Thursday, March 06, 2014

How regulation and bureaucracy can drive corruption: Bangladesh edition

A somewhat random excerpt in a Forbes article:

With gusto he describes how he and Nobel Peace Prize-winner Muhammad Yunus hatched a plan to build a humane clothing factory, where all profits would go back into the community for schools and hospitals. At best, the Otto Group would recoup its initial investment. Immediately they faced red tape. Electricity would take five years. Officials wanted bribes. Otto refused to base a social business on a corrupt footing and walked away. “It’s unbelievable,” says Otto, pounding on his wooden desk in his corner office in Hamburg, Germany. “You would think the government must be happy somebody is building such a company and leaving the money in the country.”
Unfortunately stories like this are far from being confined to Bangladesh. These are stories echoed repeatedly through the developing world because governments have chosen to condemn their own people to poverty.

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