Room for improvement: Why Korea's leading ICT ODA program has failed to combat corruption

Abstract

In the past decade Korea has become the world's top provider of Information and Communication Technology (ICT) aid to developing countries. E-government reforms helped Korea cut domestic corruption, and research has established a clear causal relationship between ICT, E-government, and lower corruption. GMM dynamic panel data analysis indicates, however, that Korean ICT aid has in fact exacerbated corruption in recipient nations. ICT ODA from Canada and the U.K., the second and third largest national donors, however, successfully reduced recipient corruption levels. Why? The characteristics of recipients targeted by each respective donor and key differences in national ODA program goals and management systems explain the results. Tobit regressions reveal that economic and security motives led Korea to favor recipients that were poorer and more authoritarian with inferior governance institutions, traits which fixed and random effect regressions show lower E-governments effectiveness against corruption. Canada and the U.K. primarily succeeded by designating good governance as a core ODA goal and by pioneering Results Based Management systems to realize program objectives. They established clear goals, linked them to quantifiable indicators, independently evaluated the results and transparently released that information to the public. Good governance was not at the center of the Korean aid program which failed to establish clear targets, credibly measure results or release information, providing fertile ground for graft, like the Choi Soon-shil scandal, to infect the program. To improve ICT ODA effectiveness against corruption, therefore, Korea must elevate good governance as a core aid objective, accelerate introduction of RBM reforms to increase effectiveness, and direct more aid to recipients with greater civil liberties in which leaders are motivated to effectively employ ICT ODA against corruption.