually restored, officials spend decades attempting to retrieve funds critical to repairing the social and economic damage.

    As the complexity of the asset recovery issue is to be fully appreciated, we will hold a technical workshop at the end of next week. It will help put the recovery question into perspective and contribute towards a better understanding of its various aspects. Such understanding is central to achieving workable solutions that could be then articulated into the language appropriate for an international legal instrument.

    In conclusion, while we are all seriously concerned about the moral and economic impact of corruption, there are reasons to be confident about your work: The conditions for success are present as the need to do something against this scourge is widely perceived; furthermore, your collective expertise and negotiating skills are unmatched. On my part, I pledge the Office’s full support in facilitating deliberations, providing advice and, when needed, food for thought (I have in mind the good work of the Secretariat), in an environment that will enable you to carry out your challenging work in the best possible way.

    Thank you.

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