EU anti-corruption report raises concern in Italy

ROME - The European Union's criticism concerning the record level of corruption in Italy has raised awareness as well as concern for the problem that Italian experts see still far from improvement due to legislative and cultural deficiencies.

The European Commission, EU's executive agency, released its first ever anti-corruption report on Monday which estimated criminal infiltration and misappropriation of funds to account for 40 percent of the total value of the contracts in large-scale infrastructure projects in Italy.

In response, Italian authorities pledged "to work" on corruption that the local audit court found to cost as much as 60 billion euros (81 billion US dollars), or 4 percent of gross domestic product (GDP), per year.

"Brussels was right to chastise countries, including Italy, on corruption and legality," Italian Prime Minister Enrico Letta said on Tuesday. "We will work on it and you will see elements presented over the next few days," he assured.

"Italy has its own faults," Italian President Giorgio Napolitano acknowledged. He underlined, however, that his country "has also made some steps" in fighting corruption.

Local experts especially called for stricter regulations and a cultural change to tackle what, besides being an ethical question, represents a menace for the country's economy.

"Illegality acts as a brake on the economy," Elio Veltri, a writer and former mayor of Pavia renowned for fighting corruption in his political life, told Xinhua.

Among the negative repercussions on the economy, widespread corruption from illegality in the public service sector to organized crime and tax evasion "discourage reliable foreign firms from investing in Italy," Veltri said.

Deputy President of the country's leading industrial association Confindustria, Ivan Lo Bello, agreed that "without corruption, Italy would be in better economic conditions."

"The distorting effect of corruption is often underestimated: it destroys competition and wealth," Lo Bello said.

Also speaking out against corruption on Tuesday, Italy's central bank head Ignazio Visco warned that "illegality in its various forms strongly conditions economic growth."

Corruption prevents the proper allocation of public funds for development and creates distortions within the market, he noted. Just to think that in Italy construction costs for high-speed rail averaged 61 million euros per km compared to high-speed rail links in France or Spain which cost 10 million euros per km.

Italy was also regarded as the worst country among the industrialized economies for tax evasion, estimated by the national tax office at around 130 billion euros every year.

Experts especially insisted that more help should come from national legislation, which they said lacks instruments to fight corruption.

Previous calls for stricter rules in Italy, which ranks 69th out of 177 countries and regions in the Corruption Perceptions Index 2013, finished with the adoption of an anti-corruption law in 2012 that was widely labeled as ineffective.

The law was blamed for missing some important interventions such as measures against money laundering and not making false accounting or trading votes a felony.

"I analyzed this law. It had some good points, like the one regarding prevention on corruption, but also a huge limit: it remained essentially unenforced," Veltri said.

Besides arriving late, the 2012 anti-corruption law was very complex and left unresolved various problems especially regarding the link between politics and organized crime, which the EU report described as a key factor in Italy's levels of corruption, the former mayor noted.

"History has already showed us the destructive impact of corruption," Veltri said. Italy's oldest party, the Italian Socialist Party (PSI), he recalled, had virtually collapsed because of the explosion of major corruption scandals in the 1990s.

"When I was a mayor, I have always made it extremely clear that I was embracing legality. Fighting corruption, though it is not easy, is possible and above all necessary for the future of Italy," he stressed.