‘Africa loses $50bn annually to illicit financial flows’

Thomas Quartey, deputy chairman of the African Union commission, on Thursday said African countries were losing an average of 50 billion dollars annually through Illicit Financial Flows (IFFs).

Quartey said this in Abuja at a preparatory meeting towards Nigeria’s role as the champion of the 2018 African Union themed, ‘Winning the Fight against Corruption: A Sustainable Path to Africa’s Transformation’.

According to him, the money was being siphoned through the activities of multinational companies operating in the continent who embezzle its resources through massive corruption.

He also said corruption flourished in an environment where public and private sector structures such as the rule of law and transparency of proceedings failed to protect and treat fairly the various stakeholders.

He however said the problem of corruption in Africa could not be tackled by crafting policies, which are exclusively domestic-oriented.

“This is taking place through weak transparency and accountability mechanisms that allow tax avoidance, trade misinvoicing, abusive transfer pricing, and many other ways used to deny Africa to reap its resources dividends,” Quartey said.

“As a result, the continent loses an annual basis, an average of 50 million dollars through the IFFs.

“These funds could be used to drive socio-economic development and structural transformation of this continent to address major problems of unemployment, inequality, poverty and underdevelopment.

“In the extractive sector, illegal logging and mining, diversion of oil revenue and illicit appropriation of public assets have emerged as the overwhelming challenges of corruption.

“At a minimum, there is need to sharply increase the transparency of the international financial system and to augment the capacity of States, so as to place an obstacle to illicit financial flows.”