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 Business News | August 2005 
Report: Bribery Equals 12% of GDP
 Silvia Otero - El Universal
| | A consulting firm studied the impact that corruption has on the nation's medium- and small-sized companies. |
The total cost of corruption in Mexico is equal to 12 percent of the nation's gross domestic product (GDP), according to a study by the firm CEI Consulting & Research.
The study, titled "Diagnostic on the Impact of Fraud and Corruption on Small- and MediumSized Companies," says firms operating in Mexico spend US43 billion annually by paying bribes.
The consulting firm surveyed 1,376 companies in the manufacturing, construction, retail and service sectors, and compiled the results in its report. The study's goal, according to CEI president Arturo de Castillo, was to measure the impact corruption had on small- and medium-sized businesses that created 315,000 jobs in 2004 and accounted for 42 percent of the nation's GDP.
The figures show the high cost the nation pays due to endemic corruption: The report estimates that 507 bribes are paid daily and 57 percent of Mexicans over the age of 30 have paid a bribe at least once in their lives.
Forty-three percent of the companies polled regularly pay public officials for operating licenses and permits, according to the report. However, the numbers show the problem is more serious at the local level: 57 percent of the time the bribes go to municipal officials, while state and federal officials collect 36 and 18 percent of the nation's bribes respectively. Bribe-paying companies regularly send 10 percent of total profits to paying off these officials.
The report also points to the practice as a factor discouraging investment: "35 percent of foreign companies that decided against investing in Mexico in the last five years did so because of concerns over corruption," the report states. |
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