WASHINGTON (Reuters) - The World Bank will work with the United Nations and other agencies in a global drive to help developing countries recover assets stolen by corrupt leaders, the Bank said on Sunday, estimating that the extent of graft in poor states could reach $800 billion (402 billion pounds) a year.
The Stolen Asset Recovery (StAR) Initiative will bring the World Bank together with the U.N. Office on Drugs and Crime (UNODC) in partnerships with the International Monetary Fund, the Organisation for Economic Cooperation and Development, the Group of Eight and developing countries, the Bank said.
World Bank President Paul Wolfowitz called the effort to recover assets stolen and stashed away by corrupt former leaders “a moral obligation,” the Bank said in a statement.
“Recovering even a portion of the stolen assets will help fund development and social programs, or badly needed infrastructure,” he told officials at the spring meetings of the Bank and the IMF in Washington.
Wolfowitz is under fire for his handling of the high-paying promotion of his girlfriend at the Bank, with critics warning his troubles have hurt the credibility of the World Bank’s high-profile Governance and Anti-Corruption Strategy.
The World Bank said annual proceeds from cross-border crime, corruption and tax evasion ranged from $1 trillion to $1.6 trillion, of which half involved developing countries and former communist states that are shifting to market economies.
Bribes received by public officials from these developing and transition countries totalled $20-40 billion, the Bank said, calling this an imprecise estimate that nevertheless underscored the need for urgent global action.
The corruption watchdog Transparency International has estimated that former Indonesian leader Suharto embezzled $15-35 billion from his country, while deceased former leaders Ferdinand Marcos of the Philippines, Mobutu Sese Seko of the former Zaire and Sani Abacha of Nigeria pocketed up to $5 billion each.
In 2004, the African Union said that Africa loses an annual $148 billion -- 25 percent of GDP -- to corruption. U.N. agencies said that in 1990s, corrupt officials in Nigeria embezzled some $5.5 billion, while more than $3 billion was been lost to corruption in Kenya.
Bank officials and world ministers discussed a range of measures, including programs to help poor states develop legal systems to recover stolen assets and a campaign to persuade all countries to ratify the U.N. Convention Against Corruption.
The 2003 Convention against Corruption has been signed by 140 countries and ratified by 91, U.N. data showed.
Our Standards: The Thomson Reuters Trust Principles.