Pretor Business Coll ege

School of Business and Construction

Management
Department of Business Administration
Individual Assignment

Instructor

Name
ID No

MAY, 2024

ADDIS ABABA, ETHIOPIA

 The level of magnitude of corruption in Ethiopia

Corruption comes from a Latin word ‘corrumpere’ which means to break something and during
the action of corruption, the law, legal rule , a moral norm and in worse situations communities
and human personalities are broken (Farida,2006). A broad definition of public sector corruption
is the abuse of authority by bureaucratic officials who exploit their powers of discretion,
delegated to them by the government, to further their own interests by engaging in illegal, or
unauthorized, rent-seeking activities(Blackburn, Bose, & Haque, 2005).The World Bank extends
the definition of office corruption to include the offering, giving, receiving or soliciting, directly
or indirectly anything of value to influence the action of a public official in the procurement
process or in contract execution (World Bank, 2004). There are several sectors in Ethiopia where
businesses are particularly vulnerable to corruption. Land distribution and administration is a
sector where corruption is institutionalized, and facilitation payments as well as bribes are often
demanded from businesses when they deal with land-related issues.

\Corruption lowers the standard of living and decreases the amount of wealth in a country by
undermining trust in government, working in favor of the rich and against the poor, worsening
the quality and reliability of public service delivery, and discouraging business thereby hurting a
nation’s development (Thai, 2008). Corruption can be disempowering to the people and
encourage their sense of alienation by undermining respect for authority and increasing cynicism
about leaders at all levels of society (Mastruzzi,2005). Political scandals have sparked public
outrage against political corruption in countries across the globe, and in every continent at least
one incumbent regime has been forced out of office under a cloud (Mauro, 1995)

Corruption also occurs when businesses obtain permits and licenses due to complicated
bureaucracy. Public procurement is also seriously hampered by corruption, and different types of
irregularities exist, such as non-transparent tender processes and awarding contracts to people
with close connection to the government and ruling party.

On Transparency International's 2022 Corruption Perceptions Index, Ethiopia scored 38 on a

scale from 0 ("highly corrupt") to 100 ("very clean"). When ranked by score, Ethiopia ranked
94th among the 180 countries in the Index, where the country ranked first is perceived to have
the most honest public sector. For comparison, the best score was 90 (ranked 1), and the worst
score was 12 (ranked 180).

On Transparency International's 2023 Corruption Perceptions Index, Ethiopia scored 37 on a

scale from 0 ("highly corrupt") to 100 ("very clean"). When ranked by score, Ethiopia ranked
98th among the 180 countries in the Index, where the country ranked first is perceived to have
the most honest public sector. For comparison with worldwide scores, the best score was 90
(ranked 1), the average score was 43, and the worst score was 11 (ranked 180). For comparison
with regional scores, the average score among sub-Saharan African countries was 33. The
highest score in sub-Saharan Africa was 71 and the lowest score was 11

Corruption arises from institutional attributes of the state and societal attitudes toward formal
political processes. Institutional attributes that encourage corruption include wide authority of the
state, which offers significant opportunities for corruption; minimal accountability, which
reduces the cost of corrupt behavior; and perverse incentives in government employment, which
induce self-serving rather than public-serving behavior. Societal attitudes fostering corruption
include allegiance to personal loyalties over objective rules, low legitimacy of government, and
dominance of a political party or ruling elite over political and economic processes. Possible
responses to these underlying sources of corruption include institutional reforms to limit
authority, improvement of accountability, and realignment of incentives, as well as societal
reforms to change attitudes and mobilize political will for sustained anticorruption interventions.
Strategy choices must be made after taking into account the nature of the corruption problem and
the opportunities and constraints for addressing it. Because a strategy must be tailored to fit the
particular circumstances of a local government, designing a strategy requires assessing the level,
forms, and sources of corruption for the country as a whole and for specific government
institutions. In particular, strategy formulation requires taking a hard look at the level of political
will for anti-corruption reform in government and civil society. Opportunities for reform can
stem from reformists’ tendencies within the government, a change in government, public outrage
over scandals, an opposition movement, an economic crisis, or external pressure. It is also
essential to take careful stock of potential supporters and opponents within the ruling parties, the
opposition, the judiciary, and the military, among others. The assessment must consider each
party's interests and motivations and how these might play into an anti-corruption strategy. If
there is little or no opening to work in anti-corruption, the strategy should focus on societal
measures to increase awareness of the problem and develop a constituency for reform. However,
if openings are partial or significant, the strategy should combine societal reforms to
institutionalize political will with targeted institutional reforms.

The strategy should target institutions where the problem of corruption is serious. Coordination
with other multilateral and bilateral organizations and NGOs is critical to curb corruption
problem. Like many developing countries, Ethiopia has tried several strategies in an effort to
minimize levels of bureaucratic corruption. These include societal, legal, market, and political
strategies. All those approaches to corruption clean up represent the manipulation of outcomes
within a given set of rules and presuppose the existence of efficient counteracting institutions.
The evidence shows, however, that most judiciary systems and police forces in the African
countries are not properly constrained by the law and that most civil servants (including judges
and police officers) were themselves corrupt. As a result, most clean-up programs in the country
have been unsuccessful. Public corruption is an outcome generated within a given set of rules.
An effective normative evaluation of such an outcome can only be undertaken after a thorough
understanding of the rules that generate the outcome. Thus, to understand why people engage in
corruption requires an examination of the rules that regulate the socio-political behavior of
individuals.

Since these rules determine how individuals behave and relate to each other, they also determine
the outcomes to be generated in the post-contractual society. Since the rules determine the
incentive system that will prevail in the post-contractual society, society can effectively impose
the outcomes it wants through rules design. For example, the problem of overgrazing of
agricultural lands can be minimized by establishing private property rights in land during rules
selection. Usually, the establishment of political rules and a political order precede the
establishment of an economic order. The rules of political order include the "definition of the
rights of persons, [and] can be legitimately derived only from the agreement among individuals
as members of the polity” (Brennan and Buchanan 1985: 26). The rights of persons are not
defined by the government. Instead, individuals or members of society form governments to
protect and guarantee their rights as defined and agreed upon in the social or constitutional
contract. Any attempt by the government to modify or abrogate those rights invariably violates
the basic rules. It is important to note that problems of control in the post-constitutional society
do exist. Inestablishing the polity, the government is granted the power to monopolize legitimate
force. Once established, government may try to exceed the limits of the authority delegated it by
the people--and if it does, it may render itself illegitimat

Conclusion

The World Bank Study in Ethiopia found that corruption is the most challenging problem that all
households face after poverty (WB, 2005). Corruption negatively affects the on-going poverty
reduction programme and democratization processes of the country. Violating building codes
through the connivance of corrupt officials and building contractors has resulted in loss of human
Impacts of Corruption 5 5 lives, road accidents and collapse of buildings. Failure to observe
proper fire prevention and safety regulations has caused supermarkets, hotels and discos, filled
with shoppers and customers to go up in flames. Ethiopia is slipping back far behind the
GTP(Growth &Transformation Programed) and MDG(Millennium Development Goals ) goals
set for 2015 so that the Government needs to do more to fight corruption to attain at least the
average score (UNCTAD, 2010).

There was a general consensus that corruption is one of the biggest challenges that in Ethiopia
must overcome to have any real chance of development of the Administration. The sources of
corruption, however, still remain a point of dispute. Lack of conclusive data and the great
variation of results indicate that there is a great need for more researches as to complement this
complex and pressing issue. Developing realistic pay levels and other benefit packages for the
civil service seems an essential one to alleviate corruption in public sector although it is beyond
the scope of this paper to recommend specifically what form of a pay strategy should be taken.
The government’s vision of an ethical, motivated, competent, and non-corrupt civil service may
come about with fundamental improvements in pay levels and job security.
Reference

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 "The ABCs of the CPI: How the Corruption Perceptions Index is calculated" .
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 "The ABCs of the CPI: How the Corruption Perceptions Index is calculated" .
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