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OECD Integrity Scan of Kazakhstan OECD Public Governance Reviews PREVENTING CORRUPTION for a COMPETITIVE ECONOMY OECD Public Governance Reviews OECD Public Governance Reviews OECD Integrity Scan of Kazakhstan OECD Public Governance Reviews PREVENTING CORRUPTION FOR A COMPETITIVE ECONOMY This series includes international studies and country-specifi c reviews of government efforts to make the public sector more effi cient, effective, innovative and responsive to citizens’ needs and expectations. Publications in OECD Integrity Scan this series look at topics such as open government, preventing corruption and promoting integrity in the public service, risk management, illicit trade, audit institutions, and civil service reform. Country-specifi c reviews of Kazakhstan assess a public administration’s ability to achieve government objectives and preparedness to address current and future challenges. In analysing how a country's public administration works, reviews focus on cross- PREVENTING CORRUPTION FOR A COMPETITIVE departmental co-operation, the relationships between levels of government and with citizens and businesses, innovation and quality of public services, and the impact of information technology on the work of government ECONOMY and its interaction with businesses and citizens. This report looks at how to curb corruption and build a more competitive economy in the Republic OECD Integrity Scan of Kazakhstan of Kazakhstan by assessing four crucial factors: governance, prevention, detection, and prosecution and recovery. In its analysis, it draws on good international practices as well as OECD instruments and tools in 15 policy areas: regulatory governance, competition policy, public fi nancial management, development co-operation, public sector integrity, public procurement, tax administration and transparency, export credits, lobbying, whistleblower protection, business sector integrity, criminalising bribery, civil society, and media. The report provides recommendations for improving Kazakhstan’s laws and policies as well as effectively implementing them in each of these areas. PREVENTING CORRUPTION FOR A COMPETITIVE ECONOMY COMPETITIVE A FOR CORRUPTION PREVENTING Consult this publication on line at http://dx.doi.org/10.1787/9789264272880-en. This work is published on the OECD iLibrary, which gathers all OECD books, periodicals and statistical databases. Visit www.oecd-ilibrary.org for more information. ISBN 978-92-64-27287-3 42 2017 18 1 P WINNER 9HSTCQE*chcihd+ OECD Public Governance Reviews OECD Integrity Scan of Kazakhstan PREVENTING CORRUPTION FOR A COMPETITIVE ECONOMY This document was approved by the Public Governance Committee on 23 February 2017 and prepared for publication by the OECD Secretariat. This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Please cite this publication as: OECD (2017), OECD Integrity Scan of Kazakhstan: Preventing Corruption for a Competitive Economy, OECD Public Governance Reviews, OECD Publishing, Paris. http://dx.doi.org/10.1787/9789264272880-en ISBN 978-92-64-27287-3 (print) ISBN 978-92-64-27288-0 (PDF) Series: OECD Public Governance Reviews ISSN 2219-0406 (print) ISSN 2219-0414 (online) The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the terms of international law. Photo credits: Cover © Olya Tropinina / Shutterstock.com. Corrigenda to OECD publications may be found on line at: www.oecd.org/about/publishing/corrigenda.htm. © OECD 2017 You can copy, download or print OECD content for your own use, and you can include excerpts from OECD publications, databases and multimedia products in your own documents, presentations, blogs, websites and teaching materials, provided that suitable acknowledgement of OECD as source and copyright owner is given. All requests for public or commercial use and translation rights should be submitted to [email protected]. Requests for permission to photocopy portions of this material for public or commercial use shall be addressed directly to the Copyright Clearance Center (CCC) at [email protected] or the Centre français d’exploitation du droit de copie (CFC) at [email protected]. FOREWORD – 3 Foreword Many of the world’s ills can be traced, at least in part, to corruption. Indeed, corruption is recognised as one of the main barriers to sustainable economic growth, political and institutional stability and social cohesion. It generates added costs to doing business, deterring investment and stifling an economy’s competitive advantage. It weakens the rule of law and threatens security. It diverts resources and public services from those who need them most, undermining their chances of achieving greater well- being and prosperity. It strips ordinary citizens of their voice in democratic processes, cementing or exacerbating social inequalities and ultimately eroding trust in, and the legitimacy of, institutions. Making matters worse, snuffing out corruption has proven to be extremely challenging. It is often systemic and deeply engrained in organisations’ and individuals’ ways of working and thinking. It is both adaptive and agile, finding new avenues and ignoring national and international jurisdictions. It thrives on legal loopholes, or, more blatantly, in the open, by influencing the content of laws themselves. It is no surprise, then, that governments are recognising that real, effective anti-corruption reform requires a coherent and comprehensive approach. Adopting an “all hands on deck” tactic is needed to eliminate corruption and cultivate cultures of integrity both within the public and private sectors, as well as society more broadly. Nevertheless, such approaches are not without their own challenges; they require strong leadership and continual monitoring, effective inter-institutional co-ordination, and adequate resources and capacities. In Kazakhstan, government, firms, civil society and individual citizens alike are all too familiar with these challenges. Corruption is a principal barrier to completing the ongoing economic transition and to ushering in much-needed governance reforms. As such, the government has made tackling corruption one of its main priorities and has embarked on a series of anti-corruption reforms, including restructuring the Anti- Corruption Bureau, revising the Law on Combating Corruption, and introducing new laws to increase transparency and civil society participation in government decision- making. To support these efforts, and under the auspices of the OECD’s CleanGovBiz Initiative, the OECD has undertaken an “integrity scan” of Kazakhstan, based on OECD instruments and tools in 15 specific policy areas. The scan provides examples of international good practices in each area. By focusing on the four key pillars of healthy governance, effective prevention, robust prosecution and recovery, and sharp detection, the integrity scan helps identify both potential gaps and synergies in a country’s integrity systems. An initial diagnostic exercise for future work, these scans focus more on the existing legal and policy frameworks than on the effective implementation or impact of policies. As a transitional economy, addressing corruption will become increasingly important for Kazakhstan to continue to move forward in strengthening its economy and improving wellbeing for citizens. As foreign investment and trade flows continue to increase, it will OECD INTEGRITY SCAN OF KAZAKHSTAN: PREVENTING CORRUPTION FOR A COMPETITIVE ECONOMY © OECD 2017 4– FOREWORD be more important than ever that opportunities for corruption be mitigated. As the middle class grows and citizens demand more of their institutions, ensuring quality public services and building trust in institutions will be essential. Curbing corruption and achieving these goals will be key to the country’s continued path to more inclusive and competitive growth. ACKNOWLEDGEMENTS – 5 Acknowledgements This Integrity Scan was prepared by the Public Sector Integrity Division of the Public Governance and Territorial Development Directorate under the leadership of Janos Bertók and Julio Bacio Terracino. Contributions from across the OECD were coordinated by Natalia Nolan Flecha, Carissa Munro, Yukihiko Hamada and Chad Burbank. Contributions were received from Daniel Trnka of the Regulatory Policy Division in the Public Governance and Territorial Development Directorate, GOV (Chapter 1: Improving regulatory governance in Kazakhstan); Lynn Robertson and Sabine Zigelski of the Competition Division in the Directorate for Financial and Enterprise Affairs, DAF (Chapter 2: Competition policy in Kazakhstan: Promoting efficient and sound markets); Ronnie Downes and Annamaria Tuske of the Budgeting and Public Expenditures Division, GOV (Chapter 3: Open budgeting for integrity and accountability in Kazakhstan); Lena Diesing of the Public Sector Integrity Division, GOV (Chapter 4: Development Co-operation in Kazakhstan); Carissa Munro of the Public Sector Integrity Division, GOV (Chapter 5: Strengthening public sector integrity in Kazakhstan, Chapter 9: Regulating lobbying in Kazakhstan to prevent policy capture, Chapter 11: Empowering civil society in Kazakhstan, Chapter 13: Encouraging reporting of corruption in Kazakhstan through stronger whistleblower protection, and Chapter 14: Supporting an independent, vibrant
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