A new report from Global Financial Integrity (GFI) estimates that Africa lost $854 billion to $1.8 trillion in illicit financial outflows between 1970 and 2008. The estimated outflows grew at an average rate of 11.9% per year and were approximately double the level of international aid to Africa over that period. According to GFI director Raymond Baker "staunching this devastating outflow of much-needed capital is essential to achieving economic development and poverty alleviation goals in these countries."
Of the estimated outflows, it is believed that at least 3 percent ($25 billion) can be attributed to the proceeds of bribery and theft by corrupt government officials; at least 30 to 35 percent to criminal activities such as drug trafficking, racketeering and counterfeiting; and the final 60 to 65 percent to the proceeds of commercial tax evasion.
Sub-Saharan African countries experienced the bulk of illicit financial outflows. However, the top five countries with the highest measurable outflows were detailed as:
- Nigeria ($89.5 billion);
- Egypt ($70.5 billion);
- Algeria ($25.7 billion);
- Morocco ($25 billion); and
- South Africa ($24.9 billion).
What is clear is that as long as these countries continue to experience significant illicit financial outflows, economic development and prosperity remain elusive. Addressing this problem will require a concerted effort globally.