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JOHANNESBURG, May 21 (Xinhua) -- Africa is loosing over 50 billion U.S. dollars each year through illicit financial outflows, the bulk of which are made
by multinational companies, former South African President Thabo Mbeki said on
Thursday.
In his address to the 6th session of the Pan African Parliament (PAP) in Midrand, Johannesburg, Mbeki said multinational companies were illegally moving
billion of dollars out of Africa, depriving the continent of the much needed
cash.
"It is estimated that over the last 50 years, Africa lost in excess of 1 trillion dollars in illicit financial outflows," he said.
"The figure of 50 billion U.S. dollars is therefore an underestimate as it excludes such elements as trade in services and intangibles, proceeds of bribery
and trafficking in drugs, people and firearms," said Mbeki.
Mbeki said it was wrong for such huge amounts to be illegally transferred out of the continent considering the immense developmental challenges that Africa is
facing.
He called on PAP to implement the 2011 recommendations of the High Panel of the African Ministers of Finance, Planning and Economic Development on steps to
be taken in stopping the illegal transfer of these funds by the multinational
companies.
He said, "Indeed in its Declaration on Illicit Financial Flows, the AU Assembly has expressed the need to ensure that Illicit Financial Flows and their
impact on domestic resources mobilization is given the necessary attention by
the 3rd International Conference on Financing for Development, and in this
regard, this stresses the need for robust international cooperation to address
the problem."
Mbeki said the illicit flows contributed a large percentage of the problems which Africa is facing today.
"The United Nations has estimated that the number of Africans living on less than 1.25 dollars a day increased from 290 million in 1990 to 414 million in
2010. In addition, per capita GDP in Africa is one fifth, that is, 20 percent of
the global average figure.
"The African Development Bank and others estimate that Africa needs an additional 30 to 50 billion U.S. dollars annually to address its infrastructure
needs," Mbeki said.
The former president called on Africa to do all within its power to ensure that the estimated 50 billion U.S. dollars being shipped out per year remains in
the continent to address the challenges of poverty and underdevelopment.
In its investigations, the High Panel found that 60 percent of the illicit flows are done by large commercial companies. It further found that criminal
activities such as drug trafficking accounted for about 30 percent, with
corruption contributing to the remaining 10 percent.
Mbeki said it was unfair for the international community to think that Africa can solve this problem on its own.
He said, "The outflows from Africa end up somewhere else in the world. The various tax havens and financial secrecy jurisdictions in Africa and elsewhere
in the world are at the center of the problem of illicit financial outflows
since they are among the major receiving countries for these
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