UAE is a better place to do business

High-profile prosecutions and beefed-up financial tracking systems see Emirates edge past Israel, lag behind Qatar in Middle East.

NEW YORK // High-profile prosecutions of corrupt executives and beefed-up financial tracking systems have helped make the UAE a better place to do business, an anti-graft watchdog said in its annual global survey. The UAE moved up five places since last year to become the 30th least-corrupt country of the 180 assessed by businessmen and analysts in Transparency International's 2009 Corruption Perceptions Index.

That means the UAE has overtaken Israel (32) to become the Middle Eastern country perceived to be the least corrupt after Qatar (22). Globally, the list is topped by New Zealand (1), Denmark (2) and Singapore (3). "The 2009 index shows improvement in the scores of Qatar, the UAE, Oman, Bahrain and Jordan," the Berlin-based research group said. "It remains to be seen whether this is due to increased political will to fight corruption or whether the negative effects of corruption are being masked by large surpluses, particularly in the oil and gas-rich Gulf states, which are fuelling rapid economic development."

Tamara Kamhawi, the regional coordinator for Transparency International, said: "The fact that they decided to take measures to punish high-level officials in the UAE for misconduct and abusing their office is one step to show they are serious about these reforms. "After the financial crisis, we have seen a growing interest in transparency and accountability measures, which shows they are taking steps forward in this direction."

The anti-graft group undertakes the complicated task of assessing corruption levels in the public sector of a target country, grading on a scale of 0-10 based on a composite score from business surveys. The UAE scored 6.5 in this year's report, up from 5.9 last year, propelling the country upwards on a list that is dominated by European and other Western countries. The improvement comes only weeks after a Dubai judge handed down the longest term yet in the emirate's long-running corruption inquiry of Istithmar World, jailing a senior manager at the company for five years for embezzling $1.34 million (Dh4.9m). Dubai's massive anti-corruption inquiry, launched last year to fight a multi-billion-dirham fraud, was matched by Abu Dhabi last month announcing an eight-year training course for a new cadre of sleuths to crack down on financial crimes.

Huguette Labelle, the chairwoman of Transparency International, said governments must strengthen institutions against graft, particularly during a global recession that is being tackled with multi-billion-dollar public bailout packages. "Stemming corruption requires strong oversight by parliaments, a well performing judiciary, independent and properly resourced audit and anti-corruption agencies, vigorous law enforcement, transparency in public budgets, revenue and aid flows, as well as space for independent media and a vibrant civil society," she said.

While this year's list was topped by politically stable countries with traditions of regulation and sound public institutions, fragile and war-torn states continued to linger at the bottom of the scale. Somalia languishes at the bottom of the index with a score of 1.1, below Afghanistan (1.3) and Myanmar (1.4). [e-mail]