If You're Doing Business In China, Here's Where You'll Find Most Corruption
According to a report put together by Charney Research, 35 percent of Chinese firms surveyed said they've had to pay bribes in order to operate. Data is based off a survey of 2,300 firms across China and 27 interviews, spanning a range of industries.
The report said businesses end up paying mainly to keep up with competition. Bribes will also get them more access to raw materials and supplies needed to do business.
One Beijing director told Charney Research, "It's common in the business field in China (to offer bribes). Peer competition for customers is fierce." Another respondent said bribery is "an unspoken rule of the industry."
Drawn from survey data, here's where Charney Research determined corruption runs the most rampant.
Beijing is the most corrupt region, with 43 percent of firm reporting having to pay bribes:
Hong Kong-owned firms were also more likely to pay bribes at 44 percent, compared to foreign firms at 37 percent, and mainland China firms at 32 percent.
Industry-wise, real estate and manufacturing are most prone to corruption:
Local officials benefit most from bribes, the report said. Out of the businesses that have to pay bribes, 79 percent of them said the money and gifts went to local government officials. Then came tax collectors at 56 percent, national government officials at 34 percent, customs officials at 22 percent and road police at 11 percent.
Not surprisingly, the majority of firms paying these bribes want this system gone. Nine out of ten firms said corruption is a plague, and 61 percent said that more action need to be taken to fix the problem. In contrast, 29 percent acknowledged the problem, but said nothing can be done about it.