Former President Thabo Mbeki says a vast amount money is taken out of Africa by companies and wealthy individuals, without paying tax.
The politician, who been tasked by the African Union to identify illicit financial outflows, says he’s convinced these exceed the $80 billion a year estimated by the International Monetary Fund.
The International Monetary Fund says the amount of money leaving the African continent illegally every year has risen from $50 billion to $80 billion.
Former South African President Thabo Mbeki says this is an underestimate because it’s based on trade statistics. He puts the figure at $90 billion a year
The IMF figure may reflect, there’s more thorough work being done, or it may reflect as an increase. It is based on the trade statistics.
If, for example, transfer pricing was taken into account, the figure would go up.
Mbeki says the commercial sector is responsible for two thirds of illicit capital outflows.
Mbeki recently returned from a world tour formulating the illegal financial stream for the African Union.
He met with world governments, banks and parliaments.
Mbeki says the tour was aimed at ensuring practical steps are being taken to stop the phenomenon and recover the money.