Illegal money flows from Africa near $90 billion, U.N. study says

Date:

Geneva (Reuters) – Africa is losing nearly $89 billion a year in illicit financial flows such as tax evasion and theft, amounting to more than it receives in development aid, a U.N. study showed on Monday.

The estimate, in the United Nations Conference on Trade and Development’s (UNCTAD) 248-page report, is its most comprehensive to date for Africa. It shows an increasing trend over time and is higher than most previous estimates.

The report calls Africa a “net creditor to the world,” echoing economists’ observations that the aid-reliant continent is actually a net exporter of capital because of these trends.

“Illicit financial flows rob Africa and its people of their prospects, undermining transparency and accountability and eroding trust in African institutions,” said UNCTAD Secretary-General Mukhisa Kituyi.

Junior Davis, head of policy and research at UNCTAD’s Africa division, told Reuters the figure was likely an underestimate, citing data limitations.

Nearly half of the total annual figure of $88.6 billion is accounted for by the export of commodities such as gold, diamonds and platinum, the report said. For example, gold accounted for 77 percent of total underinvoiced exports worth $40 billion in 2015, it showed.

Understating a commodity’s true value helps conceal trade profits abroad and deprives developing countries of foreign exchange and erodes their tax base, UNCTAD said.

Tackling illicit flows is a priority for the United Nations, whose General Assembly adopted a resolution on this in 2018, and the report urges African countries to draw on the report to present “renewed arguments” in international forums.

Share post:

Related

Latest

For Kuwait’s new emir, Saudi ties are seen as key

Kuwait (Reuters) - Sheikh Meshal al-Ahmad al-Sabah was named...

Pope Francis deplores Israeli killings of civilians at Gaza church

Vatican City (Reuters) - Pope Francis on Sunday again...

Palestinians must find new path from Israeli rule after war, top official says

Ramallah (Reuters) - Immediately after Israel's war in Gaza...

Israel says it struck Hezbollah sites after attacks from Lebanon

Jerusalem/Beirut (Reuters) - Israel said on Sunday it had...