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Mbeki said that over the past 50 years, Africa had lost over one trillion dollars in illicit financial outflows

Former South African president Thabo Mbeki has called on African leaders to stem illicit financial outflows that have robbed the continent of billions of dollars.

Highlights:

  • Mbeki, who chairs the African Union High Level Panel on Illicit Financial Flows from Africa, was addressing the Pan African Parliament in Midrand, South Africa
  • Currently, African countries are losing $50-billion a year through these outflows, according to the International Monetary Fund.
  • The report showed that 60% of the illicit financial flows is from the activities of big companies. 

Details

Mbeki made the call to the Pan African Parliament in Midrand, as he presented a report on illicit financial outflows from the continent.

The former president chairs the African Union High Level Panel on Illicit Financial Flows from Africa, established by African ministers of finance and the UN Economic Commission for Africa.

Mbeki said that over the past 50 years Africa had lost in excess of $1-trillion in illicit financial outflows.

The International Monetary Fund reports that African countries are currently losing $50-billion a year through these outflows.

But this was an understatement of the problem, Mbeki said.

Illicit funds“The figure excluded such elements as trade in services and intangibles, and the proceeds of bribery and trafficking in drugs, people and firearms,” he said.

 

MDG targets missed

He highlighted that most African countries had failed to meet their Millennium Development Goals, adopted in 2000, because of insufficient capital to finance the actions required.

The UN has estimated that the number of Africans living on less than $1.25 a day increased from 290 million in 1990 to 414 million in 2010. Per capita domestic product in Africa is reckoned to be one-fifth of the global average.

“These statistics make the unequivocal statement that Africa needs large volumes of capital effectively to address the challenge of eradication of poverty and underdevelopment.

“It is precisely in this context that the imperative stands out that everything should be done to stop the illicit financial outflows, which contribute so much to depleting the capital our continent so urgently needs,” Mbeki said.

The report showed that 60% of the illicit financial flows is from the activities of big companies.

Drug trafficking accounted for 30% of illicit financial outflows, followed by corruption.

NP/Timeslive

 

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