Corruption in Cyprus;

The Unfavourable Downward Trend from GRECO’s report to Transparency International’s Corruption Index

The downward trend of Cyprus' ranking in the Corruption Perception Index still goes strong for another year. Unfortunately, the island has dropped even more in Transparency International's Corruption Perceptions Index (CPI) and achieving its highest rank in more than a decade. Actually, it has achieved its highest rank ever amongst 180 other countries. A higher ranking correlates with higher perceived levels of Public Sector Corruption in a country. This negative ranking is an alarming fact that needs to be remedied as it is damaging to the reputation of the country as a renowned and global business centre.

Transparency International e.V. (TI) is a German non-profit organization created in 1993 by former World Bank workers. It’s a non-profit and non-governmental organisation aimed to use anti-corruption strategies to combat global corruption and to prevent criminal actions that arise from corruption.

The island was ranked 52 out of 180 nations in 2021, which constitutes a considerable step down from 42nd in 2020. In general, Transparency International has identified that while corruption manifests itself in a variety of ways depending on the particulars of each nation, this year's results show that all parts of the world are at a standstill when it comes to combating public sector transgressions. The focus of the globe has been on adequately dealing with Covid-19 pandemic and to keep afloat their economies against the impending inflation.

The CPI “is the most widely-used global corruption ranking in the world. It measures how corrupt each country’s public sector is perceived to be, according to experts and businesspeople” according to Transparency International. This CPI takes into account issues such as: bribery, use of public office for personal gain, excessive red tape, nepotistic civil service appointments, the existence of laws requiring officials to disclose their finances and conflicts of interest and legal protection of whistleblowers amongst others when creating its ranking each year.

The countries that enjoy some of the lowest corruption index are predominately Denmark, New Zealand, and Finland and were actually voted the 'cleanest' countries in 2021. Somalia, South Sudan, Syria, Yemen, and Venezuela were the most corrupt countries.

Other statistics, showcased by Transparency International in mid-June 2021, suggested that in Cyprus, the majority of people (65%) believe that corruption has risen in the last year. This is the result of the controversies surrounding the Citizenship by Investment Program (“golden passports”) among other scandals that have been uncovered in recent years. The government was forced to cancel the investor passport scheme, a program that had been a huge boost in the local economy, but apparently was tarnished by corruption and personal gain. Cyprus has been sued by the European Commission, which is seeking an EU-wide ban on citizenship-for-sale programs.

The aforementioned scandal is part of a larger backslide in the fight against corruption. Over 70% of Cypriots believe corrupt politicians are untouchable, and more than two-thirds believe the government is dominated by business aimed for personal gain. Cyprus Papers, Pandora Papers, Paradise Papers are some of the examples of leaked documentation that implicate Cyprus as a national and international key player in money laundering schemes and corruption scandals.

Another notable blow in the country’s fight against corruption is the GRECO’s report issued in 2020 which saw the Republic once again unable to implement simple anti-corruption measures.

The Group of States Against Corruption also known as GRECO is the council of Europe’s anti-corruption monitoring body. GRECO’s objective is to improve the capacity of its members to fight corruption by monitoring their compliance with the Council of Europe's anti-corruption standards through a dynamic process of mutual evaluation and peer pressure. It helps to identify deficiencies in national anti-corruption policies, with a view to prompting the necessary legislative, institutional and practical reforms. During its Fourth Evaluation Report in 2016, Greco evaluated the corruption prevention in respect of members of parliament, judges and prosecutors in the Republic of Cyprus. The evaluation report stressed on the fact that greater transparency was necessary in regards to parliamentary processes as well as the members of parliament in particular. With the evaluation report GRECO issued 16 recommendations. From 2016 to 2018 Cyprus failed to adopt 14 out of 16 recommendations that would have ultimately helped minimize corruption. In GRECO’s latest report in 2020 it was identified that Cyprus implemented 7 recommendations to an appropriate level, 6 recommendations had been partly implemented while 3 recommendations had not been implemented at all. A key fact is that out of the 8 recommendations made regarding the parliament none had been completed to an appropriate level.

Unfortunately, all these negative facts have created a rising mistrust towards the public sector specifically and the government in general as Cypriots seem to be reluctant to trust their leaders.

In January 2021, the island’s officials proclaimed a slew of anti-corruption initiatives, including the creation of an anti-corruption agency, a beneficial ownership registry, and establishment of whistleblower protection laws. After years of delays and EU pressure, Cypriot MPs enacted an unified bill on whistleblower rights on Thursday (20/01/2022) , with the new law aiming to safeguard employees from reprisal for speaking out against wrongdoing. The employment and effect of the law remain to be seen; however, Cyprus is making the right steps to counter and fight corruption.

The Cyprus Integrity Forum a local NGO battling corruption stated that the CPI results are damaging to the island's reputation and status and that the government should take them seriously; as even tourists are shown to take into account the CPI when selecting their destination for holidays (Cyprus biggest industry is tourism)

Small measures have been done in recent months to implement some of the recommendations of the Council of Europe's anti-corruption organization (Greco), as well as the enactment of a legislation providing protection to whistleblowers, according to the NGO. The forum further argued that if the island aims to increase the inflow of foreign investment and enhance other sectors of the economy then the local culture on corruption must change immediately.

It is evident that half-measures and inaction will have no impact on this CPI or on any other corruption index if there are no credible and big steps that will allow the country to restore its credibility to its partners. The right steps have commenced, however the impact of those remains to be seen. Hopefully the 2022 ranking will be a decade long low and not the unfavourable result of 2021.

By fLEXI tEAM