Africa will have to enact stronger regulations to ensure that powerful elites – who are working with multinational companies to steal billions from the continent through illicit financial flows – are arrested.
Also, calls for African leaders to simply be transparent will not cut it anymore in the face of large-scale hunger, malnutrition and unemployment, which are tearing through the continent while over N$600 billion is shipped Europe annually through corrupt and corruptible African politicians and officials.
Vast amounts of money are siphoned out of Africa through complex financial transactions and strategies used by large corporations and organised criminals to evade taxes and hide their ill-gotten wealth. It is estimated that for every euro invested in Africa, ten Euros are extracted from the continent through illicit dealings, one visiting parliamentarian said.
These concerns were echoed by a local economist and visiting diplomats during the ongoing 42nd session of the African, Caribbean and Pacific (ACP) Group of States and the 31st EU Joint Parliamentary Assembly in the capital, which has attracted about 350 parliamentarians from 28 EU and 79 ACP countries.
This comes only weeks after President Hage Geingob informed a meeting of heads of anti-corruption agencies in Commonwealth Africa to close the taps of corruption, which leaking billions, if not trillions of dollars, of much-needed funds out of the continent.
Responding to queries from New Era on the subject, ACU-EU co-president Netty Baldeh from Gambia, stressed there is hope that member parliaments will adopt strong policies on transparency, “… just like like in Europe to transparently monitor money that has been made in extractive industries in their countries and be able to equitably channel those profits to everyone,” Baldeh noted.
He echoed the words of co-president Michele Rivasi from France, who indicated that there is a need for African leaders to work together to ensure transparency in their own countries. She added that there are leaders, not only in Africa but also on other continents, who are siphoning money from their countries and hiding it in offshore and foreign bank accounts.
Local economist Omu Kakujaha-Matundu begged to differ and pointed out that talking about being transparent is not enough. “A fish rots from the head and the head is rotten. We haven’t seen serious efforts from African leaders to be transparent. We have not seen any, even when we come closer to home, South Africa and Namibia, we haven’t seen those in the top leadership being fired after being implicated in corrupt practices,” Kakujaha-Matundu explained.
“The call for transparency is nothing new. Everybody knows that if you have transparency you will know the money trail and the tax authority will know who pays how much tax from your income. But the problem is that we haven’t seen any serious efforts from our leaders to do that.”
“I do not think that through the electorate, consciousness is raised on the importance of paying taxes.” He continued, saying politicians who are found to have abused their offices and/or stole money from their countries should not be voted into public office again.
“Then, only then, perhaps we can see some change in the African leaders’ attitude towards corruption, because [currently] there is no punishment for corrupt leaders.”
The concerns over the illicit financial flows out of Africa were highlighted last year in a report by former South African President Thabo Mbeki to the African Union (AU), in which he stressed that Africa faces a great challenge with large volumes of capital leaving the continent illicitly.
This was also highlighted by the United Nations and African Union Regional Anti-Corruption Programme for Africa (2011-2016), which uncovered that the socio-economic and political cost of corruption is multi-faceted in Africa, and in addition, illicit financial flows – especially by multinational corporations – continue to deny African countries the much-needed financial resources for development.
Global Financial Integrity, a US-based think tank estimates that illicit outflows increased from U$1.06 trillion in 2006 to approximately U$1.26 trillion in 2008, with average annual illicit outflows from developing countries averaging U$725 billion to U$810 billion per year over the period 2000-2008.