Kenya has lost about Sh73bn in 10 years to criminals, tax evaders and the corrupt, according to a new study published by Global Financial Integrity. FILE
Kenya has lost about Sh73 billion in 10 years to criminals, tax evaders and the corrupt, a new study shows.
The study published by Global Financial Integrity (GFI), a Washington, DC-based research and advocacy organisation, was carried out between 2002 to 2011. In 2006, Kenya had no reported case of illicit financial outflows as well as between 2008 and 2011.
The study revealed that most of the activities took place in 2003, 2004, 2005 and 2007.
The study also revealed that crime, corruption, and tax evasion drained US$946.7 billion from developing countries in 2011, up more than 13.7 per cent from 2010—when illicit outflows totalled US$832.4 billion.
However, GFI chief economist Dev Kar, who served as a senior economist at the International Monetary Fund before joining GFI in January 2008, said that much of the proceeds of drug trafficking and human smuggling were not included in the estimates.
“It is extremely troubling to note just how fast this vice is growing,” stated Dr Kar. “This underscores the urgency with which policymakers should address the issue,” he added.
He said that what developing countries lost in that period is approximately 10 times the US$93.8 billion they receive in aid.
China leads pack
He said that poor countries haemorrhaged nearly a trillion dollars in 2011 that could have been invested in local businesses, healthcare, education, or infrastructure.
“This is nearly a trillion dollars that could have been used to help pull people out of poverty and save lives. Without concrete action, the drain on the developing world is only going to grow larger,” he said.
China was rated as the largest cumulative exporter of illegal capital, with outflows totalling $1.08 trillion over the decade.
This article was first published in the Saturday Nation.
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