The Tax Justice Network Africa (TJNA) has warned of increased illicit financial flows from Kenya and Africa to other countries in the wake of the Covid-19 pandemic.
The tax justice lobby group yesterday revealed that with the onslaught of the global coronavirus pandemic, there are concerns that the scale and scope of illicit financial flows (IFFs) facilitated by unscrupulous government officials and other non-state actors could be increasing.
“While authorities focus on the pandemic, other actors should not be distracted. For African countries to stand on their feet economically and finance their own development, they need to seal the loopholes facilitating outflow of resources, at the same time encourage creative and innovative ways to finance the development agenda,” said Alvin Mosioma, the Executive Director TJNA.
Mosioma, through a statement sent to newsrooms, pointed out that Africa is endowed with significant natural resource wealth and with good husbandry could finance its own development. He observed that there however exist illegal cross border movement of money and capital that threatens Kenya’s and the continent’s sustainable development and have been growing every year.
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“It is the role of the civil society to advocate for increased transparency around public revenues and expenditures. The media should also invest in improving their skills for in-depth investigations and expose abuses for action to be taken,” he added.
The executive director also said that despite having achieved independence well over fifty years ago, the global financial and tax systems are rigged against the interest of African countries.
This, he said, has severely affected the sovereignty of African nations by undermining domestic revenue mobilisation in Africa that is required for public spending and investment, forcing many governments to borrow and rely on overseas development assistance.
“Trade unions should take advantage of their regional presence and explore possibilities of collaborating with non-state actors to combat IFFs in Africa,” said Mosioma.
Rachel Etter-Phoya of Tax Justice Network said that Africa is home to the world’s largest arable landmass; second largest and longest rivers and its second-largest tropical forest. According to a study by the African Development Bank Group, the total value added of its fisheries and aquaculture sector alone is estimated at USD 24 billion (Sh2.4Trn).
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“These flows out of the continent and associated revenue losses dwarf finance that flows inward in the form of overseas development assistance, remittances and loans,” she said.