Creating an African alliance, enforcing our bribery laws

We’ve been talking for years here at the FCPA Blog about the dangers of uneven anti-bribery enforcement among capital-exporting nations. I’ve written about what happens when some capital-exporter enforce a bribery prohibition while some do not; in particular, when the United States enforces and China does not. Not only can it put Chinese companies at a competitive advantage, but it will tend to promote the dominance of Chinese firms, and its government, in some of the more corruption-prone markets, particularly Africa.

That, in turn, will have major economic and foreign policy implications, as the United States struggles to build economic and political alliances on the continent while China gains ascendancy.

And now the Obama Administration has organized a summit with African leaders in which it has very carefully orchestrated the delivery of this very message. As the Wall Street Journal’s Risk and Compliance Report notes, Secretary of State John Kerry, and Trace International president Alexandra Wrage are now speaking to African leaders about this very problem. Here’s hoping that we, too, are listening.

A high-ranking member of the Obama Administration once said to me, off the record, that the President’s goal of increasing trade with Africa is made very difficult by FCPA enforcement. We need not be fatalistic about the problem. But those of us who care both about anti-corruption reforms and about boosting economic development in the world’s poorest regions should continue to work toward resolving this paradox.

Enforcing the FCPA in such a way that it promotes transparency, free markets, economic growth, and democratization, is our present challenge. And I for one think we’re up to it.

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