corruption

South Korea Looks to Hong Kong and Singapore in Fight Against Corruption

Corruption permeates all levels of South Korean society, from local banks and state-owned enterprises to the office of the president. Just the latest in the country’s many scandals revealed that over 95 percent of new hires in state-owned casino resort Kangwon Land had got their jobs because of ties to politicians and other influential figures.

Though South Korea’s private sector is notorious for its corruption, the country’s public sector also has a serious problem. South Korea was ranked 51st in Berlin-based Transparency International’s 2017 Corruption Perceptions Index, which ranks countries based on perceived public sector corruption. Fellow ‘Asian Tigers’ Singapore and Hong Kong ranked 6th and 13th respectively, making them the two top performers in the region.

Meanwhile, the World Economic Forum’s Global Competitiveness Report 2017–2018 ranked South Korea 45th out of 137 countries in terms of irregular payments and bribes and 81st when it came to favoritism in decisions of government officials.

South Korea has adopted multiple anti-corruption initiatives over the years, raising the question of how these have failed to stem the ongoing torrent of sleaze. How does the country differ from Hong Kong and Singapore when it comes to tackling corruption?

Corruption in Asia is nothing new. Singapore and Hong Kong also struggled with endemic sleaze from the 1950s to the 1970s, prompting them to establish powerful anti-corruption bodies such as Singapore’s Corrupt Practices Investigation Bureau (CPIB) and Hong Kong’s Independent Commission Against Corruption (ICAC). Both are high-profile independent government agencies, responsible for investigating and preventing corruption in both the private and public sectors.

But South Korea hasn’t simply been sitting on its hands. Local efforts have included setting up the Anti-Corruption and Civil Rights Commission in 2008, while anti-corruption bodies have existed since as early as 2002, when Korea Independent Commission Against Corruption (KICAC) modeled after Hong Kong’s ICAC, was launched.

South Korea’s parliament, too, has passed multiple anti-corruption laws over the decades, the most recent example being the 2016 Improper Solicitation and Graft Act dubbed the “Kim Young-ran Act”, famous for its strict “30, 50 and 100,” rules about gift giving and meal buying.

With all these measures in place, why do corruption scandals keep cropping up every year?

“The special characteristic of corruption in South Korea is that it takes the form of elite cartels,” said Park Sang-in, Professor of Public Administration at Seoul National University (SNU).

“Unlike in other countries plagued by corruption, there is no graft among low-level bureaucrats. The majority of corruption scandals in South Korea occur because of cozy relationships between the government and businesses, with elites forming their own cartels and engaging discreetly in corrupt activities. It’s hard to get rid of it [corruption] unless the country’s elite is replaced.”

South Korea’s 2017 mega-scandal, in which then-president Park Geun-hye was impeached for taking bribes and illicit funding from conglomerates and the country’s spy agency, was just the biggest iteration of a recurring pattern. Former president Lee Myung-bak was arrested earlier this month facing multiple charges including bribery, abuse of power, embezzlement and tax evasion.

The Supreme Prosecutors’ Office has been repeatedly embroiled in corruption scandals for years. Prosecutors have frequently been given cushy jobs in state-owned enterprises and received bribes and even sexual services from business figures, tarnishing their reputation and eroding public confidence.

Although Park Sang-in attributes South Korean corruption to an elite cartel, bureaucratic elites also exist in Hong Kong and Singapore. Fewer than two out of ten Hong Kong high school graduates matriculate to a handful of public universities, which function as breeding grounds for the territory’s future elite bureaucrats.

Singapore is known for grooming its future bureaucrats from a young age by sponsoring expensive overseas study for selected graduates known as “scholars,” on the condition that they work for the Singapore government or a government-linked company (GLC) after graduation.

So how did Hong Kong and Singapore, with elites of their own, succeed in staying so much cleaner than South Korea?

Singapore turned to money. The Lion City’s bureaucrats receive fat paychecks as part of a pay system created by founding father Lee Kuan Yew to attract talent and prevent corruption. But high pay is accompanied by heavy responsibility: Punishment for corrupt officials in the city-state is especially severe. In 2014, a CPIB employee caught misappropriating $1.76 million was sentenced to 10 years in jail. By contrast, South Korean prosecutor Jin Kyung-joon was sentenced to just four years in 2016 after receiving bribes amounting to $841,000 from leading online game developer Nexon.

Granting powerful investigative rights to anti-corruption entities has also helped root out corruption. Hong Kong law, for example, allows the ICAC for to perform covert surveillance investigations under certain circumstances.

South Korea wants its own version of the ICAC and CPIB. Lawmakers proposing an anti-graft body in 2016 stated, “The majority of citizens and civil society feel the need to establish an investigative body independent from the Supreme Prosecutors’ Office (SPO) and political power. Hong Kong’s ICAC and Singapore’s CPIB, established with such a purpose, have been successful in tackling corruption among high-ranking bureaucrats.”

Current president Moon Jae-in endorsed the bill during his 2017 election campaign, committing himself to establishing an anti-graft body. “If the bill passes, I, as the president, and those around me will be investigated first,” he said in November 2017.  

According to the National Assembly’s proposed bill, head of the anti-graft body will be recommended by a special committee who will be subsequently approved by parliament and appointed by the president. The body will be lean compared to the ICAC and the CPIB, comprising no more than 20 special prosecutors. The ICAC employes some 1,000 people and the CPIB about one-tenth of that number.

If established, the anti-graft body proposed by the National Assembly will be granted the rights to both investigate and prosecute — the latter is currently the exclusive preserve of the SPO. In fact, not even the ICAC or the CPIB possesses prosecution rights, making the South Korean proposal radical by regional standards.

Liberty Party Korea, the country’s main opposition party, is not fond of the proposed anti-graft body. In 2017, Hong Joon-pyo, LPK leader and a former prosecutor, wrote a Facebook post saying “a poodle is enough — why release a ferocious dog?”

But Moon has described the power of the SPO as “massive but not adequately controlled,” leading to politically-driven decisions such as obstructing probes into the National Intelligence Service’s alleged interference in the 2012 presidential election.

“The SPO has been abusing its power to reap benefits from those in power and maintain its institutional vested interests,” said Moon.

According to professor Choi Jin-wook of Korea University, past initiatives to tackle corruption were ineffective because of a “lack of political will by ex-presidents and parliament to tackle corruption during the Park Geun-hye and Lee Myung-bak administrations.”

While many South Koreans see Hong Kong and Singapore as role models when it comes to rooting out corruption, others say this is like comparing an apple to an orange. Singapore is able to keep its country clean because of its small size, both in geographical and economic terms, according to Park of SNU. “Singapore, including its politics, works like a corporation,” he said.  

In fact, Singapore Inc has recently been facing various corruption scandals of its own — some of which bear uncanny similarity to those of South Korea. Last year, Prime Minister Lee Hsien Loong became embroiled in a public feud with his younger brother over a house left behind by their late father, Lee Kuan Yew, with the PM accused of abuse of power.

corruption Singapore
Singapore’s Prime Minister Lee Hsien Loong (Source: Wikimedia)

The same year, Singapore was rocked by its biggest ever corporate corruption scandal when it was revealed that Keppel O&M, part of a corporation in which state-owned investment company Temasek is the biggest shareholder, had been paying bribes to Brazilian officials since 2001 in order to win contracts. Temasek CEO Ho Ching is the wife of Lee Hsien Loong.

CPIB, the city-state’s anti-corruption body, operates under the Prime Minister’s Office and “with functional independence,” according to its website.

Back in South Korea, a firm plan for the new anti-graft body has yet to be finalized. If a plan does materializes, according to Park of SNU, the most important thing is that it be independent from political influence — though, as the Keppel case shows, this can be hard to achieve.

 

Cover photo: Former South Korean president Lee Myung-bak. (Source: Wikimedia)

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Juwon is a journalist at Korea Exposé covering all things business. She’s previously worked as a TV producer in Channel News Asia in Singapore and has interned for Bloomberg, AP and Google. Juwon is a proud owner of her dog Noah and a graduate of Journalism and Media Studies Centre at the University of Hong Kong.