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Real Estate Corruption Tarnishes Spain’s Reputation

Corruption and scandals in urban planning and construction have negatively affected Spain’s image, as reflected in the Corruption Perceptions Index (CPI), a yearly report published by Transparency International (TI).

The study indicates that Spaniards’ perception regarding corruption in the public sector has increased, relegating Spain to the unenviable position of number 25 among the least corrupt countries in the world. A total of 163 countries figured on the list developed by the anti-corruption organization.

This is the second year in a row that Spain’s position in the ranking has suffered, a development seen in the report as “worrying” and as “requiring measures.”

Spain, which in the last two years had scored above average with a 7.1 in 2004 and a 7.0 in 2005, scored a 6.8 in its fight against corruption in 2006.

This puts the country below Finland (9.6), Iceland (9.6), Singapur (9.4), Australia (8.7), the United Kingdom (8.6), France (7.4), the United States (7.3) and Chile (7.3); and above countries like Portugal (6.6), Italy (4.9), Greece (4.4) and Poland (3.7).New Zealand and Denmark figure as the most transparent and Myanmar, Somalia, Iraq and Venezuela as the most corrupt.

The report explains how famous cases in Spain like Operation Malaya (an anti-corruption campaign led by a prominent Spanish judge) and Ballena Blanca (a similar initiative that uncovered the country’s largest money-laundering operation) have brought to light the level of corruption in Spain’s public administration to the Spanish public.

The president of TI’s Spanish chapter, Jesús Luzcano, explained however that Spain finds itself in a central position in its fight against corruption in Europe and that the perception of corruption “isn’t alarming” with regard to institutions, the judicial, executive and legislative powers or the progress of democratic development.

What has provoked Spain to fall in the CPI index is the level of corruption in the urban development sector, which prompted Lizcano to support an agreement with the government to curb corruption. One step will be the creation of an index of transparency for Spanish city councils.

According to TI, bad local financing, the “peculiar” Spanish urban planning system and the lack of transparency of local corporations has caused the perception of corruption to increase.

Lizcano pointed out that although the actual level of corruption, however, may not have increased, but that the perception of it has because scandals have only been surfacing lately.

During the presentation of the report, TI’s president confirmed that the lack of transparency in the urban development sector should be at the top of Spain’s agenda. Thanks to the deceleration of the property market and new legislative acts that aim to improve Spain’s transparency, this coming year will constitute a time of reflection to this end.


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