The most needy countries are often the most corrupt. Because of the need for accountability to donors, some form of loan conditionality for borrowers is inevitable, but it should not take a mechanical form. The World Bank should concentrate on public sector reform and on supporting service delivery projects that are insulated from the corrupt environment.
Administrative corruption is widespread and involves public officials at all levels of government.
It affects a cross section of business interests and individuals. A high proportion of managers' time is spent maneuvering with governments. Government procurement processes may be contaminated by payoffs to obtain business and by conflicts of interest in which public officials and their families have financial stakes in firms that do business with the state. For example, in Boris Yeltsin's Russia, Pavel Borodin, the Kremlin's property manager, awarded renovation contracts to a Swiss firm alleged to have connections with his family and perhaps with Yeltsin as well. Such corruption affects both business firms and ordinary citizens.