- What are Illicit Financial Flows?
According to the High Level Panel of the African Union and Economic Commission for Africa, Illicit Financial Flows are “money that is illegally earned, transferred or used”. A joint report by the African Development Bank (AfDB) and GFI, titled Illicit Financial Flows and the Problem of Net Resource Transfers from Africa: 1980 – 2009, puts the total illicit outflows from the continent at as much as $1.4 trillion for the 3 decades. For more information, click here.
- Why are Civil Society Organisations (CSOs) addressing IFFs?
Conservative estimates say Africa each year loses as much as $60 billion dollars through Illicit financial outflows. The movement of capital using illicit means goes a long way to undermine the continent’s ability to mobilize domestic resources to address pressing challenges of growing inequality, poverty, healthcare, education, infrastructure, and other vital development priorities. These levels of Illicit Financial Flows are particularly a cause for concern given the magnitude of developmental needs across the continent and the paradox of rising numbers of people living in poverty across continent despite the narrative on ‘Africa Rising’.
- What and who drives Illicit Financial Flows?
Corruption (e.g. bribery of state officials and theft of state assets) and outright criminal activity (e.g. drug trafficking and human trafficking) are important contributors to Illicit Financial Flows, estimated respectively at 5% and 30%. But, corporate commercial activity particularly stands out as the biggest culprit – accounting for as much as 65% of all illicit outflows.
The main mechanism through which corporates are bleeding the continent is through trade mis-invoicing – the practice of misrepresenting the price or quantity of imports or exports in order to hide or accumulate money in other jurisdictions. This way, companies, especially multinationals evade taxes, avoid customs duties, transfer kickbacks and launder money.
According to research from GFI, trade mis-invoicing accounted for 68.8% of all illicit outflows from Sub-Saharan Africa between 2003 and 2012. Estimates from the Economic Commission on Africa (ECA) also show that African countries lost up to $407 billion dollars from trade mis-pricing alone between 2001 and 2010. Read more…
- What is the “The Stop the Bleeding Campaign”?
The “Stop the Bleeding Campaign” is an African Campaign to curb Illicit Financial Flows (IFFs) from Africa. It is led and run by African civil society organisations. The campaign is rooted in African experiences, driven by African agency and reinforced by global Africa solidarity linkages.
- What does the campaign seek to achieve?
The main goal of the “The Stop the Bleeding Campaign” is to curb Illicit Financial Flows (IFFs) from Africa. The campaign broadens the conversation on illicit financial flows beyond specialist circles. It seeks also to mobilize ordinary people and grassroots social movements who are most affected by the problem in terms of lost economic benefits to be a key part of the voices for change.
- Why is it happening now?
At the 24th African Union Summit in Addis Ababa, which took place in January 2015, African leaders adopted the Report of the High Level Panel on Illicit Financial Flows from Africa. The findings of the report of this high level Panel, led by Thabo Mbeki, former President of South Africa, echoed the voices of civil society from across the continent in highlighting illicit financial flows as a serious threat to inclusive development in Africa and called for urgent practical policy action to stop the haemorrhage.
Since 2013, there has been a notable emergence of concerted advocacy efforts from various civil society based groups across the continent rallying against the issue of illicit movement of finances.
Today, illicit financial flows occupy a very important place in terms of advocacy actions for Africa’s development road map. For instance, Agenda 2063 and other on-going processes, such as the Financing for Development and the post 2015 Sustainable Development Agenda, have made it a priority to tackle illicit financial flows.
- Where is it taking place?
The campaign is an Africa-wide initiative and involves actors from across the continent.
- When does the campaign start and end?
The “Stop the Bleeding Campaign” was launched on June 25th, 2015 in Nairobi, Kenya.
But, given the historical and structural issues which make illicit financial flows and resource transfers in general a particular development problem for Africa, it follows that the quest for solutions to this problem in the African context must be anchored in distinct African demands deriving from the African specificities of this problem.
Thus, while embracing what works from the proposals put on the table so far by groups such as the OECD, let us not forget that these responses are largely based on a particular experience of the problem by Western and Global North economies. Therefore, the proposed solutions will not adequately respond to the specific ways that the challenge of illicit flows and their attendant root causes manifest in the African context.
A crucial task for African CSOs and partners in the “STOP THE BLEEDING” campaign consequently is to properly problematize illicit financial flows in the African context and develop distinctly African policy responses.
This entails civic and policy actions over the medium and long term, and means therefore that the campaign will be a period, within a given number of years, to mobilise attention and action for solutions over the medium and long term.
- Who are the players involved?
Every African needs to be involved in this campaign. The founding partners who are leading and running the campaign presently form a core group of civil society players and global solidary networks, including: the African Forum and Network on Debt and Development (AFRODAD), the African Women’s Development and Communication Network (FEMNET), the African Regional Organisation of the International Trade Union Confederation (ITUC–Africa), Tax Justice Network Africa (TJN-Africa), Third World Network Africa (TWN-Africa), and TrustAfrica.
- Who should be in the campaign?
Every African on the continent and all African diaspora communities are affected by illicit financial flows and their attendant challenges. Therefore, every African on the continent and those in diaspora should be involved in the “STOP THE BLEEDING” campaign and play a role in contributing to curb the illicit financial resource outflows from the continent.
- How do I join the campaign?
No matter who you are and where you are, you can be part of the actors and voices calling for change.
To begin, simply sign the “One Million Voices Petition” to make a big noise, so that those players that are directly or indirectly behind IFFs can hear the outcry from the people and take action to bring about positive change.
You can tell your friends, family, communities and constituencies about the campaign and urge them to sign the petition and to tell others about the campaign.
You can also share knowledge from our website and our other online resources that provide information on the campaign and the main and attendant issues it seeks to address.
If you have any other questions or queries, or require any further information on how to get involved, please contact:
|Nairobi:||Saviour Mwambwa on firstname.lastname@example.org
Kwesi Obeng on email@example.com
|Accra:||Gyekye Tanoh on firstname.lastname@example.org
Cornelius Adedze on email@example.com
|Dakar:||Briggs Bomba on firstname.lastname@example.org
Paul Takow Takow on email@example.com
|Harare:||Tafadzwa Chikumbu on firstname.lastname@example.org
Munyaradzi T. Nkomo on email@example.com