A group of MEPs has called on the European Commission to pass legislation that will give EU member states the powers they need to effectively fight corruption and organized criminality. Urging the Commission to revive a 2013 European Action Plan designed to tackle organized crime in the 28-nation bloc, the parliamentarians passed a resolution this week that insists the issue be made a political priority.
The MEP’s demands come not a moment before time. When the action plan was first drafted three years ago by the Committee on Organized Crime, Corruption and Money Laundering (CRIM), Europol estimated that some 3,600 organized criminal groups were operating on the continent, involved in a range of activities including drug trafficking, people smuggling and fraud. According to a 2015 study from the Organized Crime Portfolio (OCP), the EU’s criminal markets generate an estimated €110 billion every year, the equivalent of 1% of the union’s GDP.
The problem is particularly pervasive in Eastern Europe, where institutionalized corruption is proving difficult to stamp out. Although Eastern European nations have shown some improvement over recent years, Transparency International’s global corruption index shows they are still lagging well behind their western neighbors by some margin – and in many cases public sector corruption is holding them back.
Institutionalized corruption not only harms society through the embezzlement of investments and public sector funds, but also leads to a brain drain as the young feel compelled to leave countries that are being ruined by the greed of their leaders and officials. The fact that the equivalent of 1% of the union’s productivity is generated by organized crime demonstrates perfectly how the bloc’s economic recovery is being slowed by corruption and crime. This is precisely why the MSP’s demands for action need to be met, and soon.
A RAND Europe study released in March this year estimated that corruption costs the EU up to €990 billion annually, a figure that dwarfs the OCP’s 2015 estimation of the cost of organized crime in Europe. RAND researchers found that Romania, Bulgaria, Croatia and Latvia were the most corrupt countries in Europe, with Slovakia, the Czech Republic, Poland and Lithuania coming not far behind.
In Hungary, the ruling Fidesz party has systematically hijacked the state, squandering public funds on pet projects that benefit the political elite and their allies. There has even been suggestions that Hungarian officials have misused anti-corruption funds. The embezzlement of public funds in Hungary has become so widespread and generally acknowledged that two-thirds of the country’s electorate believe their rulers are “very corrupt.”
A September 2015 report from the European Court of Auditors found that 12 of the union’s 28 member states were failing to meet the required standards for public procurement. The problem is particularly acute in Poland, where officials dish out large public sector contracts without opening them up to tender. According to the GAN Business Anti-Corruption Portal, the Polish political system is rife with cronyism and nepotism, which the government refuses to challenge. Polish officials accused of crimes including money laundering, bribery and embezzlement rarely face prosecution.
Romania, which is consistently ranked among the most corrupt nations in Europe, is currently in the middle of a massive Washington-instigated crackdown on shady dealings among its political class, a move that has put many of the nation’s most powerful figures’ noses out of joint. Last month, an investigation was launched into allegations that the country’s former Prime Minister Victor Ponta gave a parliamentary seat to a prominent businessman who brokered a visit from former British leader Tony Blair to Romania. Weeks later, the leader of Romania’s liberal party stepped down after he was questioned by prosecutors over corruption charges. Vasile Blaga was accused of awarding a contract after receiving a large bribe. Despite the crackdown, corruption is still a major problem in Romania.
Similar high-level palm-greasing persists in Lithuania, where French water and waste group Veolia’s local subsidiary Dalkia won a 15-year lease on the country’s heating infrastructure thanks to a campaign of bribery, intimidation and violence. While Lithuania has been praised for its efforts to clampdown on corruption, the details of the Veolia case demonstrate that the country still has a long way to go.
If implemented, the action plan revived by MEPs this week could result in legislation that would force eastern European countries to become more open and accountable. Without some form of concerted effort from the EU, it is highly unlikely that these countries will get their houses in order off their own backs. Extortion, bribery and embezzlement are equally as serious as drug trafficking, people smuggling and the growing problem of large-scale cybercrime. It is high time Europe started addressing the threat posed by all forms of organised crime, whether they are committed by violent gangsters, or crooked politicians and officials.