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CORRUPTION

Skanska quits South America over corruption

Swedish engineering giant Skanska has decided to pull out of the South American market after being dragged into a corruption scandal involving the Brazilian oil major Petrobras.

Skanska quits South America over corruption
File Photo: Gorm Kallestad/TT

Sveriges Radio has reported that Petrobras is being probed on suspicion of shelling out millions in bribes to secure lucrative contracts for refineries and pipelines that Skanska has been building. 

A total of 20 senior managers with construction companies in Brazil have been arrested in connection with the major corruption scandal.

It has emerged that two representatives of Skanska's partners in Brazil have confessed that they paid bribes to Petrobras to secure contracts. No Skanska manager has been arrested as part of the probe.

Following the wake of revelations the Swedish engineering firm has now decided to abandon the emerging South American market.

"The environment in South America has a lot of corruption so of course it is very difficult to work in," said Johan Henriksson, president of Skanska Latin America, to Sveriges Radio.

He said the company is now conducting its own investigation to see whether any bribes were paid on behalf of Skanska.

One of Skanska's partners in the region, Brazilan construction outfit Camargo Corrêa, have featured prominently in the investigation. A representative of the company said he paid millions in bribes in order to secure the gas pipeline contract.

When questioned if Skanska had paid any bribes to land any of its contracts in Brazil in recent years Henriksson replied.

"I don't know. We are following this up internally."

In 2013, Skanska increased its workforce slightly to 55,600 people and announced improved profits after a strong performance in the North American market.  

TT/The Local/pr

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BUSINESS

Sweden slips in global corruption rankings

Sweden has dropped from third to fourth in an annual ranking comparing the levels of perceived corruption around the world.

Sweden slips in global corruption rankings
How corrupt is Sweden? Photo: Fredrik Sandberg/TT

Its Scandinavian neighbour Denmark shared first place with New Zealand in this year's Corruption Perception Index (CPI), released by anti-corruption campaign group Transparency International on Wednesday and ranking how corrupted countries were seen to be in 2016.

Both Denmark and New Zealand were given a score of 90 on the 0 to 100 scale (highly corrupt to very clean), followed closely by Finland and Sweden, which scored 89 and 88 respectively.

While still in the top-five of 176 countries, Sweden found itself pushed down one notch from last year and the group's Sweden office warned that this was no time to be complacent.

“Sweden's good performance in the 2016 index does not mean that we are spared from corruption in the public sector,” Ulla Andrén, chairwoman of Transparency International Sweden, said in a statement.

“Over the past year we have unfortunately seen how core values have wavered considerably. Leading figures have turned out to lack an ethical compass and corrupt behaviour has damaged trust in various public institutions.”

READ ALSO: Why Denmark is world's least corrupt country

Major Swedish institutions were rocked by scandals last year, including claims of cronyism and cover-ups at the state auditor Riksrevisionen and tax agency Skatteverket. Some of the country's largest businesses, such as Telia and Ericsson, have also faced allegations of illicit payouts.

“We believe that everything colloquially referred to as cronyism is corruption,” Lotta Rydström, executive secretary of Transparency International Sweden, told The Local.

“Transparency International's definition of corruption is wider than just bribes: 'Corruption is abuse of entrusted power for personal gain', which includes nepotism, buddy contracts and so on.”

“I would probably also say that several bribe-related incidents in the business world have shown that Sweden is not as spared (from corruption) as many think,” she said.

Rydström warned that the corruption index does not cover local and regional councils, where much of the political decisions are made in Sweden. Municipalities and county councils make up around 70 percent of public administration in the country.

“A high rating does not mean that we can beat our chest and say we are still almost the best student in the classroom. Good can get better and there is plenty to work on. Public procurement, municipal auditing and whistleblower protection are some of the issues we are working on.”

As a whole, Transparency International said that no nation in the world – Sweden included – is doing enough to fight corruption.

“There are no drastic changes in Europe and Central Asia in the Corruption Perceptions Index 2016, with only a few exceptions. However, this does not mean that the region is immune from corruption. The stagnation does not indicate that the fight against corruption has improved, but quite the opposite,” it wrote in the report.