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Africa Loses at Least $50 Bln Annually Through Illicit Financial Flows

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Tax Justice Network Africa civil society group has revealed that African companies and government officials transfer at least $50 billion out of Africa illegally each year.

MOSCOW, February 2 (Sputnik) – African companies and government officials transfer at least $50 billion out of Africa illegally each year, the Tax Justice Network Africa has revealed citing a joint United Nations and African Union panel report. The group promotes "socially just, democratic, accountable and progressive taxation systems in Africa," according to its Facebook page.

"This is an extraordinarily important report which could shift the global debate on tax, financial transparency and corruption," Joseph Stead, Senior Economic Justice Adviser at Christian Aid, a London-based charity organization, said Sunday as quoted by the Tax Justice Network Africa.

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The 10-member High-Level Panel on Illicit Financial Flows from Africa, led by former South African President Thabo Mbeki, said in its Sunday report that African countries need to take specific measures in order to stop the outflow of money, which comes from many areas, including the oil sector.

According to the report, Africa is losing the money through crimes such as tax dodging and corruption and the amount of illicit financial flows is expected to go up unless preventive measures are adopted.

"The Mbeki report removes any excuse for not taking immediate and effective action against the multinationals draining billions from developing countries, the shell companies holding looted money and the financial secrecy which protects everyone with dirty money to hide," Stead said.

According to the justice adviser, Christian Aid is certain that solutions to the problem of illegal money outflow from Africa "lie in reforms including public country-by-country reporting for multinationals, public registers of the real owners of companies and a new system of automatic sharing of financial information between governments".

Africa lost in excess of $50 billion annually between 2000 and 2008, according to the UN Economic Commission for Africa. The level of illicit financial outflows from Africa exceeds the official development assistance to the continent, which, according to the commission, stood at $46.1 billion in 2012.

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