AZERBAIJAN SEEKS TO CURB RAMPANT CORRUPTION

Several officials on all levels of government have been fired and hundreds of state employees have been subjected to administrative charges since Azerbaijan’s authorities commenced an anticorruption campaign a month ago. While ministries are competing over which one has punished the largest number of employees for abuse of authority, ordinary people are discussing how far the anticorruption campaign will go.

On January 27, the head of the presidential administration Ramiz Mehdiyev chaired a meeting of the national Commission on Combating Corruption and promised that offenders would be penalized.

Referring to President Ilham Aliyev’s “vision”, Mehdiyev told the heads of governmental agencies attending the meeting that “combating bribe-taking and corruption in the country must not be formal  and must be a priority of governmental bodies”. President Aliyev himself cleaned up among senior officials by firing the chairman of the water supply company, as well as heads of local administrations in the country.

Afterwards, ministries and committees dismissed a number of employees on corruption charges. The Health Ministry’s web site reported that some 21 heads of hospitals, maternity hospitals, and hygienic and epidemiological centers had been sacked, while an additional 54 senior officials had been subjected to disciplinary punishments and warnings for shortcomings in organizing public medical services. The Justice Ministry fired the head of the Penitentiary Service responsible for order in jails, while six judges lost their seats.

Four deans and heads of departments have been dismissed from Azerbaijan's top university. Dozens of directors of kindergartens throughout the country were dismissed for “failings in their work”, according to the Ministry of Education. Criminal charges have been brought against six Transport Ministry employees for abusing authority, and nine road police employees were sacked.

According to international reports, corruption is rampant in Azerbaijan. In 2010, the global anticorruption watchdog Transparency International ranked Azerbaijan as 134 of 178 countries on its Corruption Perceptions Index, behind Armenia at 123 and Georgia at 68. The 2010 Global Corruption Barometer examined bribery involved in people’s contact with customs, education, the judiciary, land related services, medical services, the police, registry and permit services, tax authorities, and utilities. It found that 47 percent of Azerbaijani respondents paid a bribe to any of the nine service providers. According to the survey, over 50 percent of the respondents thought that corruption had increased in 2010 and that the most corrupt sector was the police, followed by the educational institutions and the judiciary.

Experts believe that bribery is not only a legal issue in Azerbaijan, but also a social problem. The general public does not perceive corruption to be as widespread as the experts assess due to a tradition of gifting (thanking) someone in exchange for a service. This tradition is considered literally as a sign of respect (“hörmet” in the Azerbaijani language).

The U.S. State Department stated in its 2010 Investment Climate Statement regarding Azerbaijan that “…The poor quality, reliability, and transparency of governance, as well as regulatory abuse and poor contract enforcement, significantly impede the ability of many companies to do business. Politically connected business interests benefit from their control of lucrative sectors…”. The same report pointed out that people identified “the State Customs Committee as the institution of greatest concern to businesses in Azerbaijan, followed by the Ministry of Taxation … and corruption appears most pervasive in the regulatory, tax and dispute settlement systems”.

While Azerbaijan’s government conducts its anticorruption campaign, a trial against the Swiss freight company Panalpina has just revealed that the company was allegedly paying bribes to Azerbaijani officials in past years. Radio Liberty reported that according to U.S. investigators, Panalpina’s branch in Azerbaijan has allegedly paid US$ 900,000 in bribes to the country’s customs officials during 2002-2007. The bribes were paid to expedite imports of goods, avoid customs duties on imported goods, and lower tax assessments. The Justice Department’s documents claim that Azerbaijani officials have received bribes to overlook incomplete and inaccurate documentation.

Another company, Tidewater Marine, admitted that it had paid bribes to Azerbaijani tax inspectors in 2001-2005. The New Orleans-based company, which operates offshore service and supply vessels for energy exploration, is charged with paying US$ 160,000 in bribes. Tidewater is said to have saved US$ 820,000 in taxes. However, Azerbaijani officials have been silent on these bribe cases.

International watchdog organizations note that Azerbaijan has made little progress in actually combating corruption, despite the adoption of relevant legislation and national anticorruption measures. Meanwhile, Azerbaijani officials claim that the fight against corruption will be permanent. “The anticorruption measures are not just a campaign, this process will be continued in all spheres”, said Fuad Alasgarov, Chief of the Presidential Administration’s department for work with law-enforcement organizations, on February 28.

Stressing the President’s recent signature of two orders on increasing transparency in the customs and police, Alasgarov said that a “one-stop shop” system would be applied on the customs points. “Those who bring cars to Azerbaijan from abroad will carry out such procedures as registration of the car and its identification number according to the single window principle. All these procedures will be implemented by means of bank cards. An electronic system will also be implemented”. One car importer said that depending on the car’s model, its capacity and age, the unofficial fee varies between US$ 500 and US$ 2,000.

In order to inform the population about tariffs and other official fees, the national anticorruption commission launched the website www.rusum.az in mid-February, presenting information from utilities calculation to custom tariffs and taxes.

However, many respondents speaking off the record are unconvinced about the efficiency of these measures. One importer said that “even after all these statements, we continue paying extra fees to customs officers as before, nothing has changed”.