Limits to the Asia-Pacific Growth.

Byline: Meseto Abe

Following the massive socioeconomic success of the largest continent, corruption is the next battleground in the development of the Asia-Pacific. Lately, it has hampered inclusive and sustainable development and is a primary cause of the difficulty experienced by developing AsianPacific countries in advancing beyond the middle-income bracket. Fostered by weak regulation and enforcement frameworks, corruption comes in many forms, including bribery, embezzlement, and cronyism. It undermines not only business ethics and positive social norms, but also people's trust in political and economic systems, institutions, and leaders.

Transparency International's Corruption Perceptions Index (CPI), which measures corruption in 180 countries annually, reveals that high-income countries experience far less corruption than their lower-income counterparts do. With Singapore in sixth place and Afghanistan in 177th, the AsiaPacific is home to countries at both extremes of the CPI. China and India, the world's most populous countries, are ranked 77th and 81st, respectively. Countries in the Asia-Pacific have made some efforts to combat Limits to the Asia-Pacific Growth Meseto Abe corruption, but that the problem remains widespread throughout the region tells us that these are not enough. In fact, there seems to be a wilful lack of attention among these countries about tackling corruption head-on

Corruption affects every aspect of society

This lack of attention may be due to the widespread belief that corruption helps "grease the wheels" in business activities. Top companies pay large amounts to receive faster and better service from authorities; this, the thinking goes, makes the economy more efficient. In the Asia-Pacific, this often manifests itself as bribes, gifts, banquets, and favours given by business entities to politicians and bureaucrats. In the view of its proponents and those who tolerate it, corruption speeds up the wheels of commerce and positively impacts companies' development by easing bureaucratic barriers. Corruption can also facilitate a company's entry into a highly regulated economy that is difficult to penetrate otherwise. But these benefits hold true only for a small number of companies.

Corruption has an inverse U-shaped relationship with company revenue: a company may gain benefits when it pays bribes, but the benefits are subject to diminishing returns after a certain amount. Also, corruption has a significant...

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