[Democracy Promotion Special Report] International Efforts for Anti-Corruption in Korea and Democracy Assistance

I. Introduction

Recently, international discussions on anti-corruption have intensified. In 2021, the UN General Assembly held its first-ever special session on corruption, urging international cooperation for corruption prevention and eradication. U.S. President Biden considers anti-corruption a key issue in countering threats from authoritarian regimes and protecting human rights worldwide, thus prioritizing it as one of the pillars of U.S. foreign policy alongside countering authoritarianism and promoting human rights domestically and internationally. Consequently, corruption eradication was a core agenda item at the first Summit for Democracy in 2021, and the United States Agency for International Development (USAID) established an Anti-Corruption Task Force to combat corruption. The South Korean government also focused on "Challenges and Achievements in Combating Corruption" as a theme for the Indo-Pacific regional meeting of the second Summit for Democracy held in March 2023.

The growing international attention to anti-corruption is underpinned by a global consensus on its negative impacts and robust international norms for its prevention and punishment. Corruption is widely regarded as the biggest obstacle hindering political, economic, and social development worldwide. It leads to the waste of human talent and resources, increases the costs of domestic and international economic transactions, and stifles productive activities. This results in increased economic inefficiency and hinders economic growth. Furthermore, the economic losses caused by corruption disproportionately harm the poor, exacerbating economic inequality, as public investment in essential services like health and education declines when corruption is rampant. A more significant problem is that the negative impacts of corruption extend beyond the economic sphere, corrupting the quality of governance across society. For instance, corrupt practices like vote-buying distort democratic processes, and bribery obstructs fair law enforcement and undermines judicial justice. Rampant corruption can dismantle the rule of law and democracy, fostering public distrust in existing systems and institutions, thereby weakening the legitimacy of the political system. Ultimately, corruption acts as a major impediment to achieving the sustainable development emphasized by the international community.

Corruption has recently garnered particular attention not only because it is a key mechanism enabling authoritarian regimes to perpetuate human rights abuses but also because authoritarian regimes have been observed weaponizing corruption against democratic states. Dictators and ruling elites use corruption to privatize state resources, plunder the private sector to enrich themselves, and secure resources to suppress political opposition and citizens. Furthermore, authoritarian states like Russia and China strategically leverage corruption to co-opt influential individuals in target countries or to influence policy-making processes and elections in other countries through covert lobbying activities.

Consequently, anti-corruption is no longer considered a domestic issue but an international one that requires cooperation and collaboration among multiple nations. Numerous international organizations have made anti-corruption a core agenda item, emphasizing corruption prevention and eradication. This paper examines international efforts to combat corruption and discusses the relationship between anti-corruption and democracy assistance. Based on this, it reviews the current status of international support and cooperation for anti-corruption by the South Korean government.

II. International Efforts for Anti-Corruption

International efforts to combat corruption are multifaceted. The most significant and influential international effort to date has been the conclusion of the United Nations Convention against Corruption (UNCAC), which is a legally binding international treaty, not merely a declaration. This convention establishes universal anti-corruption norms applicable to both developed and developing countries, as well as the public and private sectors, and covers a broad range of issues. In contrast, the "OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions" (hereinafter referred to as the OECD Anti-Bribery Convention), concluded in 1997, aims to prevent bribery in international business transactions and represents the first international agreement to criminalize such acts. Unlike other OECD norms, the Anti-Bribery Convention holds significant importance as an international treaty with legally binding force on its member states.

In addition, regional organizations such as the European Union, the Organization of American States, and the African Union have adopted international conventions against corruption. Furthermore, international organizations like the World Bank, the International Monetary Fund (IMF), and other UN development-related agencies have policies to reduce lending to countries where evidence of bribery emerges or to impose sanctions on companies that secure contracts through bribery.

Civil society-led international efforts have also made significant contributions to shaping anti-corruption norms. Transparency International, in particular, as a transnational civil society organization, has raised global awareness of corruption issues and has been at the forefront of corruption prevention efforts in cooperation with international organizations. Subsequently, numerous non-governmental organizations (NGOs) and business associations have advocated for anti-corruption, disseminating codes of conduct and principles. For example, the Extractive Industries Transparency Initiative (EITI) is a movement to increase transparency in natural resource revenues, involving governments, companies, civil society organizations, investors, and international organizations. While EITI is based on voluntary participation, participating countries must fully disclose information on revenues generated from extractive industries. These revenues undergo a reconciliation process compared to the amounts provided by companies involved in extraction. This aims to address issues of illicit backroom deals, unfair revenue distribution, and environmental pollution.

More recently, with the increasing emphasis on the importance of civil society participation in anti-corruption efforts, international public-private partnerships comprising civil society and member governments have been launched. A prime example is the Open Government Partnership (OGP). The OGP is an international multi-stakeholder initiative that advocates for corruption eradication, enhanced government transparency, and increased citizen participation. Since its establishment in 2011, it has involved 75 national governments, 104 subnational governments, and thousands of civil society organizations.

III. The Core Logic of Anti-Corruption

Most anti-corruption efforts focus on enhancing transparency and accountability. The emphasis on transparency is based on the assumption that corruption arises from institutional opacity and limited information disclosure. The more opaque policy-making processes and administrative procedures are, the greater the information asymmetry between the government and citizens, creating more opportunities for corrupt acts using insider information and reducing the likelihood of detecting and punishing corruption. Conversely, increased transparency breaks down the monopoly of information held by public officials, reducing opportunities and resources for corruption, while simultaneously providing more information at a lower cost to actors motivated to monitor corruption, thereby increasing the chances of detecting and punishing corrupt acts. Therefore, institutional reforms such as the introduction of freedom of information laws, expansion of administrative information disclosure, implementation of citizen auditor systems, online complaint processing systems, electronic bidding, and transparency in financial reporting and political fund accounting have been emphasized as crucial anti-corruption policies to enhance the transparency of public administration and citizens' access to information.

However, enhancing transparency alone is insufficient to change corrupt behavior. Even if information about corruption becomes known, mechanisms to punish those involved may be absent, and collective action problems may arise in enforcing punishments. Therefore, transparency can only lead to reduced corruption when linked with robust accountability mechanisms. Strong accountability is not achieved merely by increasing monitoring of corruption and the severity of punishments. The accountability mechanism functions only when citizens can understand and access information about corruption, form collective actions for anti-corruption based on this understanding, and when institutional arrangements exist to translate citizens' demands for anti-corruption into feasible reforms. Accountability is not guaranteed solely by citizens replacing corrupt governments through elections. For effective accountability, citizens must routinely participate in the decision-making processes of public policy and act as watchdogs of state operations.

This logic is consistent with the concept of a National Integrity System developed by Transparency International to prevent corruption. A National Integrity System is a system that involves government, civil society, and other stakeholders to enhance transparency and accountability for successful corruption prevention. It posits that a successful anti-corruption system can only be built when the executive, legislative, and judicial branches, law enforcement agencies, anti-corruption bodies, political parties, civil society, the media, and businesses all participate in a collective effort to strengthen transparency and accountability. It requires comprehensive anti-corruption efforts involving mutual cooperation among relevant actors, rather than focusing solely on specific sectors. It also emphasizes active participation in anti-corruption efforts within the private sector, not just the public sector.

IV. Anti-Corruption and Democracy Assistance

The preceding discussion demonstrates that, as Francis Fukuyama argues, anti-corruption is essentially a political phenomenon and can only be eradicated through political mechanisms, not technocratic ones. Recent research on corruption emphasizes that for successful anti-corruption, a transition to democracy and a deepening of democratic quality are essential, going beyond institutional reforms in public administration. This is because, in countries where corruption is rampant, leaders and elites often lack the incentive and will to achieve anti-corruption. As the primary beneficiaries of the existing corrupt system, they have no reason to eradicate corruption. In such situations, successful corruption eradication is impossible without replacing the existing elites. Merely adopting anti-corruption measures recommended by international organizations, such as freedom of information laws, e-government, and citizen auditor systems, will not bring about fundamental change. The establishment of independent anti-corruption agencies is similarly insufficient, as they can be easily neutralized by those in power.

Therefore, for anti-corruption to succeed, existing elites must be made to continuously focus on corruption eradication as a symbol of modernization, or newly replaced elites must be able to gain political benefits, such as legitimacy, through anti-corruption reforms. South Korea's experience with anti-corruption falls into the latter category: democratization prompted reformist governments to actively pursue institutionalization for anti-corruption, sometimes independently and sometimes in cooperation with civil society. As democracy developed stably, citizens' demands for anti-corruption became more diverse, and the government's responsiveness to these demands increased, creating a virtuous cycle of anti-corruption.

The success of anti-corruption is not realized simply by establishing laws and systems for corruption prevention and punishment. It requires the establishment of two fundamental accountability mechanisms of a democratic system: vertical accountability, through which corrupt governments and politicians can be punished via competitive elections, and horizontal accountability, through which power institutions check and balance each other, along with the rule of law. The higher the independence of the judiciary responsible for punishing corrupt acts and the better the rule of law operates, the more effectively the legislature monitors and oversees the executive branch, and the stronger the internal controls by state audit institutions, the lower the possibility of collusion among different power institutions and the more effectively power holders can be checked. Strong political coalitions for anti-corruption have helped strengthen these forms of accountability when corruption scandals erupt.

Consequently, international support for successful anti-corruption efforts is inevitably linked with democracy assistance. In the past, democracy assistance donors focused on institutional reforms such as administrative support for electoral processes, the establishment of independent electoral commissions, and judicial reform and strengthening the rule of law. However, recent assistance is increasingly directed towards directly strengthening so-called 'pro-democracy forces.' This includes supporting democracy education for citizens, enhancing civil society capacity through support for NGOs, and providing assistance to independent media. Ultimately, international support and cooperation for anti-corruption go hand in hand with democracy assistance.

V. Conclusion: South Korea's Anti-Corruption Assistance and Democracy Support

The discussion thus far provides important implications for the South Korean government's international anti-corruption assistance strategy. The South Korean government has actively participated in international anti-corruption efforts, continuously strengthening cooperation and collaboration with the international community. Firstly, the South Korean government has ratified the aforementioned OECD Anti-Bribery Convention and the UN Convention against Corruption, and has faithfully implemented these conventions by enacting and revising relevant domestic laws. In particular, the Anti-Corruption and Civil Rights Commission (ACRC), South Korea's independent anti-corruption oversight body, has actively participated in international anti-corruption discussions through forums such as the G20 Anti-Corruption Working Group, the Asia-Pacific Economic Cooperation (APEC) Anti-Corruption and Transparency Working Group, the OECD Public Integrity Working Party and Integrity Forum, and the International Anti-Corruption Conference (IACC). Through these opportunities, South Korea has promoted its anti-corruption efforts and achievements to the international community and contributed to the establishment and development of international anti-corruption regimes. Furthermore, the ACRC has signed Memoranda of Understanding (MOUs) with the United Nations Development Programme (UNDP) and individual countries, supporting developing countries like Vietnam, Uzbekistan, and Kosovo in adopting key corruption prevention systems developed by the ACRC. Following the Indo-Pacific regional meeting of the second Summit for Democracy, South Korea has been providing training programs for public officials from developing countries on anti-corruption strategy development, corruption prevention, and corruption investigation, as well as customized national anti-corruption policy training.

While support for establishing anti-corruption systems in developing countries is undeniably a significant contribution, a re-evaluation of South Korea's anti-corruption assistance policies seems necessary given the growing demand for the country to take a more active role in promoting and expanding democracy internationally. In this regard, the following proposals are presented:

First, the South Korean government needs to conduct its international anti-corruption assistance by broadening the scope and objectives beyond strengthening institutional anti-corruption capacity to include democracy assistance. This requires increasing the proportion of democracy governance support in South Korea's Official Development Assistance (ODA) and international cooperation projects. Although the South Korean government has not directly provided international aid under the banner of 'democracy aid,' support in areas related to democratic governance has been provided individually by various ministries. However, these constitute a very small portion of the total ODA, and most support has focused on improving public administration and electoral systems. To enhance democratic governance for successful anti-corruption, it is necessary to expand anti-corruption and democracy assistance by focusing more on strengthening civil society capacity and leadership, and institutional enhancements for promoting transparency and accountability, going beyond the current areas of focus.

Second, cooperation with civil society in partner countries must be strengthened. Establishing anti-corruption norms and systems solely through exchanges with partner country governments is a distant prospect. This is particularly important because corruption is a product of society reflecting the political system, laws, economy, and culture of the local community, making it crucial to utilize the working knowledge of local actors. Exchanges and cooperation are needed with various private actors involved in anti-corruption, such as local anti-corruption NGOs, business and labor unions, and media representatives. If it is diplomatically difficult and politically sensitive for the South Korean government to directly demand improvements in political systems and strengthening of civil society capacity from partner country governments, then indirectly contributing to anti-corruption by supporting civil society is also an option. However, current ODA practices, which are based on intergovernmental agreements, make this approach difficult. In such cases, strengthening the capacity of civil society in partner countries and supporting anti-corruption efforts through intergovernmental or non-governmental international organizations engaged in anti-corruption activities could be a viable approach. Cooperation with international organizations and other leading donor countries in international activities for democracy support, not just anti-corruption, would significantly help in nurturing our expertise.

Finally, a division of roles for anti-corruption support could be attempted. The ACRC could continue to focus on supporting the strengthening of institutional and technical capacity for anti-corruption, while a separate, non-partisan, independent institution could be established to handle anti-corruption support related to democracy enhancement. Such an independent institution would build a system capable of developing anti-corruption aid strategies through public-private partnerships with various civil society actors, distinct from existing government-led support programs. To this end, establishing overseas democracy support foundations, similar to the National Endowment for Democracy, which is supported bi-partisanly by the U.S. Congress, or the Westminster Foundation for Democracy, operated by the UK Parliament with financial support from the Foreign Office, could be explored. This is because democracy support programs can be conducted more freely in a public-private partnership format.

To secure stable funding for such a foundation, legislative efforts by the National Assembly are required. In March 2023, Representative Ha Tae-keung already proposed an amendment to the Act on the Establishment and Operation of the Korea Democracy Foundation (amendment to the Act on the Memorial Project for Democratization Movement), renaming the Memorial Project for Democratization Movement as the Korea Democracy Foundation and adding "International Cooperation Projects for the Development of Democracy" to its scope of activities. While this bill is undoubtedly an important piece of legislation for democracy support, legislation is needed for sustained democracy support based on stable financial resources. In particular, the establishment of a fund for a democracy support foundation is necessary. Funds are established by law when 'the state needs to flexibly manage specific funds for a specific purpose,' and unlike special accounts with similar characteristics, they can be operated outside the budget for revenue and expenditure. Funds have the advantage of guaranteeing the autonomy of the foundation's operating body and providing flexibility to modify parts of the plan during project execution. Therefore, active and in-depth discussions are needed in the National Assembly regarding the foundational law for the establishment fund of a democracy support foundation, how to secure stable financial resources, whether separate revenue generation is possible, how to define the foundation's nature, who should be the operating and managing body, and who the beneficiaries should be. ■

■ Kim Nam-gyu_Professor of Political Science and International Relations, Korea University.

■ Editor: Oh Joon-chul_EAI Research Assistant

Inquiries: 02 2277 1683 (ext. 205) | jcoh@eai.or.kr