Corruption and sustainability development are serious agendas in recent scenarios due to the government wanting to achieve the SD goal of 2030. Therefore, this work analyzes the impact of sustainability development, corruption, and FDI inflows on economic growth (EG) in BRICS and G7. In this chapter, the authors consider two contrast group of countries (developing and developed) and why they are dissimilar to each other in terms of sustainable development, corruption, FDI inflow, and economic growth. In this chapter, 25 years of data set has been analyzed, between the years 1995-2019. According to the analysis results, although it was not statistically significant, a positive relationship was found between SDI and EG in BRICS countries, and a negative relationship was found in G7 countries. The main problem here is that while the G7 countries provide economic development, it is important to minimize the environmental impact in order to ensure that this development is sustainable.
TopIntroduction
The Economic Growth (EG) of Brazil, Russia, India, China, South Africa (BRICS) and G7 is affected by corruption which also disturbs the maintenance of the Sustainable Development Goals (SDGs). These countries have undermined the quality of education, government instable decisions, and lack of trust. Corruption threatens EG due to discouraging fair competition, trade practices, and investment. It highly affects new business projects, develop inequality, and reduces wealth (UNODC, 2018). For the preventing corruption, SDGs help and create new jobs, protects our planet, secure water and improvement in air quality, enhance healthy people and reduce poverty. To prevent corruption, SDGs helps and creates jobs, protects our planet, secures water and improvement air quality, enhances healthcare, and reduces poverty (UNPD, 2019). To achieve SDG 2020 as well as EG, it is necessary to support by the researchers, economists, and government practitioners. Thus, our study protects the opinion that EG should be a priority of every economy but under the limit of SDGs. Moreover, corruption considerations should be part of the equation because control of corruption comes under SDG 16. Then, if control of corruption works in proper manner, we can achieve SDGs as well as increase the EG. There are some research questions that are framed to achieve our objectives. These research questions are directly related to this analysis, and formulated as follow: Can control of corruption bring more Sustainable Development (SD) to any economy?
For achieve this question three hypotheses were framed as a part for present research:
- 1.
EG will be influenced by the corruption and SDDs in selected two different groups of countries.
- 2.
EG will be high if Foreign Direct Investment (FDI) inflow will high in BRICS and 7G.
- 3.
SDGs promotes EG in selected two different groups of countries.
For the proof of hypothesis 1 (Biermann et al., 2017) noted that “the success of SDGs will depend on a number of institutional factors like quality education, good governance arrangements, integrated global governance, law of rules, flexible governance”. Although, if these variables affect to SD in negative way, then corruption will also affect to SD in negative way because corruption is the indicator of good governance. Thus, SD and corruption is most significant factor of the EG then it will be negatively influenced by the corruption and suitable development. It is majorly argued that the accomplishment of SDGs depends on the institutional environment of any economy but with many ways, the weakness of government institutional and inheritance of corruption in particular manner, both are major barrier to the accomplishment of SDGs (UN, 2019 and Mugellini and Villeneuve, 2019). In developing countries, corruption hinders EG, innovation, reduces creative thoughts, high economic losses (Ugur & Dasgupta, 2011). Corruption seems to affect business initiatives, designs, rules and regulations; investment projects and reduces the capability of access to resources in the nation (Jain, 2001, p. 72). It may reduce commercial initiative that may not support to SDGs especially in developing countries. Because in developing counties remains weak institutional facilities, lack of awareness about how reduces the corruption, not support to FDI inflows, weakness government. This paper is executed with two main objectives: firstly, it shows trend of SDGs, Corruption Perceptions Index (CPI) and EG of BRICS and G7 economies during 1995-2019. Secondly, to analyze impact of corruption, FDI inflows and SDGs on EG in BRICS and G7 economies. Thirdly, compare the developing countries with developed countries and try to find out the why developing countries still behind the developed countries in term of achieve the SDGs with control of corruption.