Economic Integration and Corruption - EU Enlargement in Western Balkans
Economic Integration and Corruption - EU Enlargement in Western Balkans

Summary/Abstract: The paper examines possible EU enlargement in Western Balkans from the point of view corruption. Transparency International warns from the risks of acceleration and spreading of corruption in economic integration between states with different levels of integrity, and draws ambitious guidelines for optimal anticorruption policy. The paper aims for policy advices concerning proper anticorruption policy. The method is, first, to compare the candidate states to the current 28 EU states in terms of corruption and the quality of governance. Second, the paper surveys relevant economic literature on the macroeconomic effects of corruption, which shows that in countries, that are imprinted by both corruption and bad governance, particularly in terms of rule of law and government effectiveness, a straightforward attack on corruption is hopeless, and it may even be economically detrimental. The conclusion is that following the guidelines given by Transparency International is a too winding path to take, and it is almost impossible to set integrity as a precondition for entry. Optimal policy to avoid the contagion of corruption is to focus not on the candidates, but on the existing EU28, and particularly on close neighbors of the candidates. This can be done best by concentrating on international business transactions, namely by strict enforcement of the OECD anticorruption convention. The EU should pressure all member countries to uniform commitment to that project. After the entrance, the rooting out of corruption and the enhancement of formal governance in the new member states can then be carried out in due course.

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