Corruption in Indonesia and China

This comes in the midst of managing a political transition. Third, the World Bank has recently earmarked $14 billion in aid to help Indonesia manages its economic crisis, but, as the director of the World Bank East Asia and Pacific Region notes, "Without the assurance of the fundamental soundness and freedom from corruption of government programs, the continued support by the World Bank, and international community, cannot be guaranteed" (Marshall, 1998, 2).
Corruption is detrimental to Indonesia in many ways. High levels of corruption have thwarted economic and social development, have pushed many Indonesians into poverty, and currently threaten the stability of the nation. One of the biggest causes for corruption in Indonesia is quite similar to a major cause of corruption in China, the complete lack of practices and procedures that act as a check on government power. Very little accountability exists for government actions in either country. Indonesian corruption is so systemic that Transparency International ranked the country 80 of the 85 countries on its Corruption Perception Index, while the Political and Economic Risk Consultancy, Ltd. ranked Indonesia the most corrupt of twelve Asian countries considered (Harahap, 1999, 3).

The reforms needed in both Indonesia and China to reduce corruption must occur on the economic, legal, and political levels. Political institutions must become more democratic in both nations. Legal institutions must be reformed and economies must be made more open. In both countries the emerging markets are poorly institutionalized. According to Johnston (2002), "In advanced economies market activities take place within a legal, institutional and normative framework that, to a greater or lesser degree, both regulates and protects them from official exploitation" (6). Such a framework is sorely absent in both Indonesia and China.
The lack of a code of conduct for public officials makes many accept bribes as the normal mode of operation. Declarations of wealth or income are nonexistent and political officials can keep private business activities hidden. However, the government's response to the current crisis has been to seek help from the international community to devise anti-corruption policies that will eliminate KKN as a reality in Indonesian society.
Within the Sunshine Policy, 35 tasks are highlighted for fighting corruption. Other measures include an opening of administrative affairs, public recruitment of government officials, and auditing of officials while they hold office. Despite such public pronouncements and policies, many still doubt the willingness or ability of China's government to tackle the problem head-on in significant ways that actually reduce corruption. Despite billions of dollars gained through corrupt measures leaving China via capital flight, the government continues to insist on keeping financial activities of high-ranking political leaders veiled in silence.

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