Monday, June 17, 2013

Mbeki to chair high level meeting on illicit financial flows
By Chiwoyu Sinyangwe
Fri 14 June 2013, 14:01 CAT

COMMENT - $50 billion? That's nothing. Try $750 billion a year, and not from tax evasion only, but from foreign ownership of our national resources. - MrK

FORMER South African president Thabo Mbeki is on Monday expected in Lusaka to chair a two-day high level meeting on illicit financial flows. Mbeki will, during his stay in Zambia, meet President Michael Sata to enhance dialogue and policy discourse on the matter.

The high-level panel composed of nine other distinguished personalities from within and outside Africa would seek to find ways of plugging the debilitating problem of illicit financial outflows from Africa estimated at US $50 billion annually.

The high-level panel, established by the Economic Commission for Africa and the African Union, was inaugurated in February 2012.

"The Panel is chaired by President Mbeki, former president of South Africa, and composed of nine other distinguished personalities from within and outside Africa," read a statement from the Economic Commission of Africa.

"Illicit financial flows constitute, among others, undocumented commercial transactions and criminal activities characterised by overpricing, tax evasion and false declarations facilitated by some 60 international tax havens and secrecy jurisdictions that enable creating and operating of millions of disguised corporations, shell companies, anonymous trust accounts, and fake charitable foundations. Other techniques used include money laundering, transfer pricing and corruption."

According to the statement, the level of illicit financial outflows from Africa exceeds the official development assistance to the continent, which stood at US$46.1 billion in 2012.

"While illicit financial flows are a global problem, their impact on the continent is monumental thereby representing a significant threat to Africa's governance and economic development," read the statement in part.

"Current evidence shows that Africa lost over US$854 billion in illicit financial flows between 1970 and 2008 corresponding to a yearly average of about US$22 billion. The trend has been increasing over time and especially in the last decade, with an annual average illicit financial flow of US$ 50 billion between 2000 and 2008."

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