Illicit financial flows (IFFs) continue to be a pressing concern as they undermine economic growth, advance inequality, and hinder the development prospects of African nations. Africa loses billions of dollars annually due to activities such as tax evasion, money laundering, and corruption. These illicit flows deprive governments of much-needed revenue that could otherwise be invested in essential public services such as healthcare, education, and infrastructure.
TJNA recognises the urgency of addressing this issue to ensure sustainable development across Africa.
In Africa, when the report of the High-Level Panel on Illicit Financial Flows from Africa that was chaired by His Excellency Thabo Mbeki was released, it was estimated that Africa was losing $50 billion annually, on the back of the over one trillion dollars that the continent had been lost in the three decades prior.
One of the primary challenges in combating illicit financial flows in Africa is the lack of transparency and accountability within financial systems. Weak regulatory frameworks and loopholes in tax laws make it easier for individuals and corporations to engage in illicit activities without fear of detection or punishment.
The report of the High-Level Panel on Illicit Financial Flows from Africa further indicates that commercial activities account for 65 per cent of the losses, criminal activities account for 30 per cent of the losses and corruption accounts for 5 per cent of the losses.
TJNA emphasises the importance of building the capacity of African governments and civil society organisations to effectively tackle illicit financial flows. This includes improving tax administration, enhancing financial intelligence capabilities, and promoting greater public awareness of the detrimental impacts of IFFs. Additionally, TJNA calls for increased collaboration between governments, regional bodies, and international stakeholders to share information, coordinate investigations, and enforce anti-corruption measures.
By empowering African countries to effectively combat illicit financial flows, Africa will see an increase in economic transparency and accountability across the continent.
