An official EU report published Monday says corruption affects all member countries of the European Union and costs the bloc at least 120 billion euros ($162 billion) annually. She said the amount lost annually would be enough to fund the Union’s yearly operating budget.
The report was issued by European Commissioner Cecelia Malmstrom during the first official European Union corruption study. Malmstrom said the estimated loss was due to secret political financing, inflated government contracts, bribes and other corrupt practices.
“There are no corruption-free zones in Europe,” Malmstrom told a news conference. “We are not doing enough. And this is true for all member states.”
Although the study does not rank the countries according to the pervasiveness of corruption, Malmstrom said “younger democracies” especially in Eastern Europe face some special challenges.
According to the report, corruption can be found at both the local and regional levels of government and for some member countries it is especially prevalent in the healthcare and real estate sectors.
Malmstrom pointed out that many government contracts get inflated. She said government financed goods and services make up about 20% of the EU spending and that up to 25% of the money spent is lost in corruption dealings.
In one of the surveys, about 4 out of 10 privately owned companies cited corruption as one of the main obstacles to doing business in EU.
“A huge amount of money is lost here,” Malmstrom said.
European Commissioner continued to say the taxpayer’s money is not used properly and citizens don’t get a good return for their money. She also said that corruption “erodes democratic legitimacy.”
The Director of the European Union office of Transparency International Carl Dolan welcomed the reports, saying it came at the right time when voters will be electing a new EU parliament. “What the report shows is that there has been a consistent failure among politicians to regulate their conflicts of interests, particularly in their dealings with business and industry,” Dolan said.
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