African Development Bank has stated that illegal money flows and profit shifting by multinational corporations doing business in Africa cost the continent over $1.6 billion per day.
In an interview with The PUNCH, Kevin Urama, the AfDB’s Chief Economist, revealed this.
The International Monetary Fund defines illicit financial flows as cross-border money transfers that are unlawful in their source (such as smuggling or corruption), transfer (such as tax evasion), or use (such as financing terrorism).
The IMF has been a major player in global initiatives to stop these ambiguous and frequently destabilizing transfers for many years. Additionally, it has long been concerned about flows that are linked to tax avoidance but are not necessarily criminal.
According to Urama, stakeholders should concentrate on preventing the outflow rather than pursuing inflows because Africa was losing more foreign direct investment than it was gaining.
He said,
Urama highlighted a number of strategies to stop the outflow, including the quality of institutions, accountability mechanisms for institutions, and the ability of public servants and government officials to not only comprehend the consequences of their actions but also to have the resources, rules, policies, and technology necessary to identify and stop it.
TimesNow.com.ng reported that the Central Bank of Nigeria (CBN) has issued a warning regarding potential repercussions for financial institutions involved in the illegal sale of dollars or unauthorised forex transactions.
The warning follows the unfortunate decline of the Nigerian currency, the naira, against the dollar at official and unofficial markets.
Folashodun Shonubi, the acting Governor of the CBN, conveyed this message while delivering a lecture titled “Diaspora Remittances and Nigerian Economic Development” in Abuja.
Source: TimesNow.com.ng
