Anticorruption policies have low priority in both countries and have lost momentum across the region as a whole
Despite a wave of corruption cases that have dominated headlines, the hard truth is that most Latin American governments have relegated anticorruption measures to second place in recent years while voters have mobilized less around the issue. With a few exceptions – such as in Guatemala last August – anticorruption promises no longer define Latin American elections.
This is particularly true in the two region’s largest countries, Brazil and Mexico, which over the past decade showed sparks of hope through high-profile corruption investigations such as Operation Lava Jato. However, more recently, they have struggled with entrenched corruption and a limited willingness to address related problems. In the last five years, both countries have faced an especially challenging course in fighting corruption according to the Corruption Perception Index (CPI), published by Transparency International, which evaluates and ranks 180 countries and territories by their perceived levels of public sector corruption.
In the CPI 2023, Brazil’s score stabilized just above the regional average while Mexico’s fell for a fourth consecutive year. In both countries, anti-corruption rhetoric has proven to be stronger than its ability to combat it.
Since the CPI was launched in 2019, the region’s trajectory on anticorruption efforts has been under tension. Attention has shifted toward other issues such as the COVID-19 pandemic and subsequent economic recovery, rising crime, and, in some cases, democratic backsliding. Recent events related to corruption highlight worrying trends, from allegations that high-profile investigations have politically motivated intentions to key appointments that risk derailing anti-corruption efforts.
At the same time, collaboration between the US Department of Justice (DOJ) and its counterparts in Latin America remains solid. Some examples include the DOJ’s Anti-Corruption Task Force, launched in 2021 to combat corruption in Central America; and alliances between the FBI and Brazil, Colombia, and Ecuador. While these efforts demonstrate a certain level of interest in prosecuting white-collar crimes, they are insufficient to reverse the trend of stagnation in fighting corruption across the region.
Brazil stumbles
Brasilia’s anti-corruption agenda gained momentum in 2014 after a multimillion-dollar corruption scandal led to Operation Lava Jato. In 2015, Brazil’s Congress passed several laws aimed at strengthening transparency and accountability in government and reducing corruption. However, despite these efforts, corruption remains pervasive across the country.
In June 2023, Brazil’s electoral court banned former President Jair Bolsonaro from holding public office until 2030 due to his alleged use of state television for campaign purposes and meetings with foreign officials to promote his re-election bid and sow distrust in elections. The ban was imposed as part of a broader investigation into allegations that Bolsonaro conspired to incite an uprising after losing the presidential election in 2022.
While Brazil’s Supreme Court ruled in 2022 that the practice of opaque “secret budgets” was unconstitutional, negotiations between the executive and legislative branches are still heavily influenced by clientelistic practices. The distribution and use of federal funds by lawmakers are carried out with little oversight or transparency, creating a fertile ground for corruption.
Despite this, the CPI 2023 recorded improvements in Brazil’s scores on democracy and political institutions, reflecting its resilience in the face of acute tension over several years, particularly the effective institutional response to unrest on January 8, 2023. However, the current administration is not prioritizing an anti-corruption agenda. Instead, it focuses on economic and environmental issues, and President Luiz Inácio Lula da Silva has openly criticized Operation Lava Jato. He proposed modifying the State-Owned Enterprises Law to allow for political appointments in high-level positions within state-owned enterprises, which raised alarm bells about the risk that these entities would be managed for short-term political gain rather than long-term sustainability. In March of this year, the Supreme Court confirmed restrictions on making such appointments but ruled that those made since the suspension of the law in March 2023 remain valid.
Note: The Corruption Perception Index (CPI) is published by Transparency International and evaluates and ranks 180 countries and territories by their perceived levels of public sector corruption. The CPI scores range from 0 to 100, with 0 indicating high levels of perceived corruption and 100 indicating low levels of perceived corruption. In this text, the CPI score for Brazil has stabilized just above the regional average in the CPI 2023, while Mexico’s CPI score fell for a fourth consecutive year.
The Downward Trajectory of Mexico
In 2023, Mexico fell below the regional average in the legal capacity category of the index. This reflected the stagnation of anti-corruption efforts under President Andrés Manuel López Obrador (AMLO), despite his election on an anti-corruption platform. Through AMLO’s Fourth Transformation agenda, his administration has attempted to weaken or dismantle institutions that serve as checks and balances on government power, as well as oversight bodies responsible for exposing corrupt practices.
Significant corruption cases remain unresolved; the federal government has frequently attacked civil society organizations and journalists; and the Attorney General’s Office has taken politically motivated actions, particularly at the state level, where governors are often accused of interfering in corruption investigations, deciding who is investigated and the speed at which investigations progress.
As AMLO’s term nears its end, these issues have become more pronounced, raising concerns about Mexico’s anti-corruption future. If approved, AMLO’s proposed judicial reform will allow the selection of judges by popular vote. The ruling Morena party’s popularity is likely to extend to any of its potential judicial candidates, allowing it to extend its reach to all three branches of government and potentially shield itself from corruption investigations.
President-elect Claudia Sheinbaum, who will take office on October 1, will inherit a system deeply rooted in corruption, exacerbated by political interference and budget cuts to anti-corruption agencies. Despite this outlook, it appears that, for now, she will follow AMLO’s approach on this front.
The Road Ahead
Undoubtedly, Sheinbaum will face significant challenges on the anti-corruption front. She plans to create a Federal Anti-Corruption Agency that will depend on the executive branch. This dependency is likely to undermine its effectiveness in fighting corruption. This is not to say that moderate improvements are impossible during her term, but at least in her first year, tangible results are doubtful. Meanwhile, in Brazil, the prevalence of opaque mechanisms for fund distribution and political appointments in exchange for congressional support will continue to damage the integrity environment.
However, the positive side is that the continued strengthening of the Public Ministry and the Federal Police, which have played a crucial role in investigating recent corruption cases and punishing corrupt actors, may produce improvements in the coming years. The Federal Police have led most investigations involving Bolsonaro, and the Prosecutor’s Office is leading several corruption investigations involving mayors in Brazil.
While it is unlikely that Mexico and Brazil’s capacity to combat corruption will deteriorate drastically over the next year, significant improvements seem distant. Anti-corruption measures will remain in the background as governments prioritize other issues. This stagnation of anti-corruption initiatives has led to the progressive weakening of the corporate compliance culture in Latin America’s largest economies, exposing companies to greater integrity risks, although corruption will not be an insurmountable obstacle to business operations and future investments in these countries. For the private sector, Mexico’s security situation and Brazil’s tax burden will remain the main challenges.
Source: Infobae
