Corruption Threatens China's Future

Publication Date: October 2007

Publisher: Carnegie Endowment for International Peace

Author(s): Minxin Pei

Research Area: Government; Politics

Type: Brief

Coverage: China

Abstract:

Failure to contain endemic corruption among Chinese officials poses one of the most serious threats to the nation's future economic and political stability, says a new report from the Carnegie Endowment. Minxin Pei, an expert on economic reform and governance in China, argues that corruption not only fuels social unrest and contributes to the rise in socioeconomic inequality, but holds major implications beyond its borders for foreign investment, international law, and environmental protection.

In Corruption Threatens China's Future, Pei paints a sobering picture of corruption in China, where roughly 10 percent of government spending, contracts, and transactions is estimated to be used as kickbacks and bribes, or simply stolen. He examines the root causes for China's rampant corruption--partial economic reforms, lax enforcement efforts, and reluctance by the Communist Party to adopt political reforms--and the ensuing economic losses and jeopardized financial stability.