Summary

The case involves dealing with corruption in China which has been at its highest point. Issues of corruption are evident and integral part of life among the Chinese community. According to Transparency International, the country’s Corruption Perception Index (CPI) is 3.6. It is also worth noting that the country is also ranked position 75 out of the 183 countries ranked. New Zealand is rated as the least corrupt country with CPI of 9.5 and number of all the countries ranked. However, the corruption index for China is far better as compared to North Korea and Somali which are the most corrupt countries.  The article is mainly concerned with cases of corruption and other economic crimes committed in the country.

The government of China is committed to fighting the vice that has been on the rise in the country.  It is asserted that the government is putting in place measures that will help fight the escalating issues of corruption. The Communist Party of China is a source of hope that the government is committed to dealing with the vice. Communist Party of China introduced the“10 Taboos” aimed at reducing actions of bribery and financial misappropriation (Narayan & Nguyen, 2015). These taboos outlined the major forms of corruption deals that most officials engage in and amounts to corruption. It is argued that the annual general meeting of this communist party was a clear indication of government commitment to fight corruption. The case study also notes that the issue of corruption is not only among the domestic companies but also is concerned with the foreign business community.

The case study also analyzes major forms of corruption that the foreign business community engages in corrupt deals.  It has been noted that most foreign traders make several payments to facilitate sales in China. Most foreign traders organize foreign trips, cash and gifts to Chinese officials to ensure that they increase sales in China. This claim has been ascertained by executives of senior traders who organize these trips to induce officials for business gains. Angling for cash is another major form of corruption that foreign traders exercise with Chinese officials. Some international companies offer to sponsor overseas education for the children of the officials in question.  It is noted that many firms have paid illegal cash payments to get an advantage in trade.

The case study has also given an illustration of how such corruption deals happen. The case outline excerpts from trial concerning Chinese bank, consultant and several US companies which faced charges of bribery and other economic crimes. These exceptions serve a great role in giving a picture of the several types of behavior that arise where bribery is rampant.  It is also in these excerpts that we learn of the substantive amount of money that foreign traders pay to officials and consultant to pursue certain business deals (Narayan & Nguyen, 2015).  The case study concludes by making comments on how best to deal with corruption. Comments from the U.S. consultant and former U.S. service agent agree that corruption is a threat to national security and is systemic. They also agree that the government should be proactive in dealing with this menace that has resulted in dismal and unequal business participation. The comments suggest that collaborative efforts between China and the united state will be key to victory in the fight against corruption.

Problem identification

As aforementioned, the country of China has identified that corruption level in this country has been at its peak. What actions should the government of China take to curb corruption both at domestic and international level? This is an essential question that the federal government will have to address to stem the increasing cases of corruption in the country. The country’s corruption index is rated very high, and something has to be made swiftly to return normalcy. China would be happy to get to levels of New Zealand which is rated as the least corrupt country according to Transparency International.

Issuing of notice and regulations by the communist party of China is a good step in the right direction from the government of China. The party has put in place internal controls and disciplinary penalties that are hoped to reduce corruption to manageable levels (Narayan & Nguyen, 2015). Strong taboos on perpetrators of bribery, corruption, and other economic crimes could be the solution to this thorny issue among the Chinese. It helps to define the major forms of corruption, and this makes it easy to determine instances of corruption and take appropriate action.  It is also imperative noting that the country has also established the different forms of corruption from foreign traders to Chinese officials. Angling for cash and paying to improve business are some of the common types of corruption by foreign traders. Identifying such issues will be critical in dealing with the escalating cases of corruption both at domestic and international level.

Alternatives

It has been noted that corruption in China is real and a national plague to the country’s economy.  It is, therefore, prudent that the government remain proactive in dealing with the issue of corruption to redeem the country’s lost glory. It has been argued that one of the major steps taken by the government is the formation of the Communist Party of China and the internal supervision and penalties on corruption (Narayan & Nguyen, 2015). The introduction of the “10 Taboos” is a step forward in the fight against corruption as it instills fear among the Chinese. Many people will fear to commit economic crime for fear of facing the harsh penalties as outlined in the regulations and guidelines of the Communist. The Chinese population is also in fear not to be caught by the supervisors as provided for in the guidelines.

Although the provision of the communist party will reduce the cases of corruption substantially, this alternative will have some limitations. For instance, the communist’s guidelines fail to address the prevention measures but instead have focused dealing with crime that has already been committed. The provisions only require supervision but fail to address how to have essential control measures to reduce corruption. Also, the harsh penalties to be handed to the perpetrators of economic crime can only be through court judgments. It is, however, wise understanding that the communist’s definition of corruption may not be the same as the legal definition. Perpetrators of economic crime will always circumvent the law to suit their selfish interests thus their crime going unnoticed. The country’s judicial system and other investigative departments must show good will in the fight against corruption. Although the “10 Taboos” gives a list of crimes that entails corruption, there are several loopholes that criminals will use to justify their actions (Narayan & Nguyen, 2015). The communist party is also mainly concerned with domestic corruption in total negligence of the foreign traders who are also vulnerable to corruption activities.

The “Criminal Law of the PRC,” is another option that the government intends to adopt in its fight against corruption. This is a more comprehensive law that applies to bribery of state officials and employees of state-owned enterprises. The law holds responsible any person who gives or receives bribes for business favors. It is imperative noting that unlike the ‘’taboos’’ and the communist provision, this law is concerned with both domestic and international corruption about China. Nevertheless, the law also wants to deal with an already committed crime and corrupt official are always determined to find a way out. It is worth noting that the law will only convict a person who has been found guilty of bribery, and it is not an easy task.

The “Law against Unfair Competition of the PRC,” known as commercial bribery is another effort that the government is making to reduce cases of corruption in the country. This law intends to discourage businesses from giving money or property to customers to sell or purchase products (Cheng Wenhao, 2011). It is, however, imperative noting that the law also lacks an essential definition of what exactly entails corruption. For instance, gifts and other payments made can be argued to be genuine payments thus making it difficult holding someone responsible. The law also fails to address how to get effectively hold of corrupt officials especially for foreign traders especially on the foreigner who will engage in corruption from his/her home country. Nevertheless, the law can instill fear to foreign traders to get involved in corrupt deals that would deny them business and also lead them to jail.

Recommendation

From the above analysis, it is clear that corruption is a major issue to the Republic of China and also a threat to the social and institutional fabric. It is, therefore, imperative for the country to take the pro active measures that will lead to reduced corruption level in the country. Nevertheless, harsh penalties and locking people in jail will not be the solution to the ever increasing cases of corruption in the country. After all, people have learned ways of circumventing the law to suit their demands, and this makes them fearless as far as going to jail is concerned. It is, however, wise for the government to adopt a strategy that will increase benefits of being honest and costs of being corrupt a sensible combination of reward and punishment the driving force of reforms.  It is recommended that the corruption demand side should be addressed to reduce supply (Cheng Wenhao, 2011). Offering better payment to officials, reducing red tape and increasing transparency will be critical in reducing corruption in China.  Also, the country should also engage in international conventions with foreign partners to reduce instances of international corruption that are also evident in the country. In essence, the country is recommended to have internal control measures aimed at prevention rather than dealing with a crime that has already been accomplished.

References

Cheng Wenhao,. (2011). Implementing international laws to fight business bribery: Case of the Organization for Economic Co-operation and Development (OECD) anti-bribery convention. Afr. J. Bus. Manage., 5(32). http://dx.doi.org/10.5897/ajbm11.1218

Narayan, S., & Nguyen, T. (2015). Does the trade gravity model depend on trading partners? Some evidence from Vietnam and her 54 trading partners. International Review Of Economics & Finance. http://dx.doi.org/10.1016/j.iref.2015.08.010

 
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