Theme: Political

Michael Ofori-Mensah, Head of Research at Transparency International Defence and Security, describes some of the dangers documented in our latest research paper.

Unaccountable private military and security companies continue to pursue partnerships that in recent years have led indirectly to the assassination of presidents and journalists, land grabs in conflict zones, and even suspected war crimes.

From Haiti to Saudi Arabia to Nigeria, US-based organisations – the firms that dominate the market – have found themselves associated with a string of tragedies, all while their sector has grown ever-more lucrative.

Transparency International Defence and Security’s latest research – ‘Hidden Costs: US private military and security companies and the risks of corruption and conflict – catalogues the harm playing out internationally as countries increasingly seek to outsource national security concerns to soldiers of fortune.

Hidden costs from the trade in national security

While the US and other governments have left the national security industry to grow and operate without proper regulation, the risks of conflict being exploited for monetary gain are growing all the time.

Hidden Costs documents how the former CEO of one major US private military and security company was convicted – following a guilty plea – of bribing Nigerian officials for a US$6bn land grab in the long-plundered Niger Delta.

Our research also highlights that the Saudi operatives responsible for Jamal Khashoggi’s savage murder received combat training from the US security company Tier One Group.

Arguably most damning are the accounts from Haiti, where the country’s president was killed last year by a squad of mercenaries thought to have been trained in the US and Colombia.

Pressing priority

Many governments around the world argue that critical security capability gaps are being filled quickly and with relatively minimal costs through the growing practise of outsourcing.

Spurred on by the US government’s normalisation of the trade, US firms are growing both their services and the number of fragile countries in which they operate.

The private military and security sector has swelled to be worth US$224 billion. That figure is expected to double by 2030.

The value of US services exported is predicted to grow to more than $80 billion in the near future, but the industry and the challenge faced is global.

The risks of corruption and conflict in the pursuit of profits are plain.

These risks are as old as time. But their modern manifestations in warzones must not be left to spill over. The 20-year war in Afghanistan cultivated dynamics that threaten further damage, more than a decade after governments first expressed their concerns.

Required response

International rules and robust regulation are urgently needed. We need measures that ensure mandatory reporting of private military and security company activities. The Montreux Document lacks teeth, operating as it does as guidance that is not legally binding. Code of conduct standards must also become mandatory for accreditation, rather than purely voluntary.

Most private military and security firms are registered in the US. So Transparency International Defence and Security is also calling on Congress to take a leading role in pushing through meaningful reforms under its jurisdiction. There is an opportunity arriving in September, when draft legislation faces review.

Policymakers have long been aware of the corruption risks and the related threats to peace and prosperity posed by this sector. The time for action is well overdue. No more Hidden Costs.

Work is underway to shape policies necessary for the prevention of further coups in Mali, following two recent military takeovers of the west African nation.

Mali has been operating under what leaders have described as a period of “transitional” military governance since August 2020, with elections repeatedly delayed.

Transparency International is embarking on a new project aimed at establishing policies that would prevent future coups being carried out and see corruption threats mitigated in the nation’s defence and security sector, assessed as “high risk” through our Government Defence Integrity Index.

The initiative supported by the United Nations Democracy Fund aims to empower ordinary Malians and their civil society organisations to “exercise oversight” and engage with government representatives and defence institutions in reforming defence governance.

Legislative foundations will be laid in preparation for the resumption of parliamentary work following a two year hiatus that has seen female representation in positions of political influence shrink to zero.

‘Power to convene’

The project will be delivered through a partnership between Transparency International’s national chapter — CRI 2002 — and TI-UK.

Working together we combine national level civil society legitimacy, contextual understanding and power to convene with global expertise in corruption in the defence sector.

We will partner with local journalists and with a civil society network — the CSO Forum created under the previous UNDEF project — while expanding the project’s reach to all 10 of the country’s regions.

We will present policy recommendations to the National Transition Council (NTC), with whom we are already engaged, to integrate into legislation once the National Assembly resumes.

Three-pronged approach

Our approach is underpinned by three activities:

• In-depth research into the role that corruption can play in facilitating military coups. The paper we produce will identify policy recommendations to anticipate and prevent future coups in Mali. It will also signpost risks to other countries facing similar challenges.
• Analysis of the defence sector’s performance during the COVID-19 emergency. Our briefing will focus on the impact of corruption during emergencies and how it undermines the country’s capacity to respond to disasters. The analysis will include policy recommendations that can inform disaster risk reduction (DRR) interventions.
• An advocacy program for CSOs to facilitate engagement with the National Transition Council and defence institutions. This will encourage integration of policy recommendations into legislation.

Our research shows Freedom of Information regimes in countries across the world are not good enough at protecting the public’s right to know

By Ara Marcen and Najla Dowson-Zeidan

The ‘right to know’ for citizens to learn what public institutions are doing on their behalf is a crucial component of human rights law, and vital to combat corruption by providing transparency and accountability. But as with all rights, there is often a big difference between being entitled to them and being able to realise them. With the right of access to information, nowhere is this gulf more apparent than in the defence and security sector.

Militaries, security institutions and ministries of defence are notoriously opaque. Despite robust international (and some national) anti-corruption and freedom of information legislation that governs public sectors, the defence sector is frequently given a green light to remain secretive and evade accountability by utilising the ‘national security’ exemptions so often contained in this legislation. The result is that secrecy is often the norm and transparency the exception.

This approach to transparency in defence needs to change. The secretive nature of defence, and a lack of transparency and access to information, impairs civilian control of the security sector, hampers oversight bodies and increases corruption risks at all levels. It allows corruption to occur unexposed, unaddressed, and in the shadows.

Transparency should be the norm and secrecy the exception. While some information in the defence sector may need to remain classified for legitimate national security reasons, this should be a well-founded exception – not a rule. Maintaining high levels of secrecy limits scrutiny and allows the vicious circle of secrecy, opportunity for corrupt acts and self-enrichment to flourish.

This International Right to Know Day, we call on all governments and public authorities to limit the opacity around security to only the most sensitive information – where the likelihood of harm as a result of its disclosure clearly outweighs the harm to the public interest in withholding it – so national security is not a pretext for limiting citizens’ right to information. Defence and security sectors should not be treated as exceptional when it comes to the public’s right to know how their money is being spent and how key policy decisions are being made.

Initial findings of our global Government Defence Integrity Index, a vast pool of data that assesses how government defence institutions protect themselves against the risk of corruption, show that in most countries there is a long way to go to make mechanisms for accessing information from the defence sector effective. Of the 86 countries assessed, almost half were assessed as at a high to critical risk of corruption in relation to their access to information regimes, meaning that the legal frameworks for access to information, implementation guidelines, and effectiveness of practice at the institutional level are currently not good enough at upholding citizens’ right to access information.

Weaknesses in legal frameworks regulating access to information in defence expose countries to high levels of corruption risk as they reduce transparency and hamper effective oversight of the sector. However, the implementation of these frameworks in practice presents even more significant risks. Poor implementation of Access to Information regulations in defence makes information extremely difficult to obtain and undermines the effectiveness of legislation.

The GDI data shows a significant implementation gap; even where legal frameworks are in place, most countries score less well in terms of actually putting this into practice The vast majority of countries fall well short of the good practice standard for implementation, whereby ‘the public is able to access information regularly, within a reasonable timeline, and in detail’. Most were assessed as having at least some shortcomings in facilitating access to defence-related information to the public (for example, delays in access or key information missing), and in more than one in three of the countries assessed the public is rarely able to access information from the defence sector, if at all. While corruption in every sector wastes resources and undermines trust between the state and its citizens, corruption in the defence and security sector, among institutions tasked with keeping peace and security, has a particularly detrimental impact. In fragile and conflict states, corruption – both a cause and a consequence of conflict – frequently permeates all areas of public life.

And the costs of this are high – both financially (with annual global military expenditure estimated to be almost $2 trillion^[1]) and in terms of human security. Corruption damages populations’ conception of the legitimacy of central authorities, threatens the social contract, and ultimately the rule of law and attainment of human rights.

The right to information and transparency are key pillars for good governance and accountability and are crucial tools in the fight against corruption. They enable external oversight of government – and the military – by legislators, civil society and the media, increasing accountability of political decision-making and institutional practice. They enable informed participation of the public and civil society in public debates and development of policy and law. And they bring corruption risks – and actual incidents of corruption – to light, facilitating the push for accountability and reform.

Recommendations:

We’re calling on states to renew their commitment to the right to information. They need to ensure that their national legal frameworks include laws that enable the public to exercise the right of access to information across all sectors. Rules for classification and declassification must be rigorous and publicly available, with clearly defined grounds for classifying information, established classification periods. And there should be the possibility of appeal for those who wish to access information withheld in Freedom of Information proceedings.

Defence institutions should have in place rigorous and publicly available rules for withholding information, with clearly defined procedures and grounds for classifying information, established classification periods, and a possibility of appeal for those who wish to access information withheld in Freedom of Information proceedings. They should be accompanied by clear criteria and process for public interest and harm tests that can help balance genuine needs for secrecy with overall public interest. Adopting and endorsing the Global Principles on National Security and the Right to Information (the Tshwane Principles) would be a good step towards having the right access to information regime in place.

To make sure that secrecy does not trump the right to know – and to strengthen the ability of defence institutions to protect themselves against the risk of corruption – governments should consider these key principles:

1. Freedom of information is a right. Any limitations of this should be the exception, not the rule.
2. Transparency is a key tool against corruption. Enabling public scrutiny, rather than undermining a public institution, can lead to better use of resources and reduce risk of corruption.
3. The interest of preventing, investigating, or exposing corruption should be considered as an overriding public interest in public interest and harm tests, as corruption is not only a waste of public resources, but also seriously undermines the national security efforts of a country.

For more on Access to Information in the defence sector, see our factsheet.

[1] https://www.sipri.org/media/press-release/2021/world-military-spending-rises-almost-2-trillion-2020

The assassination of Haiti’s president by a mercenary hit squad demonstrates the destabilizing effects of privatized force. The United States does not have the laws needed to prevent and punish such acts.

By Michael Picard

On 7 July, a team of foreign mercenaries linked to a US security firm assassinated a head of state. Jovenel Moise, Haiti’s president, was murdered in his own home by a well-trained commando unit composed of Colombian and US nationals. His wife, Martine, was critically wounded.

This raises questions. Under what pretext did the US citizens participate in this heinous act? More importantly, what control does the US government have over such actions, and is this enough to prevent similar actions in the future?

Contemporary conversations about mercenaries focus on private military security companies and contractors (collectively PMSCs). The United States is home to a uniquely large PMSC industry, bloated by two decades of government contracting in support of the War on Terror, as well as a glut of recent combat veterans with special forces experience.

US PMSCs provide their services both domestically and abroad, from guarding oil pipelines and embassies to training foreign security forces. As the sector expanded and internationalized, so have concerns about the ethics, legality, and impacts of normalizing private force in fragile environments.

US mercenaries have a long history of operating in and destabilizing Latin American countries, which continues to this day. In May 2020, Venezuelan authorities captured and exposed a team of armed dissidents led by two US contractors – former green berets. The contractors worked for a US PMSC seeking to overthrow dictator Nicolas Maduro on behalf of the Venezuelan opposition.

US PMSC activity extends to Haiti. In February 2019, a group of US contractors were arrested in Port-au-Prince with a large cache of weapons and military equipment found in their vehicles. After the US Government intervened, the contractors were repatriated and set free without charge. The contractors claimed they were hired as a private security detail for Haiti’s wealthy elite in light of heightened civil unrest, while also claiming they were hired by the Haitian government to provide essential security services, demonstrating the blurry line between private and public interest in a country like Haiti. According to Transparency International’s Corruption Perceptions Index, which ranks countries according to local perceptions of state corruption, Haiti ranks in the world’s bottom 10, below Afghanistan.

These two examples demonstrate how a US PMSC could be hired by sectional interests to conduct criminal operations in a highly insecure environment with impunity. On one hand, such a group could be hired to provide – on paper – official services to a foreign government, such as military training, technical assistance, or executive protection. On the other hand, they could be hired under the guise of providing security for private interests, such as an influential oligarch or a foreign company with local interests.

In either case, however, the US Government has little to no oversight. If a foreign government hires a US PMSC to provide essential defense services – such as military training, intelligence gathering, equipment maintenance, etc – the PMSC would require an arms export license from the US State Department. As stipulated in the International Traffic in Arms Regulations (ITAR), the PMSC would present a contract-like document to the US State Department’s arms control body, which would then review it in coordination with the US Defense Department, before approving it.

As a rule, the State Department forbids the authorization of combat services under ITAR. While ITAR gives the government some oversight of PMSC activities, it is highly limited owing to the intangible nature of many defense services. Once in country, there is little to prevent the PMSC from carrying out unauthorized actions, especially when supported by the hosting state.

This was precisely the case with a US PMSC hired by the UAE to carry out assassinations in Yemen in 2015 and 2016. The team carrying out the killings reportedly received an ITAR license to provide the UAE with defense services, likely military training. Yet the US Government has few means to verify that the authorized services are carried out without diversion or misappropriation. Traditional post-delivery verification checks used for tangible defense items are arguably inapplicable to the knowledge- and skill-based services provided by professional soldiers.

Beyond ITAR, there is essentially no other avenue in which the US Government can monitor and control the overseas activities of a US PMSC (unless hired by the US Government). The ITAR definition for defense services intentionally excludes security services – whether for a government, a private company, or a wealthy individual – as its inclusion would overwhelm the thinly-resourced office responsible for licensing arms exports.

Furthermore, punishing the illicit actions of US PMSCs is also difficult. While mercenarism is illegal under international humanitarian law, its definition of mercenary is weak to the point of being redundant. US PMSCs operating overseas are typically held accountable to local law unless they are supporting a US military operation or diplomatic mission governed by a status of forces agreement. This poses a challenge in countries where there is little to no rule of law. Haiti’s justice system is debilitatingly corrupt, and likely lacks the capacity to impartially investigate and prosecute cases relating to political violence involving national elites.

Haiti has long suffered from the exploitative influence of foreign private interests as well as a government that is highly susceptible to corruption. This assassination shows that, in such an environment, it only takes a handful of mercenaries to potentially bring down the state. Without a substantive set of regulations governing the overseas activities of US PMSCs, there is little to prevent their diversion and misuse for subversive, destabilizing actions.

This puts countries like Haiti at risk – and in turn, the United States. It is apparent that any discrete actor can hire US PMSCs to assassinate influential individuals – perhaps even a head of state – and sow chaos in fragile, conflict-ridden countries. When that country borders the United States, it is apparent that US national security is at stake.

Michael Picard is a research fellow for Transparency International Defence & Security (TI-DS). Much of the research presented in this blog is the topic of a forthcoming report by TI-DS on PMSCs and corruption in fragile states.

May 6, 2021 – Close links between the defence industry and governments in Europe are jeopardising the integrity and accountability of national security decisions, according to a new report by Transparency International – Defence and Security.

Defence Industry Influence on Policy Agendas: Findings from Germany and Italy explores how defence companies can influence policy through political donations, privileged meetings with officials, funding of policy-focused think tanks and the ‘revolving door’ between the public and private sector.

These ‘pathways’ can be utilised by any business sector, but when combined with the huge financial resources of the arms industry and the veil of secrecy under which much of the sector operates, they can pose a significant challenge to the integrity and accountability of decision-making processes – with potentially far-reaching consequences.

This new study calls on governments to better understand the weaknesses in their systems that can expose them to undue influence from the defence industry, and to address them through stronger regulations, more effective oversight and increased transparency.

Natalie Hogg, Director of Transparency International – Defence and Security, said:

“When individuals, groups or corporations wield disproportionate or unaccountable influence, decisions around strategy and expenditure can be made to benefit private interests rather than the public good. In defence, this can lead to ill-equipped armed forces, the circumvention of arms export controls, and contracts that line the pockets of defence companies at the public’s expense.

“The defence and security sectors are a breeding ground for hidden and informal influence. Huge budgets and close political ties, combined with high levels of secrecy typical of issues deemed to be of national security, means these sectors are particularly vulnerable. Despite the serious risk factors, government oversight systems and regulations tend to be woefully inadequate, allowing undue influence to flourish, with a lot to gain for those with commercial interests.”

Transparency International – Defence and Security calls on states to implement solutions to ensure that their defence institutions are working for the people and not for private gain.

Measures such as establishing mandatory registers of lobbyists, introducing a legislative footprint to facilitate monitoring of policy decisions, strengthening conflict of interest regulations and their enforcement, and ensuring a level of transparency that allows for effective oversight, will be important steps towards curbing the undue influence of industry over financial and policy decisions which impact on the security of the population.

Notes to editors:

Defence Industry Influence on Policy Agendas: Findings from Germany and Italy is based on two previous reports which take an in-depth look at country case studies. The two countries present different concerns:

• In Italy, the government lacks a comprehensive and regularly updated defence strategy, and thus tends to work in an ad hoc fashion rather than systematically. A key weakness is a lack of long-term financial planning for defence programmes and by extension, oversight of the processes of budgeting and procurement.
• In Germany, despite robust systems of defence strategy formation and procurement, significant gaps in capabilities have led to an overreliance on external technical experts, opening the door to private sector influence over key strategic decisions.

The German report can be found here and the Italian report here.

The information, analysis and recommendations presented in the case studies were based on extensive document review and more than 50, mainly anonymous, interviews.

Contact:

Harvey Gavin

harvey.gavin@transparency.org.uk

+44 (0)20 3096 7695

+44 (0)79 6456 0340 (out of hours)

The risks and impacts of inappropriate influence in the policy-making process, in which individuals or organisations try to persuade in favour of, or force their own agenda, are particularly significant in the defence and security sector. In this context, high levels of secrecy and complexity, combined with close relations between government, private experts, and the defence industry, converge to create a potentially fertile ground for private interests to thrive. Yet when individuals, groups or corporations wield disproportionate or unaccountable influence, this undermines the public good and public funds may be squandered.

This situation is further complicated by the different roles a government plays with respect to its defence industry, being simultaneously both the main customer and the main regulator. Because the government is reliant on the national defence industry for the fulfilment of one of its core obligations – providing defence and security for its citizens – it is easy to see how lines in the relationship between the two roles can easily become blurred. If unchecked, the influence of the defence industry can damage the integrity of state institutions and distort the aims of a national security strategy, while undermining market competition and good defence sector governance.

This paper presents the main findings from two case studies on the influence of the defence industry on the defence and security policy agendas of Germany and Italy. The aim of the studies was to identify pathways of potential undue influence and to make proposals for a more ethical relationship between the defence industry and policy-making entities. This paper provides a summary of the main findings from each study and presents a preliminary framework for understanding the factors that drive the exploitation of these pathways of influence.

This report examines systemic vulnerabilities and influence pathways through which the Italian defence industry may exert undue influence on the national defence and security agenda.

Compiled by Transparency International Defence and Security with the support of the Italian Coalition for Civil Liberties and Rights (CILD) and Osservatorio Mil€x, this report forms a case study as part of a project to analyse the influence of the arms industry on the defence and security agendas of European countries.

Expenses for armaments in Italy continue to increase with a projection of more than 6 billion euro for 2021, presenting a lucrative source of funding for the domestic defence industry. As such, there is an urgent need to identify and scrutinise the possible routes for undue influence in the Italian defence sector.

The report explores some of the most prominent opportunities for exerting influence on policy in Italy – through lobbying, political foundations, think tanks, the ‘revolving door’ and political financing – along with the vulnerabilities in the defence strategy formation and procurement process that expose the Italian system to undue influence.

A summary paper is also available in Italian.

Questo rapporto esamina le vulnerabilità sistemiche e i possibili percorsi attraverso i quali l’industria italiana della difesa può esercitare un’influenza indebita sull’agenda politica nazionale in materia di difesa e sicurezza. I governi e l’industria dovrebbero mitigare il rischio di influenza indebita, rafforzando l’integrità delle istituzioni e dei processi politici e migliorando il controllo e la trasparenza dell’influenza nel settoredella difesa. Redatto da Transparency International – Difesa e Sicurezza con il supporto della Coalizione Italiana per le Libertà e i Diritti Civili (CILD) e dell’Osservatorio Mil€x, questo rapporto costituisce un case study nell’ambito di un progetto di analisi dell’influenza dell’industria degli armamenti sui programmi di difesa e sicurezza dei paesi europei.

La corruption dans le secteur de la sécurité a un impact néfaste à la fois sur le secteur de la sécurité lui-même et sur la paix et la sécurité au sens plus large, en alimentant conflits et instabilité. Des études quantitatives ont mis en évidence la correlation entre corruption et instabilité étatique. Les états dominés par des systèmes fondés sur le clientélisme sont plus susceptibles de souffrir d’instabilité. Il est peu surprenant que 6 des 10 pays ayant obtenu le score le plus bas dans l’Indice de perception de la corruption 2019 se trouvent également parmi les 10 pays les moins pacifiques dans l’Indice mondial de la paix 2020. La corruption nuit à l’efficacité des forces de sécurité et porte atteinte à la perception qu’ont les populations de la légitimité des autorités centrales.

En retour, cela alimente un sentiment de désillusion, menaçant ainsi le contrat social et, en fin de compte, l’état de droit. Dans certaines situations, la corruption peut également faciliter l’expansion des groupes extrémistes et non-étatiques et est devenue l’un des piliers des discours de recrutement. En dénonçant la corruption de l’Etat, ces mêmes groupes se présentent comme une alternative légitime aux gouvernements et aux élites corrompus.

Associée à des éléments tels que la pauvreté, les violations des droits de l’homme, la marginalisation ethnique et la proliferation des armes de petit calibre, la corruption du secteur de la sécurité a eu un effet alarmant sur la sécurité humaine en Afrique de l’Ouest. Au cours des trois dernières décennies, la corruption a appuyé certains des pires épisodes de violence dont la region a été témoin. Des guerres civiles au Liberia et en Sierra Leone au conflit actuel au Nigeria, où la corruption endémique a affaibli les forces de défense et de sécurité, alimenté la rancoeur à l’encontre des représentants des États et permis aux acteurs armés non-étatiques de combler le vide, la corruption a été un dénominateur commun de la plupart des conflits dans la région.

This report examines the quality and effectiveness of defence governance across fifteen countries in Central and Eastern Europe: Albania, Armenia, Azerbaijan, Bosnia & Herzegovina, Estonia, Georgia, Hungary, Kosovo, Latvia, Lithuania, Montenegro, North Macedonia, Poland, Serbia and Ukraine. It analyses vulnerabilities to corruption risk and the strength of institutional safeguards against corruption across national defence sectors, drawing on data collected as part of Transparency International Defence & Security’s (TI-DS) Government Defence Integrity Index (GDI).

It is intended to provide governments and policymakers with an analysis of defence governance standards in the region and supply civil society with an evidence base that will facilitate their engagement with defence establishments and support advocacy for reforms that will enhance the transparency, effectiveness and accountability of these institutions.

This report details good practice guidelines and policy implications that are designed to reduce the opportunities for corruption and improve the quality of defence governance in Central and Eastern Europe. It identifies five key issues of defence governance where improvements are urgently needed in order to mitigate corruption risks: parliamentary oversight, defence procurement, transparency and access to information, whistleblowing, and military operations.

By Benedicte Aboul-Nasr, Project Officer, Transparency International – Defence & Security

On October 17, 2019, Lebanese citizens took to the streets in response to a government proposal to tax WhatsApp communications, in what would become known as the “Thawra”, or “Uprising” against widespread corruption and worsening economic conditions. A year after the beginning of the protests, and two months after the explosion in the Port of Beirut killed 191 people, injured over 6,500, and uprooted nearly 300,000, Lebanese citizens still have no clear answers as to why for six years, 2,700 tons of explosive chemicals were stored in hazardous conditions at the heart of Lebanon’s capital. Many suspect that a long history of negligence and corruption, the very factors that pushed people to the streets last year, are at least partly responsible for the devastation that took place on August 4, 2020.

The government response has been uneven and in the aftermath of the explosion authorities were slow to support immediate relief efforts. Instead, when Lebanese protesters took to the streets on August 8 to voice their anger towards a political class that many believe has benefited from Lebanese resources for decades, security forces responded harshly, deploying tear gas and live ammunition against protesters. Two days later, Hassan Diab’s government resigned, noting that corruption in Lebanon is “bigger than the state”. And, on August 13, eight days after the explosion, Parliament voted for a state of emergency, giving defence forces a broader mandate than the one they already had under the general mobilisation adopted to help contain COVID-19. Since then, Prime Minister-designate Mustapha Adib stepped down, within a month of his nomination, having failed to achieve the consensus necessary to form a government. At the time of writing, Lebanon remains in a political impasse, while former Prime Minister Hariri, who had stepped down two weeks into the protests in October 2019, is in the running to replace his successor.

Allegations of government corruption are not isolated incidents, and mismanagement has led to numerous crises and leadership vacuums over the years, which paved the way for the protest movement. Lebanon is now facing one of the most serious financial crises in its history which has crippled the economy. The state has defaulted on debt payments and banks are imposing de facto capital controls on withdrawals while Carnegie’s Middle East Center estimates that close to US$800 million were transferred out of the country within the first three weeks of the protests. The Lira lost 80% of its value over nine months; by July this year and Lebanon became the first country in the region to enter hyperinflation.  Even before the COVID-19 crisis hit, the World Bank had estimated that up to 45% of Lebanese citizens would be below the poverty line by the end of 2020. Despite undeniable evidence that the situation was untenable, prior to the explosion, discussions with the IMF had been stalled for months, and Alain Bifani, the finance ministry’s director-general, had resigned over state officials’ unwillingness to acknowledge the scale of the crisis and achieve consensus to identify solutions. The contract for a forensic audit of the Central Bank was only signed in August, and the audit itself did not begin until September.

The international community has offered loans and significant humanitarian aid to support victims and the reconstruction of Beirut. Tellingly, several governments have pledged that they would not disburse aid through the government, and are prioritising non-governmental organisations that have been at the forefront of assessment and reconstruction needs. Aid disbursed through the government, and renewed commitments to unlock funds promised by the CEDRE conference in 2018, are conditional on stringent anti-corruption reforms being adopted and must be accompanied by strict oversight. In this regard, it is crucial that Lebanese civil society and non-profit organisations are granted access to sufficient information to oversee the disbursement of aid and prevent funds from being lost.

As part of the broader powers and responsibilities granted to the Lebanese Armed Forces (LAF) under the state of emergency proclaimed after the explosion, the military has been given the crucial role of coordinating the distribution of humanitarian aid and supporting other public bodies in their reconstruction efforts. In carrying out these roles, and with the additional powers from which they benefit, it is crucial that the LAF ensure the highest standards of integrity and transparency with the Lebanese public. The LAF has benefitted from a high level of trust in the past, and remains one of the most representative branches of government – the institution must ensure that it maintains trust and supports ways forward for the Lebanese, in particular as Lebanese citizens and organisations rebuild.

The coming months will be crucial for Beirut’s reconstruction and to help lift Lebanon out of the crisis it is experiencing. Anti-corruption measures and transparency, not only in the disbursement of aid but also in reform efforts, should be prioritised by the armed forces themselves, and more broadly by an incoming government committed to resolve the financial and political crises Lebanon currently faces as the country seeks international support. The Lebanese Transparency Association (LTA), Transparency International’s national chapter in Lebanon, has been advocating alongside Transparency International – Defence & Security for increased transparency and accountability of the defence sector since 2018. In 2020, LTA continued to emphasise the urgent need for further transparency with constituents, and for the armed forces to implement access to information legislation to allow Lebanese citizens to understand how the body functions. As the LAF maintain responsibility in the aftermath of the explosion, both for aid disbursement and for maintaining security alongside security forces, clear communications and oversight of the defence sector are critical.

The explosion and its aftermath have brought issues that Lebanese citizens were familiar with – and which pushed many to the streets over the last year – to the forefront of Lebanon’s dealings with the international community. Only by tackling the root causes, continuing to push for reform, and beginning to rebuild institutions in which the public can trust, will Lebanon have a chance to become more stable and pave a way out of the crisis. Lebanese politicians have often shown willingness to commit to reforms when dealing with the international community in the past. However; reforms have then stalled due to a lack of consensus, for instance leading to delays in implementing access to information legislation, or in selecting members for the National Anti-Corruption Commission. As the international community aims to support Lebanese citizens and help rebuild Beirut, they should be wary of attempts to divert assistance, and of mismanagement in the disbursement of funds. Instead, any international and national initiatives should support Lebanese citizens’ calls to dismantle the root causes of corruption, for the political class to seriously address the financial crisis, and for concrete and measurable steps for reform and accountability.

Benedicte Aboul-Nasr is Transparency International – Defence & Security’s Project Officer working on Conflict and Insecurity, with a focus on the MENA region. She has a background in international humanitarian law and the protection of civilians, and currently researches links between corruption and situations of crisis and conflict.

New report warns weak regulations leave door open to undue influence

October 21 – German defence policy risks being influenced by corporate interests, new research by Transparency International – Defence & Security warns.

Released today, Defence Industry Influence in Germany: Analysing Defence Industry Influence on the German Policy Agenda details how defence companies can use their access to policymakers – secured through practices such as secretive lobbying and engagements of former public officials – to exert considerable influence over security and defence decision making.

The report finds that gaps in regulations and under-enforcement of existing rules combined with an over-reliance by the German government on defence industry expertise allows this influence to remain out of the reach of effective public scrutiny. This provides industry actors with the opportunity to align public defence policy with their own private interests.

To address these shortcomings, new controls, oversight mechanisms need to be put in place and sanctions should be applied to regulate third party influence in favour of the common good and national security.

Natalie Hogg, Director of Transparency International – Defence & Security, said:

“Decisions and policy making related to defence and security are at particularly high risk of undue influence by corporate and private interests due to the high financial stakes, topic complexity and close relations between public officials and defence companies. Failing to strengthen safeguards and sanction those who flout the rules raises the risk that defence decision making and public funds are hijacked in favour of private interests.”

The report shows how lax rules around policymakers declaring conflicts of interest, and lack of adequate penalties for failing to disclose them, leaves the door open to MPs wishing to take up lucrative side-jobs. Frequent and prominent cases of job switches between the public and private defence sector compound issues of conflicts of interest and close personal relationships with inadequate oversight.

And, due to a lack of internal capacity, Germany’s defence institutions are increasingly outsourcing key competencies to industry, allowing defence companies crucial access to defence policy. The procurement of these external advisory services is not subject to appropriate oversight.

While the German constitution requires a strict control over excessive corporate influence in public sectors, too often this is not sufficiently exercised due to a lack of technical and human resources within government and parliament. In addition, insufficiently enforced legal regulations and a lack of transparency of lobbying activities enables undue influence to occur in the shadows outside of public scrutiny.

Greater transparency is necessary to ensure accountability

National security exemptions are common in the defence sector and enable institutions to override transparency obligations in favour of secrecy. However, protecting national security and ensuring the public’s right to information can both be achieved by striking the right balance where information is only classified based on a clear justification for secrecy. Transparency in defence is crucial to ensuring effective scrutiny in identifying and controlling undue influence.

“Despite the justification for secrecy in this policy area the greatest possible transparency must be created to ensure control by parliament and the public. If, in addition, human resources and expertise are lacking, advice from corporate lobbyists receive easy access,” said Peter Conze, security and defence expert at Transparency International Germany.

New lobbying register does not go far enough: we need a legislative footprint

The lack of transparency around lobbying in Germany allows industry actors to exert exceptional influence over public policy.

While Germany’s proposed new lobbying register provides a positive step towards transparency, it does not go far enough to allow effective scrutiny. External influence on legislative processes and important procurement decisions remains unaccountable without the publication of a legislative or decision-making footprint, which details the time, person and subject of a legislator’s contact with a stakeholder and documents external inputs into draft legislation or key procurement decisions.

Transparency International – Defence & Security is calling on the German government to:

1. Expand the remit of the proposed lobbying register to cover the federal ministries and industry actors.
2. Include requirements for a ‘legislative footprint’ that covers procurement decisions in addition to laws. The legislative footprint should outline the inputs and advice that have contributed to the drafting of laws or key policies, and substantially increase transparency in public sector lobbying.
3. Introduce an effective and well-resourced permanent outsourcing review board within the Ministry of Defence to verify the necessity of external services and their appropriate oversight.
4. Strengthen the defence expertise and capacity within the independent scientific service of the Bundestag, or to create a dedicated parliamentary body responsible for providing MPs with expertise and analysis on defence issues.

Notes to editors:

• The report “Analysis of the influence of the arms industry on politics in Germany” was prepared by Transparency International – Defence & Security with the support of Transparency International Germany.
• The report examined structures, processes and legal regulations designed to ensure transparency and control based on 30 expert interviews. The report is part of a comprehensive study of the influence of the defence industry on politics in several European countries.

Contact:

Harvey Gavin

harvey.gavin@transparency.org.uk

+44 (0)20 3096 7695