Why Iraq’s Prime Minister Needs To Win The War on Graft Before Reconstruction Begins

Having put Islamic State to the sword, Iraq’s premier Haider al-Abadi has now set his sights on a new challenge – curbing the country’s endemic corruption, a struggle that must be won if his ambitious plans to revive regions devastated in the war against the insurgents are to be achieved.

The government has estimated that it needs $100 billion in reconstruction funds over the next ten years to restore Sunni cities and regions that bore the brunt of the conflict. Abadi is widely respected across Iraq’s highly sectarian political landscape, but in order to win the support of Sunni voters in elections next year he will need to demonstrate substantial progress on pledges to rebuild their heartlands.

The international community appears ready in principle to back Abadi’s rebuilding efforts though the scale of its support will likely be predicated on whether the country has the systems in place to ensure that funds are used effectively. So far, about half a billion dollars of assistance has been pledged. A donors’ conference in Kuwait early in 2018 is expected to secure more finance – however, Iraqi hopes of a Marshall Plan-like settlement for their country currently seem unrealistic.

While there is no shortage of goodwill towards Iraq, with world and regional powers acutely aware of the need to stabilise the country to avert an IS resurgence and stave off Iranian influence, there are real concerns that funds will be misspent or lost to corruption, as they were following the toppling of Saddam Hussein. A 2013 US government audit of its financing of Iraqi reconstruction over the previous decade, which came in at around $60 billion, found that nearly 15 per cent of  money had been wasted, with American military oversight of projects sharply criticised.

Iraqi leaders will be conscious that donors’ concerns over the distribution of funds may limit contributions, which is why they aim to supplement the latter with private investment. Already, Britain has earmarked $12 billion in loans available to UK companies engaged in Iraqi infrastructure projects. Baghdad is hoping that investment is directed towards public/private partnerships and the nascent small-to-medium-sized business sector, which could play a critical role in helping Iraq diversify its oil-dependent economy.

In the wake of IS’s defeat, Abadi launched what he described as a war on corruption. This has resonated strongly with many fellow Shia leaders – notably the hugely influential Muqtada al-Sadr – and Sunni politicians, whose constituencies want an end to a scourge that has blighted the country. The premier has been under pressure to act for some time. Last year Sadr supporters twice stormed the heavily fortified Green Zone, which houses government buildings and embassies, in protest over perceived government foot-dragging.  But fraud is so endemic that Abadi may struggle to make any headway. Some critics suggest that his combative pledges are little more than rhetoric aimed at boosting his electoral prospects or just a ploy to neuter political rivals.

Yet there are tangible signs that Iraq is committed to tackling fraud. In August a court jailed 26 high-ranking officials for up to 15 years after they were convicted of corruption. They included former ministers of defence, electricity and agriculture. It was a ground-breaking development as political interference in the judiciary has undermined efforts to prosecute and convict those suspected of graft.

The likes of the IMF will probably be looking for concrete state sector reforms which, even if Abadi is minded to introduce them, would meet considerable political resistance, possibly even from his own ruling Dawa Party. Cutting civil service jobs and salaries would undermine a deep-seated system of cronyism and patronage. It enables many parties to fund themselves and keep their constituencies onside – the former from kickbacks and the awarding of contracts to party-affiliated companies, the latter through the provision of public sector posts, which often furnish the incumbent with significant money-making opportunities.

Little wonder then that Abadi has warned that his battle against corruption may be more difficult than the one against IS. It might also explain why he is encouraging more private sector involvement in Iraq’s reconstruction, although overseas investors, like international lenders and foreign governments, will want to be reassured that they will not be channelling money into black holes.

So far, Abadi has been saying and doing the right things, albeit without really addressing government rent-seeking. Among headline anti-corruption measures, the courts will issue warrants against those who have allegedly smuggled money out of the country while contracts for past projects or investments that have failed will come under scrutiny. Sadr has been setting the pace by expelling dozens of people suspected of graft from his political movement.

Abadi has some time to formulate a more thoroughgoing anti-corruption strategy. His defeat of IS and retaking of the oil-rich city of Kirkuk from the Kurds has raised his stock among Iraqi Shia and Sunni communities who, for now, may feel that the jailing of officials for graft and robust pledges to tackle the latter are sufficient sign of progress. But international donors will likely want to see, at the very least, plans for substantial anti-corruption reforms as they assess how much they are prepared to commit to Iraq’s reconstruction efforts.

 

Ambrose Carey is a director at Alaco, a London-based business intelligence consultancy. He has particular experience in the Middle East, and has been involved in some of the most high profile asset-tracing cases of the past few decades.

Guatemala Faces Political Uncertainty As It Continues Its Fight Against Corruption

Guatemala’s political stability suffers again, due to a significant corruption scandal involving President Jimmy Morales, who attempted to expel the chief of a UN-backed anti-corruption panel from the country.

In 2015, the Central American country’s former president Otto Perez Molina was forced to resign following an extensive corruption investigation, questioning the political future of Guatemala and its repercussions on investors.

Corruption in Guatemala

On August 27, Guatemala’s already troubled political situation worsened when President Jimmy Morales attempted to expel Ivan Velazquez, the chief of the International Commission against Impunity in Guatemala (CICIG), a UN-backed anti-corruption commission. Morales’ decision followed the panel’s announcement to strip the President of immunity in order to continue its investigation into illegal campaign financing.

The probe would target several political parties in Guatemala, including Morales’ National Convergence Front. The party, as stated by the Attorney General, received approximately $325,000 in anonymous donations, as well as having $600,000 in unreported expenses.

Morales declared that Velazquez overstepped his authority by advocating changes to Guatemala’s legislative process, violating the country’s sovereignty. Although Guatemala’s Constitutional Court provisionally overruled Morales’ order of expulsion, the President’s announcement sparked two major protests in the capital Guatemala City, and further attracted criticism from the international community, fueling further political instability in the country.

Corruption scandals and political crises are unfortunately not new phenomena in Guatemala. In 2015, former President Otto Perez Molina resigned as a result of corruption allegations, resulting in his detention. He and former vice president Baldetti have also been investigated for bribery and money laundering, being suspected of awarding construction contracts in return for almost $38 million and other gifts.

The probe resulted in tens of thousands of protesters gathering for months in Guatemala City, giving rise to a strong anti-corruption movement among Guatemala’s citizens. Since 2007, the CICIG played a major role in cooperating with Guatemalan prosecutors in order to tackle corruption amongst high-level officials, sparking the investigation and movement which led to Perez Molina’s resignation.

Despite running his campaign revolving around the slogan “not corrupt, nor a thief” in 2015, Jimmy Morales’ reputation as an anti-corruption crusader will soon be under severe scrutiny. Besides being at the center of the recent scandal, in May a judge accused Morales’ son and brother of fraud, as they allegedly submitted $23,000 of false receipts in a tax fraud scheme in 2013.

This political climate will likely have a negative influence on Guatemala’s economy

Were this crisis to continue over a prolonged period of time, it will likely have negative repercussions on the country’s economic growth and investors’ confidence, stated Guatemala’s Central Bank President Sergio Recinos. Systematic corruption would result in a gradual erosion of the rule of law within the country, further challenging its already fragile institutions.

As a result, conditions for new investments and growth opportunities for businesses are not expected to be strong for the next six months. Recinos has also pointed out that Morales’ attempt to expel Velazquez was a major factor in the Central Bank’s decision not to raise interest rates, damping investor confidence.

This is significant when taking into consideration other factors, which combined with the recent crisis, might hurt growth and employment in Guatemala.

For instance, this year a court decision suspended work at a Tahoe Resources silver mine, resulting in a decrease in national growth by 0.4 percent. Furthermore, public spending and private sector lending have slowed down, partly due to the 2015 political scandal involving former President Perez Molina.

Nevertheless, it should be highlighted that Recinos added that the political situation has not yet had a negative effect on Guatemala’s economy, as any consequences are likely to be felt over a longer period of time. In order to support this view, Recinos referred to the economic slowdown in 2016, during which growth decreased from 4.1 to 3.1 percent, arguing that the corruption scandal involving Perez Molina likely had a strong influence.

In conclusion, Guatemala’s political future remains paved with uncertainty, as Morales’ future as President is still unclear. Ivan Velazquez has confirmed he will be continuing his role as CICIG commissioner, despite the President’s attempt to expel him. Meanwhile, the Supreme Court has requested to lift Morales’ immunity, although the final decision will be taken by Guatemala’s Congress.

While experts consider that the Congress might rule in favor of the President, this result will likely lead to nationwide protests, further weakening Morales’ mandate. Lastly, Guatemala’s future is thought to have regional implications with regards to anti-corruption efforts.

CICIG enjoys strong popular support, its focus on strengthening criminal investigations targeting high-level officials has inspired similar initiatives in Honduras and Panama.

 

Article as appears on Global Risk Insights: http://globalriskinsights.com/2017/09/guatemala-faces-political-uncertainty-continues-fight-corruption/

This column does not necessarily reflect the opinion of the editorial board or Frontera and its owners.

Corruption Allegations Take Center Stage In Malaysian Elections As Mahathir Mohamad Returns

The Malaysian general election campaigning season has been shaken up by the return of Mahathir Mohamad, a former prime minister who intends to challenge the party he once led. His return may be a key factor in uniting the opposition and reviving allegations of corruption against the current prime minister.

Political parties are mobilizing in preparation for general elections which must be held by August 2018. The main coalitions are Barisan Nasional, which has won every election since it was founded in 1973, and Pakatan Haraban, which has been steadily gaining vote share over the past decade. The election is significant because of two factors: the return of Mahathir Mohamad, a former prime minister who has joined the opposition coalition, and the 1MDB scandal which continues to dog the current prime minister Najib Razak. Together these two factors may be able to lead the opposition to an unprecedented victory.

A twisted web

Mahathir was Malaysia’s longest serving prime minister, serving 22 years between 1981 and 2003. Even after his retirement he remained a vocal critic of his successors. Now at age 92 he has come out of retirement to join the opposition coalition alongside the former deputy prime minister he had previously jailed, Anwar Ibrahim, with the aim of defeating the party he once led.

Anwar, the founder of the opposition party, is currently in jail on charges of sodomy similar to, but separate from, those leveled against him by Mahathir. Yet despite their troubled past Anwar has embraced Mahathir’s return to the fray. The reason is that Mahathir could be a unifying figure for the fragmented opposition coalition and an opportunity to win over previously inaccessible rural constituencies. After all, the opposition coalition is currently without a leader, since Anwar can hardly govern from jail and would require a full royal pardon to take part in the upcoming election.

The opposition’s situation has been bolstered by Najib’s association with the 1MDB scandal. American investigators have linked money taken from 1MDB, a government owned development firm, to Najib’s own accounts as well as those of his friends and associates. Najib has dismissed these allegations as politically motivated, though it is not clear what the ulterior motive would be. In 2015 it was unclear if Najib would survive the scandal, but having managed to retain his position as Prime Minister he will now have to face voters.

Corruption and the economy

This election could be a defining moment for Malaysian politics which have been plagued with corruption scandals for decades including the Felda Global Ventures scandal (2017), the 1MDB scandal (2015), the National Feedlot scandal (2012) and the Port Klang Free Trade Zone scandal (2008). Strikingly, no one has been held accountable for the Port Klang scandal or for the 1MDB scandal.

The most recent scandals, however, are occurring at a time when corruption is the mot du jour – from Brazil to Pakistan populations are becoming increasingly frustrated with systemic cronyism, corruption and inequality. The ability for information to be shared and spread online means that groups, and youth in particular, can be mobilized to hold their leaders accountable. In the past strong economic growth, limited information sharing capacity, and a weaker press may have suppressed Malaysian voter concerns about corruption. Better information sharing capacity combined with the opposition’s attempt to weaponize corruption allegations may turn the tide against entrenched groups.

A survey conducted by Transparency International found that 59% of Malaysians felt that corruption had increased in the past year and 62% felt that the government was doing a poor job of fighting corruption. The upcoming election may reveal how these sentiments translate into votes.

A long time coming

The current ruling coalition, Barisan Nasional, has never lost an election since it was founded in 1973 and Malaysia’s top position features an unbroken line of prime ministers from the UMNO, the coalition’s main party.

Their continued control, however, is no longer so certain. Barisan Nasional has gradually lost vote share over the past several elections. In 2004 they won a solid 63.8% of the vote and 51.4% in 2008. In 2013 they won only 47.4% of the popular vote but maintained control of parliament which led to accusations of gerrymandering.

A victory for Pakatan Haraban would be a sign of disillusionment with the status quo among voters. Perceptions of economic well being and representation, not just corruption, will define voter outlooks. If the Malaysian economy weakens voters may turn to Pakatan Haraban. Reforming entrenched interests and cracking down on corruption will continue to be a challenge regardless of who wins the election.

 

 

Peter Hays is an Analyst at Global Risk Insights. Article as appears on Global Risk Insights: http://globalriskinsights.com/2017/08/corruption-allegations-take-center-stage-malaysian-general-election-campaigning/

This column does not necessarily reflect the opinion of the editorial board or Frontera and its owners.

The 5 Brazilian Stocks Hit Hardest By Latest Political Corruption And Bribery Scandals

Political crisis spooks Brazil’s stock markets

Brazil’s stock markets plunged in the last two months after reports of a scandal by the President Michel Temer. State-owned companies Petrobas, Centrais Electricas Bras and Banco do Brasil were hit the most as political turmoil sent assets lower.

Now Brazil is pushed into a deeper political crisis after accused President Temer became the country’s first head of state to be formally convicted of corruption while in power. The Attorney General of Brazil’s Supreme Court charged Temer with taking million of dollars as a bribe from the country’s meat packing company JBS. This charge comes less than a year after Dilma Rousseff, the previous President, was ousted on criminal charges.

Shares of the iShares MSCI Brazil Capped exchange-traded fund (EWZ) have tanked 5% since May 18 and have underperformed the iShares MSCI Emerging Markets ETF (EEM). Fund flows to Brazil however continue to remain undeterred as investors consider this dip as an attractive entry point. 

Worst hit stocks

In the past three months, the worst performing Brazilian stocks were JBS SA (JBSS3), Naturas Cosmeticos (NATU3.SA), Mahle Metal Leve (LEVE3.SA), Centrais Electricas Bras (ELET6.SA) and Petrobas (PETR3.SA).

JBS SA

JBS (JBSS3), Brazil’s largest meat-packing company has been slapped with $3.36 billion fines to settle allegations of bribery. JBS is at the center of the latest political corruption probe that was triggered in May. Shares of the company have tanked 21% since May 18 and 34% YTD.

The company’s shareholders have turned to Banco Bradesco’s investment banking unit to dispose off some assets in order to raise money to settle the fines. These hefty penalties have spooked investors and led to a one-third decline in the company’s stock price in 2017 so far. Market capitalization of JBS has declined by 21% since May 18.

The largest shareholder in JBS – the Batistas – are considering selling off Fábrica de Produtos Alimentícios Vigor SA and sportswear and shoemaker Alpargatas SA to raise funds to pay off the fines.

Naturas Cosmeticos

Naturas Cosmeticos (NATU3.SA) stock price has declined 27% over the past three months and 13% over the last one month alone. The company trades on the Sao Paulo Stock Exchange and has a market capitalization of $3.1 billion.

Natura has also invested in compliance systems in the last two years to adhere to Brazil’s Clean Companies Act and control corrupt acts by employees.

Petrobas

Petrobas (PETR3.SA), Brazil’s state-run oil company, has been engulfed in corruption scandals since 2014 that have cost the company nearly $13 billion in the past five years.

The company was charged $2.1 billion in fines in 2015 and $833 million in March 2017 for manipulating oil prices. It also had impairment losses of $14.8 billion. The loss reflects the decreasing value of the company’s assets resulting from the drop in oil price, project delays and other factors. In early 2015, the company formed a compliance team of nearly 350 employees to prevent further instances of corruption.

These corruption scandals have put pressure on the company’s balance sheet at a time when it is already battling low oil prices. To improve cash flow, it cut its workforce by 20% and reduced capex by 32%. Further, it sold off assets to reduce its debt load including a natural gas pipeline system with Brookfield Infrastructure.

Shares of the company are down 11% YTD and 8.4% over the last three months alone. Consequently, the state-run company has lost 15% of its market value during the year so far. Petrobas’ ADRs also trade on the New York Stock Exchange under the ticker PBR-A. 

Centrais Electricas Bras

Centrais Electricas Bras (ELET6.SA) is the Brazilian state-controlled utility provider engaged in the generation, distribution and transmission of power through various companies like Electrobas holdings, CGTEE, Chesf, Eletronorte, Eletronuclear, Eletrosul, Furnas, Amazonas Energia, Distribuicao Acre, Distribuicao Alagoas, Distribuicao Piaui, Distribuicao Rondonia, Distribuicao Roraima and Itaipu Binacion.

Even though shares of the company are down 36% YTD, it is expected to gain significantly from the Brazilian government’s plan to revamp the power sector. Brazil’s government is planning to overhaul power sector regulations by 2018 leading to lower taxes and promote foreign investments in the sector.

Centrais Electricas Bras trades on the Sao Paulo Stock Exchange (IBOVESPA) with a market capitalization of $6.1 billion. In the last three months, shares of the company have lost 16%.

Mahle Metal Leve

Mahle Metal Leve (LEVE3.SA) is a Brazilian auto parts manufacturer engaged in production and manufacturing of  pistons, bearings, connecting rods, valve train systems, air and liquid filter systems, industrial filters among other products. MAHLE Metal Leve provides components for vehicle manufacturers such as Volkswagen, Audi, BMW, John Deere, Porsche, Opel, Toyota, Ford, General Motors, Mercedes-Benz, Fiat, Renault, Peugeot, MWM-International, Cummins, Scania, Volvo, Caterpillar and Perkins, among others.

The company’s stock has declined 18% over the past three months and 13% over the last one month making it one of the worst performing Brazilian stocks. The company’s market capitalization has fallen by 18% year to date. The company trades on the Sao Paulo Stock Exchange (IBOVESPA) and has a market capitalization of $689million.

Valuations

Brazilian stocks are currently at steep discounts with the MSCI Brazil Index trading at average one-year forward PE ratio of 18x.

CIA Estadual De Geracao (EEEL3.SA), Centrais Electrics Bras, CIA De Transmissao De Ene (TRPL4.SA), CIA Paranaense De Energi (CPLE6.SA), Magnesita Refratarios (MAGG3.SA) and JBS are the most attractive stocks based on their cheap valuations. These stocks have one year forward PEs of 1.4x, 2.1x, 2.2x, 4.7x, 5.2x and 5.4x and are trading at the steepest discount to their peers. Meanwhile, Movida Participacoes (MOVI3.SA), Springs Global Participacoes (SGPS3.SA), Lojas Americanas (LAME4.SA), and Eletropaulo Metropoli (ELPL4.SA) are currently the most expensive stocks in Brazil.

Have Political Headwinds Changed Course For Brazil After President Temer’s Acquittal?

Michel Temer acquitted by the Brazilian court

Brazil’s President, Michel Temer, was freed of charges of soliciting illegal campaign donations by the Brazilian court on Friday, June 9th. “You don’t remove a president whenever you please,” marked Gilmar Mendes, the court’s top judge, citing that the evidence presented was not enough to prove that the illegal money that went to the political parties was used in the campaign.

Have political headwinds changed course in Brazil?

Political corruption isn’t new to Brazil (EWZ) (BRF) (BRZU). Temer himself is a survivor of several other scandals and charges in the past. The Mensalão scandal, Operation Car Wash, and the Petrobras scandal serve as important examples of the close links between Brazilian politics and political corruption in Brazil.

The Mensalão scandal: a vote-buying case of corruption that threatened to bring down the government of Lula da Silva in 2005.

Operation Car Wash: investigation being carried out by the Federal Police of Brazil, Curitiba Branch under Judge Sérgio Moro since March 17, 2014. Initially a money laundering investigation, it has expanded to cover allegations of corruption at the state-controlled oil company Petrobras (PBR) (PBR-A) (PBRA).

The Petrobras scandal: uncovered in 2014, it remains the largest corruption scandal in the history of Brazil. According to the investigation, top Petrobras executives colluded with an organized cartel of 16 companies to allegedly accept bribes in return for awarding contracts to construction firms at inflated prices. Petrobras officials estimate the bribe amounts to a total of nearly $3 billion.

Taking a Look Further Back

In August 2016, Brazil’s first female president, Dilma Rousseff, was removed from office while serving her second four-year term. Rousseff was charged with criminal administrative misconduct and disregard for the federal budget. Rousseff was also accused of failing to act on the Petrobras scandal or on the allegations uncovered by the Operation Car Wash investigation. She was replaced by Vice-president Michel Temer who is currently the 37th President of Brazil.

One of the largest incidents of political corruption of this generation in this Latin American (ILF) economy actually dates back to 1992 when Fernando Collor de Mello, the country’s first democratically elected president, was impeached on corruption charges.

Tunisia’s Anti-Corruption Drive Threatened By Controversial Amnesty Plans

A major new government crackdown on corruption is being seen by some as political opportunism, amid recent signs of a wavering commitment towards greater transparency.

Earlier this month, Prime Minister Youssef Chahed, quoted in local newspapers, described the country’s struggle against graft as a “long-term war, a sustained policy”. His remarks followed a wave of arrests of prominent businessmen as part of what the authorities have described as an unprecedented campaign against corruption.

Tunisians overthrew the corrupt regime of Zine El Abidine Ben Ali in 2011, sparking the Arab Spring protests that swept across the Middle East.  But unlike its neighbours, Tunisia has been undergoing a much-praised democratic transition – although graft remains a serious problem and economic reforms have been lagging.

The head of the national body charged with combating corruption, Chawki Tabib, warned last year that graft had reached “epidemic” proportions. He said curbing the scourge would be more difficult than fighting terrorism. However, some progress has been made.  Laws protecting whistle-blowers and granting public access to information have been adopted, and draft legislation requiring officials to disclose their income and assets is before parliament.

Yet the government has struggled to dismantle the system of laws and administrative practices that protected the interests of Ben Ali, his family and cronies.  “Graft was democratised after the revolution – before, it benefited a handful of prominent figures, but it spread to dozens, hundreds, and then thousands of people who knew how to play the system for their own gain,” Tabib told the Carnegie Endowment for International Peace in May.

At the end of last month, the authorities arrested and seized the assets of eight businessmen on suspicion of corruption.   An investigation had revealed that the suspects, who have been placed under house arrest, had been involved in “relations that enabled them to illegally make huge profits”. Earlier, three businessmen and a customs official were arrested over graft allegations.

But the motives for the crackdown have been questioned by Tunisians whose faith in the government has been shaken by its renewed efforts to pardon those suspected of looting the country’s assets.  Some believe the latest anti-corruption swoop is less about curbing graft than  attempting  to diffuse unrest in the south of the country and political score-settling.

Last month, the security forces were deployed to try to quell demonstrations over unemployment and poverty after protesters sought to disrupt oil and gas installations. They had been demanding more energy sector jobs and a greater share of revenue generated by the industry. Tensions reached a pitch when a protester was killed in the clashes. Those detained in the anti-graft operation are also suspected of financing the protests.  There is speculation too that the arrests are part of an internal conflict within the ruling Nidaa Tounes party.  In April it was reported that some influential members suspected of graft were preparing to replace Prime Minister Chahed.

Questions over the corruption crackdown seem to have come to the fore because of the reintroduction in May of the controversial Economic Reconciliation bill.  Under the proposed law, those who profited illegally under the former regime would be offered an amnesty in return for paying back the funds they embezzled.

In mid-May, thousands marched through Tunis in protest against the bill, which was first tabled in 2015 by President Beji Caid Essebsi as a means of helping to revive the troubled economy.  He argued that it would enable the government to recover billions of dollars of looted funds and encourage former officials and businessmen to invest in the country.  But the draft legislation was repeatedly held up in parliament – and then postponed indefinitely – because of resistance from those who feared it would whitewash Ben Ali’s cronies and undermine Tunisia’s transitional justice process.

Three years after Ben Ali was overthrown, a Truth and Dignity Commission was set up to investigate human rights violations and graft during his tenure.  The organisation’s mandate is to arbitrate in these cases or refer them to the justice system.  Only last month, it heard testimony from Imed Trabelsi, a nephew of Ben Ali, who apologised on national television for corruption under the former regime.

Some rights activists argue that the Economic Reconciliation bill, which guarantees the confidentiality of alleged offenders who come forward, would take over the roles of the Truth and Dignity Commission and the justice system in investigating and prosecuting corruption crimes. According to Human Rights Watch (HRW), decisions by the body to be tasked with implementing the draft law would not be made public nor conveyed to the administration, while its mandate would not include investigating the inner workings of corruption under the former regime.

The campaign group claims the Truth and Dignity Commission has already encountered obstruction from government institutions in its efforts to investigate financial crimes and would lose the authority to do so if the new bill was passed.  Instead of helping to clean up Tunisia’s institutions by identifying corrupt officials and excluding them from public office, activists say the proposed legislation would entrench the culture of impunity in the country’s administration.

Parliamentary approval of the bill will require support from Nidaa Tounes’ coalition partner, Ennahda, which wants revisions  ensuring the Truth and Dignity Commission is not undermined. But even if amendments are forthcoming, the legislation sends the wrong signal to those Tunisians eager to see the government adopt a more concerted approach to both countering graft and promoting transparency.

 

Yigal Chazan is an Associate at Alaco, a London-based business intelligence consultancy.

This column does not necessarily reflect the opinion of the editorial board or Frontera and its owners.