Recommendations to the OAS Special Committee

on Inter-American Summits Management:

Third Summit of the Americas

Chapter II Creating Prosperity



Thank you, Mr. Chairman, for providing Transparency International with the opportunity to contribute, once again, to the work of the OAS Special Committee on Inter-American Summits Management as it prepares for the Third Summit of the Americas. May we commend you and the members of the Committee for organizing this series of consultations with civil society.

Transparency International is an international non-governmental, non-partisan coalition dedicated to combating corruption and promoting government transparency and accountability. TI has over 70 chapters worldwide, with 17 in the Americas. I am the Managing Director of the US chapter, which has broad support in the corporate, legal, accounting, development and academic sectors.

Since the 1994 Miami Summit, there has been agreement that bribery and corruption are obstacles to creating prosperity in the hemisphere. Indeed, left unchecked, they can undermine all the worthy objectives of the Summit process, whether strengthening democracy, creating prosperity or realizing human potential.

The last time we had the honor to address this committee, we made recommendations for Chapter I: Strengthening Democracy. What is most striking is their similarity to those we respectfully put forward today for Chapter II: Creating Prosperity.

Transparency is as essential to strengthening democracy as it is to creating a hospitable business environment. Both require clear and predictable rules that are easily accessible and published in a timely fashion. Integrity and accountability of public officials is as essential to building public trust, as it is to trade and investment. And, just as corruption corrodes democracy, so it deters foreign investment and economic growth.

#1 - Set benchmarks and timetables for implementation

At the past two Summits, Leaders committed to a broad range of measures to increase transparency and accountability that could benefit both civil society and the private sector. The challenge at Quebec City is to set benchmarks and timetables for implementing those measures.

#2 - Accelerate the deadline for implementation of transparency-related measures

Particularly on measures to enhance transparency, it is in our mutual interest to move expeditiously and not to delay until the FTAA current deadline of 2005 or even the earlier deadline under discussion in 2003.

Leaders should agree to a clear and measurable set of transparency-related measures with accelerated timetables and assign responsibility so that progress can be assessed and officials held accountable.

#3 - Undertake Convention monitoring in 2001

Nowhere is this more critical than for the implementation and enforcement of the Inter-American Convention Against Corruption. If enforced, this Convention has the potential to reduce bribery and corruption as factors in trade and investment. Therefore, the OAS recommendation to create a monitoring mechanism should be supported by a call from leaders for its realization by a date certain, preferably by the June 2001 OAS General Assembly.

#4 - Institute a Summit implementation monitoring process

As to the other Summit commitments, a system of self and mutual evaluation of progress on implementation should be instituted at the Quebec City Summit with an annual progress report to ministers. This system should provide for consultation and cooperation with the private sector and other civil society groups and should make broad use of technology to disseminate information.

#5 - Enhance Civil Society Participation

Steps must be taken at the Summit to create an institutional mechanism for civil society consultation on the FTAA before and between summits that provides for broad outreach, more interaction with negotiators, and greater input to ministers. Opportunities for domestic participation are essential and need to be strengthened, but they are not a substitute for such a regional mechanism. Either the mandate of the FTAA Committee of Government Representatives on Civil Society Participation should be broadened to achieve these objectives or it should be disbanded.

As to specific transparency-related measures, Leaders should commit to take the following actions:


#6 - Require publication of information

Legal requirements should be promptly enacted to ensure the publication in writing and electronically, of all laws, regulations, judicial decisions, administrative guidelines and decisions, licensing requirements and other information regarding procurement, investment, services, customs and other relevant areas. A transparent, independent and timely appeals procedure should be available for erroneous or inequitable decisions.

#7 - Provide notice and opportunity for public comment

Proposed laws and regulations should be published and there should be an opportunity for public comment prior to implementation. Transparent review processes should be available.

#8 Enhance economic efficiency in public service

Codes of conduct, conflict of interest standards, and asset disclosure mechanisms should be instituted and sanctions for non-compliance should be enforced in order to promote merit-based decisions based on all trade and investment-related matters, including procurement and privatization.

#9 - Promote impartial judicial decisions

Procedures should be instituted and training provided to promote the independence and integrity of judges and prosecutors, including merit-based criteria for selection, public review of candidates, ethics training, and asset disclosure and oversight mechanisms.

#10 - Raise accounting and auditing practices

Accounting and auditing practices should be adopted that meet or exceed international standards and audits of all public institutions should be published.

#11 - Strengthen procurement transparency

Procurement legislation, practices and institutional, private sector and civic mechanisms must be strengthened to guarantee that public money is spent in the most efficient way. TI chapters in Latin America are currently engaged in the development of a single comprehensive framework to achieve this objective and will submit a detailed set of recommendations in the near future.

Transparent procurement procedures will promote competition and minimize the potential for irregular practices. Advances in technology have opened wider opportunities to enhance the transparency and efficiency of the process and should be exploited for this purpose.

Steps should be taken as soon as possible at the national and local level and should not depend on the final FTAA agreement. The multilateral development banks should provide assistance where needed.

Many of the necessary elements of transparency are set out in the draft WTO Agreement on Transparency in Procurement that was agreed to prior to the Seattle meeting. They build on those in the WTO Government Procurement Agreement. Similar elements were agreed to by the FTAA Procurement Negotiating Group and by the private sector meeting at the Americas Business Forum.

This demonstrates the broad consensus on the elements of transparency, including broad publication of rules, procedures, deadlines, criteria and decisions; notice in ample time; the application of objective, measurable criteria previously defined and disseminated; civil society oversight; professional standards and training; and dissuasive sanctions and penalties for non-compliance by both public officials and private sector bidders.

Efforts to increase the transparency and integrity of public procurement should not be limited to regulating the behavior of governments. An obligation to have corporate anti-bribery codes of conduct and compliance programs would promote private sector compliance with legal requirements and the highest ethical standards.

An "Integrity Pact" that commits all bidders to refrain from bribery and that sanctions violations can also be effective tool to support ethical behavior in procurement and its use should be encouraged.

In conclusion, we appreciate the opportunity to present recommendations that we hope will contribute to the realization of the Summit objective of creating prosperity in the hemisphere.


Thank you.

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