Informal payments to public officials (% of firms) - Country Ranking

Definition: Informal payments to public officials are the percentage of firms expected to make informal payments to public officials to "get things done" with regard to customs, taxes, licenses, regulations, services, and the like.

Source: World Bank, Enterprise Surveys (http://www.enterprisesurveys.org/).

See also: Thematic map, Time series comparison

Find indicator:
Rank Country Value Year
1 Vietnam 90.70 2015
2 Papua New Guinea 89.30 2015
3 Timor-Leste 85.60 2015
4 Syrian Arab Republic 83.80 2009
5 Solomon Islands 81.90 2015
6 Congo 81.80 2009
7 Ukraine 73.10 2013
8 Lao PDR 70.20 2016
9 Algeria 66.60 2007
10 Cambodia 66.30 2016
11 Guinea-Bissau 63.10 2006
12 Philippines 59.40 2015
13 Nigeria 55.30 2014
14 Yemen 55.00 2013
15 Liberia 52.80 2017
16 The Gambia 52.40 2006
17 Kyrgyz Republic 51.20 2013
18 Dem. Rep. Congo 50.40 2013
19 Angola 48.90 2010
20 Guinea 48.70 2016
21 Bangladesh 48.50 2013
22 Sierra Leone 46.00 2017
23 Pakistan 45.80 2013
24 Cameroon 45.60 2016
25 Mali 43.90 2016
26 Madagascar 43.10 2013
27 Chad 41.80 2009
27 Gabon 41.80 2009
27 Central African Republic 41.80 2011
30 Afghanistan 39.30 2014
31 Malaysia 37.50 2015
32 Tajikistan 37.20 2013
33 Hungary 35.30 2013
34 Benin 33.40 2016
35 Iraq 31.80 2011
36 Burundi 31.20 2014
36 Mongolia 31.20 2013
38 Panama 30.50 2010
39 Niger 29.40 2017
40 Samoa 29.30 2009
41 Côte d'Ivoire 29.20 2016
42 Kenya 28.20 2013
43 Uganda 27.80 2013
43 Mauritania 27.80 2014
45 Ghana 24.30 2013
46 Venezuela 23.70 2010
47 Greece 21.60 2005
48 Peru 21.40 2010
49 Indonesia 21.00 2015
50 Lebanon 20.90 2013
51 Russia 20.50 2012
52 Kazakhstan 20.40 2013
53 Tanzania 20.00 2013
54 Bolivia 19.20 2017
55 The Bahamas 19.10 2010
56 Egypt 19.00 2016
57 Slovak Republic 18.70 2013
57 Romania 18.70 2013
59 Guyana 18.40 2010
60 Albania 18.30 2013
61 Bulgaria 18.20 2013
61 Argentina 18.20 2010
63 Jamaica 17.90 2010
64 Thailand 17.60 2016
64 Montenegro 17.60 2013
66 Swaziland 17.00 2016
67 Malawi 16.60 2014
67 India 16.60 2014
69 Myanmar 16.50 2016
70 Moldova 16.40 2013
71 Morocco 15.90 2013
72 Dominican Republic 15.30 2016
73 South Africa 15.10 2007
74 Mozambique 14.80 2007
75 Barbados 14.70 2010
76 Portugal 14.50 2005
77 Zimbabwe 14.40 2016
78 Poland 14.30 2013
78 Nepal 14.30 2013
80 Slovenia 14.00 2013
80 Korea 14.00 2005
82 Lesotho 13.80 2016
83 Sri Lanka 13.70 2011
84 Trinidad and Tobago 13.40 2010
85 Croatia 13.30 2013
86 Belarus 13.20 2013
87 Tonga 12.70 2009
88 Brazil 12.50 2009
89 Djibouti 12.10 2013
90 Serbia 11.90 2013
91 Mexico 11.60 2010
92 Honduras 10.90 2016
93 Czech Republic 10.70 2013
93 China 10.70 2012
95 Fiji 10.20 2009
96 Nicaragua 10.00 2016
97 Zambia 9.50 2013
98 Lithuania 9.10 2013
99 Burkina Faso 8.50 2009
100 Ireland 8.30 2005
100 Ethiopia 8.30 2015
102 Paraguay 8.20 2017
102 Macedonia 8.20 2013
104 Uruguay 8.10 2010
105 Suriname 8.00 2010
106 Jordan 7.70 2013
107 Botswana 7.30 2010
108 Grenada 7.10 2010
109 Latvia 6.70 2013
110 Azerbaijan 6.60 2013
111 Senegal 6.30 2014
111 Guatemala 6.30 2010
113 Rwanda 6.20 2011
113 Togo 6.20 2016
115 St. Kitts and Nevis 6.10 2010
116 Cabo Verde 6.00 2009
117 Bosnia and Herzegovina 5.90 2013
117 Mauritius 5.90 2009
119 Sudan 5.80 2014
119 Turkey 5.80 2013
121 Tunisia 5.70 2013
122 El Salvador 5.50 2016
123 Antigua and Barbuda 4.80 2010
124 Namibia 4.60 2014
124 Armenia 4.60 2013
126 Spain 4.40 2005
126 Ecuador 4.40 2017
128 Vanuatu 4.20 2009
129 Costa Rica 3.70 2010
130 Uzbekistan 3.50 2013
131 Belize 3.00 2010
132 St. Vincent and the Grenadines 2.80 2010
132 Colombia 2.80 2010
134 Georgia 1.90 2013
135 Chile 0.70 2010
136 St. Lucia 0.40 2010
137 Estonia 0.20 2013
137 Israel 0.20 2013
139 Bhutan 0.10 2015
140 Dominica 0.00 2010
140 Eritrea 0.00 2009

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Development Relevance: Firms evaluating investment options, governments interested in improving business conditions, and economists seeking to explain economic performance have all grappled with defining and measuring the business environment. The firm-level data from Enterprise Surveys provide a useful tool for benchmarking economies across a large number of indicators measured at the firm level. Corruption by public officials may present a major administrative and financial burden on firms. Corruption creates an unfavorable business environment by undermining the operational efficiency of firms and raising the costs and risks associated with doing business. In some countries doing business requires informal payments to "get things done" in customs, taxes, licenses, regulations, services, and the like. Such corruption can harm the business environment by distorting policymaking, undermining government credibility, and diverting public resources.

Limitations and Exceptions: The sampling methodology for Enterprise Surveys is stratified random sampling. In a simple random sample, all members of the population have the same probability of being selected and no weighting of the observations is necessary. In a stratified random sample, all population units are grouped within homogeneous groups and simple random samples are selected within each group. This method allows computing estimates for each of the strata with a specified level of precision while population estimates can also be estimated by properly weighting individual observations. The sampling weights take care of the varying probabilities of selection across different strata. Under certain conditions, estimates' precision under stratified random sampling will be higher than under simple random sampling (lower standard errors may result from the estimation procedure). The strata for Enterprise Surveys are firm size, business sector, and geographic region within a country. Firm size levels are 5-19 (small), 20-99 (medium), and 100+ employees (large-sized firms). Since in most economies, the majority of firms are small and medium-sized, Enterprise Surveys oversample large firms since larger firms tend to be engines of job creation. Sector breakdown is usually manufacturing, retail, and other services. For larger economies, specific manufacturing sub-sectors are selected as additional strata on the basis of employment, value-added, and total number of establishments figures. Geographic regions within a country are selected based on which cities/regions collectively contain the majority of economic activity. Ideally the survey sample frame is derived from the universe of eligible firms obtained from the country’s statistical office. Sometimes the master list of firms is obtained from other government agencies such as tax or business licensing authorities. In some cases, the list of firms is obtained from business associations or marketing databases. In a few cases, the sample frame is created via block enumeration, where the World Bank “manually” constructs a list of eligible firms after 1) partitioning a country’s cities of major economic activity into clusters and blocks, 2) randomly selecting a subset of blocks which will then be enumerated. In surveys conducted since 2005-06, survey documentation which explains the source of the sample frame and any special circumstances encountered during survey fieldwork are included with the collected datasets. Obtaining panel data, i.e. interviews with the same firms across multiple years, is a priority in current Enterprise Surveys. When conducting a new Enterprise Survey in a country where data was previously collected, maximal effort is expended to re-interview as many firms (from the prior survey) as possible. For these panel firms, sampling weights can be adjusted to take into account the resulting altered probabilities of inclusion in the sample frame.

Original Source Notes: All surveys were administered using the Enterprise Surveys methodology as outlined in the Methodology page which can be found from www.enterprisesurveys.org.

Statistical Concept and Methodology: Firm-level surveys have been conducted since the 1990's by different units within the World Bank. Since 2005-06, most data collection efforts have been centralized within the Enterprise Analysis Unit. Surveys implemented by the Enterprise Analysis Unit follow the Global Methodology. Private contractors conduct the Enterprise Surveys on behalf of the World Bank. Due to sensitive survey questions addressing business-government relations and bribery-related topics, private contractors, rather than any government agency or an organization/institution associated with government, are hired by the World Bank to collect the data. Confidentiality of the survey respondents and the sensitive information they provide is necessary to ensure the greatest degree of survey participation, integrity and confidence in the quality of the data. Surveys are usually carried out in cooperation with business organizations and government agencies promoting job creation and economic growth, but confidentiality is never compromised. The Enterprise Survey is answered by business owners and top managers. Sometimes the survey respondent calls company accountants and human resource managers into the interview to answer questions in the sales and labor sections of the survey. Typically 1200-1800 interviews are conducted in larger economies, 360 interviews are conducted in medium-sized economies, and for smaller economies, 150 interviews take place. The manufacturing and services sectors are the primary business sectors of interest. This corresponds to firms classified with ISIC codes 15-37, 45, 50-52, 55, 60-64, and 72 (ISIC Rev.3.1). Formal (registered) companies with 5 or more employees are targeted for interview. Services firms include construction, retail, wholesale, hotels, restaurants, transport, storage, communications, and IT. Firms with 100% government/state ownership are not eligible to participate in an Enterprise Survey. Occasionally, for a few surveyed countries, other sectors are included in the companies surveyed such as education or health-related businesses. In each country, businesses in the cities/regions of major economic activity are interviewed. In some countries, other surveys, which depart from the usual Enterprise Survey methodology, are conducted. Examples include 1) Informal Surveys- surveys of informal (unregistered) enterprises, 2) Micro Surveys- surveys fielded to registered firms with less than five employees, and 3) Financial Crisis Assessment Surveys- short surveys administered by telephone to assess the effects of the global financial crisis of 2008-09. The Enterprise Surveys Unit uses two instruments: the Manufacturing Questionnaire and the Services Questionnaire. Although many questions overlap, some are only applicable to one type of business. For example, retail firms are not asked about production and nonproduction workers. The standard Enterprise Survey topics include firm characteristics, gender participation, access to finance, annual sales, costs of inputs/labor, workforce composition, bribery, licensing, infrastructure, trade, crime, competition, capacity utilization, land and permits, taxation, informality, business-government relations, innovation and technology, and performance measures. Over 90% of the questions objectively ascertain characteristics of a country’s business environment. The remaining questions assess the survey respondents’ opinions on what are the obstacles to firm growth and performance. The mode of data collection is face-to-face interviews.

Aggregation method: Unweighted average

Periodicity: Annual