Source: U.S. Department of State Daily Washington File

29 June 2000

Text: State Dept's Wayne on Anti-Bribery Report to Congress

(Cites need for OECD convention implementation, enforcement)(1670)

U.S. Assistant Secretary of State for Economic and Business Affairs 
E. Anthony Wayne says the United States will continue attacking
international bribery both on the supply and demand sides.

The Organization for Economic Cooperation and Development (OECD)
Convention on Combating Bribery of Foreign Public Officials is the key
weapon to deal with the supply side, bribe paying by multinational
companies to win overseas contracts, Wayne said in a statement
released in Washington June 29.

Wayne issued his statement as the State Department presented its
second annual progress report on the implementation of the OECD
anti-bribery convention to Congress. The Commerce Department
simultaneously presented a similar report to Congress.

The convention was signed by the 29 OECD member countries and five
countries in Latin America and Eastern Europe in December 1997. The
convention went into effect in February 1999 in 12 countries that had
ratified it. Since then, the number of countries that have ratified it
has risen to 21.

The United States attacks the demand side of bribery by supporting
programs that promote transparency, accountability and integrity in
public institutions around the world, Wayne said.

"Bribery and other forms of corruption impede governments in their
efforts to deliver basic services to their citizens; they undermine
the confidence of people in democracy; and, they are all too often
linked with trans-border criminal activity, including drug
trafficking, organized crime and money laundering," Wayne said.

Following is text of the Wayne statement:

Note: in text, "billion" means 1,000 million.
(begin text)


Good morning. Deputy Assistant Secretary Stephen Jacobs of the
Commerce Department and I are here today to brief you on our
Departments' respective annual reports to the Congress on
implementation of the OECD Anti-Bribery Convention. I will emphasize
the importance of the OECD Convention in the context of the
Administration's overall global anti-corruption strategy. Steve will
review some of the major findings of our two reports on progress that
the signatories are making on implementing the Convention. The State
Department's report, Battling International Bribery 2000, is required
by the Senate's resolution of advice and consent to ratification of
the Convention.

Secretary Albright has emphasized on many occasions that we are
committed to encouraging democracy and human rights, promoting
prosperity, supporting the rule of law and strengthening political
institutions. One of the main obstacles to meeting these goals is the
culture of bribery and corruption that corrodes too many institutions
and transactions.

We are, of course, against international bribery because it results in
tens of billions of dollars in lost exports for American companies and
others that play by the rules and seek to win contracts through fair
competition. But we are concerned about more than just the commercial
losses. Bribery and other forms of corruption impede governments in
their efforts to deliver basic services to their citizens; they
undermine the confidence of people in democracy; and, they are all too
often linked with trans-border criminal activity, including drug
trafficking, organized crime and money laundering. These are just some
of the reasons why the Clinton Administration has made fighting
corruption a high priority in its foreign policy. This is an issue on
which there is growing international consensus among developed and
developing countries alike.

The OECD Convention on Combating Bribery of Foreign Public Officials
in International Business Transactions is our principal weapon for
combating a particularly damaging form of corruption, the payment of
bribes to foreign officials in international business transactions,
sometimes referred to as the "supply side" of bribery. The Convention
represents a milestone in the battle against corruption in
international business transactions, a campaign in which the United
States has played a leading role for more than two decades.

Merely signing an international convention is not sufficient to stop
bribery. Implementation and enforcement of this agreement are key if
American firms are going to be able to compete on a level playing

Our two reports indicate that most of the signatories appear to be
approaching implementation of the OECD Convention seriously.
Twenty-one of the 34 signatory countries have ratified the Convention.
However, as Secretary Albright pointed out in her address to the World
Economic Forum in Davos earlier this year, we are concerned that
implementing legislation in a number of countries may be inadequate to
fulfill their obligations under the Convention. We will continue to
use diplomatic channels, both bilaterally and in the OECD, to
encourage these countries to remedy deficiencies and to urge the 13
countries which have yet ratified the Convention to do so without
further delay.

The OECD Convention represents a key element in a broader campaign
against corruption, which is carried out under the leadership of Vice
President Al Gore. A milestone in this campaign was Vice President
Gore's first Global Forum on Fighting Corruption held in February
1999, in which 90 countries participated. This initiative has included
a strong emphasis on ways and means of combating corruption in public
service, especially among justice and security officials. The United
States is cosponsoring a second Global Forum scheduled to be held in
the Netherlands in 2001, to which all members of the United Nations
will be invited to participate. The high profile given to the Global
Forum enhances the political incentive for national leaders to act
against corruption in their respective countries.

Beyond these activities and initiatives, the United States
participates in or encourages multilateral, regional and bilateral
initiatives to fight corruption by promoting transparency,
accountability and integrity in public institutions in virtually all
regions and in many specific countries. In this way, we are also
addressing the "demand" side of corruption, in other words, those who
are demanding bribes for international contracts, as well as those who
offer bribes.

An initiative in our own hemisphere, the Inter-American Convention
Against Corruption, criminalizes most acts of corruption by government
officials, including the receipt of bribes. This convention, signed by
the United States and 25 other countries in the hemisphere, makes an
important contribution to anti-corruption goals. The Inter-American
Convention is currently before the U.S. Senate. We hope that in the
near future, the Senate will approve a resolution of advice and
consent so that we can join the 19 countries that have already
ratified this important Convention. Our ratification would demonstrate
that the United States takes the obligations of the Inter-American
Convention seriously and help promote its effective implementation.

Let me tick off briefly some additional regional anti-corruption

-- In Africa, under the auspices of the Global Coalition for Africa, a
number of African countries are expected to approve this year at
Summit level a declaration of 25 anti-corruption principles.

-- In Europe, the Council of Europe is active in a number of
anti-corruption initiatives, such as the Criminal Law Convention
Against Corruption, which calls on parties to criminalize bribes paid
to public officials and parliamentarians, and addresses bribes paid to
private parties. The Group of States Against Corruption (GRECO) will
monitor the Criminal Law Convention, and this year it began the
process of monitoring "Guiding Principles" against corruption adopted
by the Council of Europe Ministers.

-- In the Balkans, the Stability Pact for Southeast Europe's
Anti-Corruption Initiative brings the United States, the European
Union, and regional countries together in a common effort to promote
good governance and combat official corruption, and thereby improve
the environment for trade and investment in the region.

-- The Asia-Pacific Economic Cooperation forum (APEC), in which the
United States plays a key role, has begun to address anticorruption
issues in the context of its work on investment promotion, corporate
governance, the international financial system and public sector

In addition, several specialized worldwide agencies have undertaken
initiatives that are of value in the fight against corruption. These
include the work in the World Trade Organization towards transparency
in government procurement and the work in the International Monetary
Fund on the threat of corruption to financial stability. The World
Bank has substantially improved its internal management controls and
has begun addressing anticorruption issues as part of its country
strategic planning discussions with governments. The World Bank
Institute, with U.S. funding assistance, has developed and is using a
set of procedures for anticorruption diagnostic surveys, to provide a
basis for development of national anticorruption efforts.

Moreover, in January 2000, the United Nations Ad Hoc Committee
negotiating the Organized Crime Convention concluded that a global
instrument against corruption would be desirable. Along with other
concerned U.S. government agencies, we are considering our approach to
this initiative, which we expect to begin after the completion of the
UN Transnational Crime Convention.

We are also reaching out to U.S. companies and business associations
to make them better aware of the international anti-corruption
environment. In May 2000, the State Department, in cooperation with
the Commerce and Justice Departments, published a brochure titled
"Fighting Global Corruption: Business Risk Management." This booklet
contains information about the benefits of strong corporate
anti-bribery policies and gives guidance to businesses on the
requirements of U.S. law and the OECD Convention.

As you can see, the Clinton Administration is actively engaged on many
fronts in order to advance our anti-corruption goals. While the OECD
Convention and other initiatives are beginning to have a positive
effect, bribery in international commerce is far from being
eliminated. All of us, government officials, business executives and
citizens alike will have to continue these international efforts to
stamp out the cancer of corruption.

Finally, I want to express my appreciation to our colleagues at the
Departments of Commerce, Justice and Treasury, the Office of the
United States Trade Representative, and the staff of the United States
Securities and Exchange Commission for their close collaboration in
the preparation of these reports.

(end text)

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