Bribery is a must for business success in Mexico: Study

Photo: Luis Pérez de Acha

Business owners pay bribes in order to be successful, says the author of a corruption study, which is why nearly half of Mexican businesses have paid one.

The second edition of the study Mexico: Anatomy of Corruption, released this week, revealed that 43% of established businesses have paid bribes for reasons that range from speeding up official procedures to keeping police from bothering them.

Business people pay bribes with one goal in mind: to make sure their businesses thrive, said María Amparo Casar, author of the study, which was presented yesterday morning by the non-governmental organization Mexicans Against Corruption and Impunity (MCCI).

The study found that 43% of business owners paid bribes to avoid an excessive number of administrative procedures and speed up the process, while 32% paid bribes to obtain permits and licenses and 21% to prevent or impede abuse of authority.

Sixteen per cent used bribery for networking — to gain access to contacts and influential people — and 11% to participate in a government bidding process.

“We see therefore that entrepreneurs face high costs if they are to enter the market. This explains why Mexico is falling behind in the creation of new businesses when compared to other Latin American countries,” said Casar.

According to the poll Fraud and Corruption in Mexico, quoted by Casar in her report, 47% of business owners said that if they didn’t pay bribes official procedures were slower, while 27% said they were given unjustified fines, 21% lost contracts and 7% were left feeling more insecure.

The report warns that “we must not consider business as mere victims of corruption, but also as beneficiaries.”

Corruption occurs not only due to the fear of the consequences of not paying a bribe, but for greed and lack of ethics in obtaining what the law otherwise prohibits.

The study used as an example companies that have no right to a concession but obtain it anyway after paying a bribe. There is also the case of those who don’t meet the requirements to bid for a contract but are spared, or those that don’t offer the best deal but get rid of rivals through legal chicanery.

Photo: Luis Pérez de Acha
Photo: Luis Pérez de Acha

Thus — according to the Global Fraud Survey, also quoted by Casar’s report — 82% of polled executives in Mexico agreed that acts of corruption were carried out extensively when doing business in the country, while 70% said they would agree to incurring an “illegal act” as long as their financial goals were being met.

Casar also found that even while public agencies are receiving more funding than ever to combat corruption, an overall increase of 94% since 2004, Mexico remains one of the worst ranked countries with regard to transparency and accountability.

Funding for Inai, the National Institute for Transparency and Access to Information, has increased by 335% during the last 12 years, while the Federal Auditor’s Office’s budget has increased by 245% in the last two years.

Despite the increases, continued the report, Mexico’s international transparency ranking has remained constant during the last 20 years at 35 out of 100 possible points. The closer a ranking is to 100 points, the less corrupt the country.

In terms of perception of corruption, Mexico ranked 95 among 168 countries in 2015, worse than Suriname, Panama or El Salvador.