Backwards in Blacklisting: Enabling Corruption in Procurement

Abstract

Failure to tackle corruption is a key factor that contributed to the economic crisis the country is faced with today. Taking concrete steps to reduce corruption, therefore, is critical to recover from the current crisis and to put the country on a sustainable growth path. Public procurement is an important area the country has to focus on in its fight against corruption. Public procurement refers to the purchasing of goods and services by the government, ranging from stationary items to services of contractors to construct ports and power plants. Corruption in procurement pushes up the price of contracts, leading to the waste of scarce public funds. Research indicates that the amount lost on public contracts due to corruption can amount to 10–25% of a public contract’s value on average. This article points out one of the critical shortcomings in the public procurement regulatory framework in Sri Lanka that makes it highly vulnerable to corruption. The current regulatory framework fails to recognise engaging in fraudulent and corrupt activities during procurement as a valid reason for blacklisting. Sri Lanka is in fact a backward outlier in the South Asian region in this respect.