African governments are deeply concerned with the continued scale of illicit financial flows out of the continent.
Experts say that illicit financial flows (IFFs) from Africa has doubled to $100 billion annually.
The UN estimates that between $1.2 trillion and 1.4 trillion left Africa in illicit financial flows between 1980 and 2009 alone. This is roughly 63 per cent of Africa's gross domestic product (GDP), and surpasses the money it received from outside over the same period.
The IFFs far exceed what the continent receives in aid and the fact that most are not aware of this gives a false impression that the world continues to be altruistic towards Africa when, it can be rightly be argued, Africa is financing the world.
Not only do African governments view the scale of IFF as morally abhorrent, their concern has a level of pragmatism during a time when many governments seek increased investments into their nations.
In order to build infrastructure, stimulate private sector and economic growth, African governments consider these flows to be robbing them of funds that are rightfully theirs, pushing them to enter debt agreements that could have been financed if IFFs were stemmed.
However, it is clear when you examine the perception of the public on this issue that they do not seem to be as concerned about IFFs as their governments are.
This is due to several reasons, the first of which is that some African-owned companies benefit from the loopholes that allow IFF to continue unabated.
Through transfer pricing many African companies are able to retain more of their profits. And it’s doubtful they view this as immoral but practical business sense that keeps costs down. One is, therefore, unlikely to see a strong African private sector push to address IFFs.
Secondly, IFFs feature nowhere near the top of the list of priorities for Africans as most are concerned with basics such as access to clean water, health services, educational facilities and adequate nutrition. It will likely be a long time before African masses begin to picket fence about IFF.
Finally, one will likely not see any great pressure put on foreign nations by African populations concerning IFFs because they generally do not view their own governments as responsible custodians of public wealth.
Why should the African public put their weight behind their governments in insisting on an end to IFFs when those governments are not financially accountable to them?
Until the continent stems fiscal indiscipline and mismanagement, the IFFs will be viewed as a difficulty the African governments can grapple with on their own.
Indeed, one can argue that the injustice of the IFFs in the minds of African governments, mirrors the injustice felt by their people when public funds are embezzled.
As the continent starves its people of funds that are rightfully owed to the public, the IFFs can continue to starve African governments of funds they view as rightfully theirs.
In short, African governments ought to clean up their act and demonstrate that they can responsibly manage public funds if they ever hope to get the African public to amplify their push to end the IFFs.
Ms Were is a development economist. Email: [email protected]