From BUUMBA CHIMBULU in Yaounde, Cameroon
AFRICA’S Gross Domestic Product (GDP) can expand by more than 15 percent if countries on the continent put in place strict laws to curb Illicit Financial Flows (IFFs).
This is according to the Tax and International Financial Architecture (TIFA) Policy Lead, Robert Ssuuna.
Mr Ssuuna explained that in the absence of IFF, Africa’s capital stock and GDP would have expanded by more than 60 percent and 15 percent respectively.
He was speaking here during the 5th media training under the auspices of Tax Justice Network Africa.
It is estimated that Africa has over the last 50 years lost in excess of US$1 trillion in illicit financial flows.
“IFF undermines countries’ and regional trading systems as they as enabled by illegal and illicit activities, including: tax evasion, trade mis-invoicing, transfer pricing, money laundering, dodging customs duties/domestic levies, and corruption.
“IFF also take advantage of countries’ existing weaknesses and capacity gaps, including lack of adequate regulatory framework, as well as technical and human capacity,” Mr Ssuuna said.
IFF, he said, discouraged the structural transformation aspired to by the continent as well as transparency in governance.
Mr Ssuuna said that IFF also undermined the International Development Cooperation efforts.
“The Tax Justice Network, for example, estimates that between US$21 Trillion and US$32 trillion of private wealth is registered in offshore international financial centres.
“Global Financial Integrity estimates that IFF from Africa by other means total up to US$26.7 billion per year,” he said.
Mr Ssuuna added that uneven progress across countries showed that non-resource tax revenues are particularly low in oil-rich economies.