Dr Adeyemi Dipeolu, Special Adviser on Economic Matters to Vice President, Yemi Osinbajo, has called on African parliamentarians and other stakeholders to tackle the issue of illicit financial flows from the continent.
He made the call on Tuesday in Abuja at the opening of a workshop on the ‘Role of parliament in combating IFFs from Africa,’ organised by the African Development Bank.
Dipeolu said: “Legislators are very much needed in Africa to successfully tackle the issue of IFFs in Africa because you are representatives of the people and molders and shakers of public discourse.
“Even more important in this context, you are expected to pass the very laws that are needed to implement and domesticate the
recommendations of the High Level Panel as adopted by Heads of States and Governments.
“Our parliamentarians are not only required to pass domestic legislation on IFFs, but should also contribute to efforts to bring about the credible global architecture for tackling IFFs.
“And to encourage their colleagues, especially in developed countries and other jurisdictions that encourage financial secrecy, to do so to tackle IFFs particularly under the auspices of the inter-parliamentary union and other related forums.”
The three-day workshop aims to enlighten parliamentarians on the role they can play to translate the key recommendations of the High Level Panel report on IFFs into laws that respond to specific needs of their countries.
Dipeolu said extensive studies had shown that IFFs have had a negative impact on African economy in several ways.
He said it had reduced resources that were needed for development and have also contributed to undermining governance, exacerbating conflict, deepening inequality and weakening international government cooperation among other effects.
He said that IFFs had contributed to austerity with an attendant negative effect on growth.
To tackle it, he said, promoting transparency was essential, adding that more efforts were needed in asset recovery and repatriation as well as closer monitoring of commercial routes of IFFs.
He said: “The need for transparency is obvious because the main motive of the
perpetrators of IFFs is to hide wealth from tax authorities and law enforcement agencies, which is why information on beneficial ownership is very important.
“Similarly, abusive transfer pricing is a key route for IFF while the tracking and recovery of stolen assets continue to pose significant challenges.
“Resolving the problem of IFF requires political will and cooperation.’’
He said that the adoption of the HLP report and recommendation by means of a special declaration by African Heads of States and Government was a key first step in the implementation of the recommendation.
According to Dipeolu, the continent, ultimately, needs the collaboration of the continents that the diverted funds go to, adding that there have been efforts and conventions in that regard.
He, however, said that greater collaboration was needed to stop the creation of financial secrecy jurisdiction whereby people take money and go to hide them in other countries.
He also said that there was a will on the part of developed and developing countries to stop it.
He gave instances of what Nigeria had done to make financial
transparency easier.
He noted that the nation had gone very far with efforts to introduce a single window straight platform in all its ports of entry to help tackle the problem of trade mixed pricing.
He also listed the ease of doing business initiative, Voluntary Assets and Income Declaration Scheme, introduction of Biometric Verification Number, as some of the measures.
He also said there were ongoing efforts to recover stolen funds including the recent repatriation of 322.5 million dollars from Switzerland out of the Abacha loot.
Dipeolu commended the AfDB for convening the workshop which showed that it was committed to help African countries overcome developmental challenges.
Ebrima Faal, Senior Director, AfDB Nigeria Country Office, said current estimates suggest that Africa could be losing more than 50billion dollars annually to IFFs.
Faal said: “That number is similar to the total amount of Foreign Direct Investment coming to the continent and is also similar to the remittances that the continent receives from the Diaspora.
“(It) is actually higher than the total overseas development assistance that we receive from donors across the world.
“So it is not an insignificant number that we are losing.
“This estimate justifies how high they are but then they may be lower than the actual outlook as accurate data do not exist for all African countries and some discreet forms of IFFs are also excluded and therefore not easy to track let alone to estimate.’’
He said that the workshop was organised with three major objectives.
He said: “First we want to review the challenges and learn from group practices that have been adopted by experts in the fight against IFFs.
“We also want to share experiences in recovering the proceeds of crime from criminals and explore the role that parliamentarians can play in facilitating the work of the practitioners in this field.”
Faal said the workshop was very important because IFFs constitute a vast drain on the African continent.
He said this was because already, Africa was borrowing from other countries and donors and using taxes that could have been used to develop the continent to pay back.
He also said that there was ongoing collaboration with other continents and that they were already yielding results.
He said: “We are having some good tangible results seeing examples from Nigeria as some of the monies that were diverted are being returned and we are seeing the same pattern in other countries as well.
“This is because there is very good collaboration with the big commercial banks and the governments of European and American countries to stem this problem.’’
The workshop was designed for parliamentarians, judges, prosecutors and law enforcement institutions in Africa.
Participants at the workshop include parliamentarians from AfDB’s regional member countries, national and international experts and practitioners in the field of taxation, financial crimes and Financial Intelligence Units, among others.
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