Should Indonesia Emulate Singapore’s Model of Eradicating Corruption?

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By Athena Wang

Not only does truthfulness among people create peace of mind and promote relationships of trust, but it is also the basis for a nation’s survival. A culture of dishonesty leads to endemic corruption, and corruption is often known as a destroyer of prosperity.

Thus, since independence, Singapore’s leaders have made the eradication of corruption one of its core missions for Singapore’s survival and success.

“There is no more corrosive effect to democracy and prosperity throughout the human race than corruption. It kills investment, it lowers economic growth, (and it) increases the cost to the economy and to the government everywhere it exists,” said Ambassador William Brownfield, Assistant Secretary of State for the Bureau of International Narcotics and Law Enforcement Affairs (INL), US Department of State, at the US Institute of Peace on Dec 10, 2015.

He mentioned that the cited amount of US$2 trillion (S$2.84 trillion) – the annual world cost of corruption estimated by the World Bank – was so far “larger than all but the two largest economies in the world.”

Corruption Perceptions: Singapore Vs. Indonesia

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In the Corruption Perceptions Index 2016 published recently on January 25, two-thirds of countries and territories fall below “50” in a scale of 0 (highly corrupt) to 100 (very clean).

Singapore was ranked the ‘cleanest’ ASEAN country with a score of 84, taking the seventh spot for being the least corrupt country, but with a slight decrease from 2015’s score of 85.

Indonesia occupied the 90th spot with a score of 35 – behind India and China who tied at 70th place with a score of 40.

Corruption in Indonesia

Indonesians frequently view corruption as a means to facilitate and increase efficiency in bureaucratic government systems, bypass rigid legacy legislations and laws, and land a job, amongst other reasons.

Surveys have indicated that slightly less than 50% of Indonesia’s civil servants have received bribes and admitted to corruption. It does not help that civil servants who do not accept or ask for bribes are typically viewed as foolish and unaccomplished by locals.

According to a World Bank report published on October 20, 2003, ‘Combating Corruption in Indonesia – Enhancing Accountability for Development’, the contributing factors to Indonesia’s corruption include the non-existence of system-wide criteria and standards, hesitance by superiors to dismiss or punish staff who accept bribes or reward staff for performing acts of integrity, and weak direction from the Indonesian civil service to emphasise a mentality of public service for the Indonesian people.

Although the report was published more than 13 years ago, Indonesia’s poor standing in the Corruption Perceptions Index appears to indicate that not much has changed.

Corruption is so ingrained in the Indonesian culture that it is normal for an Indonesian to set aside a portion of money for bribes when transacting with government agencies.

It is known that successful businesses in Indonesia are only made possible through close connections with leading government authorities.

The rampant corruption in Indonesia has ironically increased the procedures required for transacting with the government as these have to be conducted with bribes.

How Corruption Hampers Indonesia’s Development

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Indonesia’s endemic corruption has resulted in a loss of ‘legal’ entrepreneurial culture where new enterprises may not have the capital to bribe the government. This drives business underground with the concomitant loss of potential legitimate tax revenues that the government could allocate to areas that require more funds – such as in education or health.

Besides, corruption has led to a loss of potential foreign investments, as multi-national corporations prefer to invest in countries with transparent legislations and laws with effective enforcement by government agencies. This not only facilitates unemployment, but also hampers the transfer of both knowledge and technical know-how.

There are investment restrictions for foreign investors. Referring to the World Bank’s ‘2016 Ease of Doing Business Report’, Singapore is the world’s easiest place to do business, while Indonesia ranked #109. For example, you only need 24 hours and two procedures to set up a business in Singapore; in comparison, you have to wait three to six months and go through as many as nine procedures to incorporate a company in Indonesia.

In Indonesia, Presidential Regulation No. 36/2010’s Negative List of Investment (NLI) stipulates the types of business that are available or unavailable for foreign investors

When corruption thrives, Indonesian taxpayers are also finding ways to circumvent the payment of taxes at home by transferring their savings overseas, particularly to Singapore.

In an article entitled ‘Indonesia seeks lost trillions in Singapore’ on Asia Times Online, Bill Guerin revealed that billions of dollars worth of assets had been repatriated ‘legally’ to Singapore during the Asian crisis of 1997-98.

The lack of confidence that the people feel towards the government has also resulted in citizens resolving matters themselves, and to some, this includes crime.

Simon Gächter and Jonathan Schulz, economists at the University of Nottingham, concluded from a die-rolling experiment with volunteers from 23 countries that corruption at the national level breeds and trickles down to the individual, affecting their honesty.

Lessons to Learn From Singapore

Although Singapore is one of the least corrupt countries in the world, the tiny state has not always been graft free. It was reported that corruption was rife during Singapore’s colonial era. To curb corruption, the Corrupt Practices Investigation Bureau (CPIB) was established in September 1952 by the colonial government.

Professor Jon S.T. Quah, a Singaporean political scientist and prolific writer on corruption and governance in Asia, wrote in his widely-cited report ‘Corruption in Asia with Special Reference to Singapore: Patterns and Consequences’: “Corruption in Singapore is a fact of life rather than a way of life. Put differently, corruption exists in Singapore, but Singapore is not a corrupt society.”

How can Indonesia emulate Singapore’s success in eradicating corruption?

fProfessor Quah pointed out:

1. The key solution for Indonesia to resolve its corruption issues will require a strong will from the political leaders and country’s top government body to instil a mindset of zero-tolerance towards corruption.

The statesmen must be exemplary models and conduct themselves in an upright and modest manner. (Note: This can be difficult as these statesmen benefit the most from corruption.)

Regardless of status and wealth, anyone should be prosecuted when convicted of corruption. The anti-corruption scheme will fail if only ordinary people are punished for corruption.

2. There must be a non-corrupt anti-corruption agency, independent of police and political jurisdiction, and a comprehensive anti-corruption legislation to prevent loopholes, and to review and re-introduce amendments periodically.

3. The anti-corruption agency must employ honest personnel and be supervised by an upright political leader. Avoid overstaffing, and staff found caught in corruption cases must be punished or dismissed.

4. Government departments such as customs, immigration, internal revenue, and traffic police should review their procedures periodically in order to minimise the chance for corruption.

5. The salaries and fringe benefits of civil servants and political leaders should remain competitive with the private sector, so as to decrease inducement for corruption.

All things considered, to eschew corruption, there should be independent law enforcement, independent prosecutors, and an independent judiciary to investigate corruption and to put people into jail, said Daria Kaleniuk, co-founder and executive director of the Anti-Corruption Action Centre, Ukraine, at the US Institute of Peace on Dec 10, 2015.

Foster Truthfulness to Eradicate Corruption

Is it feasible for Indonesia to emulate the Singapore model, where there are high costs incurred in paying high salaries to political leaders and civil servants?

Instead of implementing tough laws and paying high salaries to politicians and civil servants, fostering a habit or culture of truthfulness among the government leaders and citizens, as well as educating the next generation about the virtue of truthfulness, is perhaps the best campaign to eradicate a nation’s corrupt practices.

No matter how many laws are stipulated, there will still be people who commit crimes, as laws, regulations or campaigns cannot fundamentally change a person’s heart.

Unlike tough laws, which execute harsh punishment, culture works as a soft power to restrict crime through nurturing a society’s morality.

Just as English writer Charles Caleb Colton said, “The moral cement of all society is virtue; it unites and preserves, while vice separates and destroys.”

After all, even the World Bank Blog featured a post in 2014 about “[creating] transparency and openness in government spending” to fight corruption – and “transparency and openness” are actions undergirded by the value of truthfulness.

The stability of a country does not rely on its legal clauses, but on virtue, and “[sincerity] and truth are the basis of every virtue,” said Confucius.

If all people know that doing wrong deeds is bad for themselves and others, then no one would dare cross the line.

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