Multinationals Account For 60% Of Illicit Financial Outflows In Africa – Mbeki
- Abuja: Leadership, 2014.
The article is based on presentations made by Thambo Mbeki, at a high-level event, ‘Tackling Illicit Financial Flows and Inequality in Africa,’ on the sidelines of the World Economic Forum (WEF) on Africa in Abuja. Commercial companies operating in Africa account for about 60 per cent of the illicit financial outflows which drain the continent’s domestic reserves and depriving it of crucial investment funds. Mbeki, who is also the chairman of the panel on illicit financial outflows set up by ministers of finance in Africa, said that the continent was losing needed funds and something needs to be done about it. It is estimated that Africa has lost over $1.4trillion in illicit financial outflows in the last three decades, which is about $50billion to $80billion yearly.The disclosure challenges traditional thinking that corrupt practices such as bribery and embezzlement by African politicians are the major sources of illicit financial outflows.According to estimates by Global Financial Integrity, corrupt activities such as bribery and embezzlement make up only about 3 per cent of illicit outflows; criminal activities such as drug trafficking and smuggling make up 30 to 35 per cent and commercial transactions by multinational companies make up a whopping 60 to 65 per cent.
ADVANCE FREE-FRAUD, CAPITAL FLIGHT, CAPITAL INFLOW
