Berlin  - Afghanistan and Somalia, two countries currently embroiled in conflict, are the world's most corrupt nations, according to a study published in Berlin on Tuesday.

The annual report by Transparency International (TI), an anti- corruption watchdog, scores 180 countries on the perceived level of public sector corruption. The least corrupt state according to the report in 2009 is New Zealand, closely followed by Denmark and Singapore.

"Bribery, cartels and other corrupt practices undermine competition and contribute to massive loss of resources for development in all countries, especially the poorest ones," the report said.

TI's methodology relies on surveys of country analysts and business people to determine how corruption operates in everyday life. The group defines corruption as the "abuse of entrusted power for private gain."

The report said that a global economic recovery was threatened by corruption, which could reduce the effectiveness of stimulus packages and "fast-track disbursements of public funds".

The particularly poor result for Afghanistan, which has failed to improve its score on the TI index since 2008, comes at a time when Western leaders have openly berated President Hamid Karzai for the corruption of his government and the conduct of recent elections there.

TI described public sector corruption in Afghanistan as "rampant ... ranging from public posts for sale and justice for a price to daily bribing for basic services."

"It affects both individual citizens trying to do things like get passports or driving licences. But also the perception is of widespread political corruption at the top. The only way to fight corruption is to tackle both," Robin Hodess, TI's director of policy and research told the German Press Agency dpa.

Somalia's score was the lowest in Africa, as was the case in 2008, "continued conflict and corruption prevent it from embarking on reforms to overcome economic and political collapse," the report said.

The Horn of Africa nation has been embroiled in chaos since the 1991 ouster of dictator Mohamed Siad Barre.

In Europe, several members of the European Union were singled out for criticism. In Bulgaria, despite a new, reform-minded government, action to "curb political corruption and address organized crime had yet to be introduced," TI said.

"Systemic weaknesses" were also present in Greece, which registered a significant index drop from 2008, after a string of corporate corruption scandals.

Romania, Latvia and Slovakia all registered worsening scores on the index.

However Poland posted an improved anti-corruption performance, TI said, following the establishment there of a ministerial office for anti-corruption and other government-led efforts.

Overall, TI said that good scores were achieved where "political stability, long established conflict of interest regulations and solid, functioning public institutions" were present. (dpa)