Corruption corrodes trust in government – IMF

The Managing Director of the International Monetary Fund (IMF), Ms. Kristalina Georgieva, said on Tuesday corruption corrodes trust in government and weakens the impact of policies and public spending.

Georgieva, who stated this at the 19th International Anti-Corruption Conference in South Korea, said the world has reached a point where lack of trust in government would impede health and containment measures.

The IMF chief, who quoted a former World Bank President, James Wolfensohn, said “corruption diverts resources from the poor to the rich, increases the cost of running businesses, distorts public expenditures, and deters foreign investors.”

“It erodes the constituency for aid programmes and humanitarian relief. And we all know that it is a major barrier to sound and equitable development.”

Georgieva stressed that IMF would help governments across the world to fight corruption now and in the future.

She stressed that the Bretton Woods institution has provided financial lifelines to 78 countries as part of its emergency lending.

“And we have sought to balance the need for accountability and transparency against the need to disburse financing very quickly so doctors and nurses can be paid, and the most vulnerable people can be protected.

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“Some of you may have heard me saying, spend what you need but keep the receipts. Accountability cannot take a back seat in this crisis.

“First, all countries receiving emergency financing from the IMF must accept a safeguards assessment of the central bank.

“This is an IMF assessment of a central bank’s governance and control framework to ensure that it can manage resources properly,’’ Georgieva said.

She said the fund has asked countries to commit to specific anti-corruption measures such as publishing of crisis-related procurement contracts and information about the beneficial owners of winning companies.

The IMF chief also advised countries to commit to enhanced monitoring of COVID-related spending and conduct an audit of crisis-related spending.

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