Monday 2 February 2015

Multinationals Still Bleeding Africa Dry

The recently released African Union report into illicit financial flows claims that between 1970 and 2008 $850b has been siphoned out of the continent through illegal payments and tax avoidance schemes by multinationals. $20b has been lost since 2008. This one of damaging legacies of colonialism exacerbated by a culture of local corruption that has gone unchecked. It is easy to see why there is so much underdevelopment in the continent. It is no surprise that current campaign pledges to curb corruption being made in the lead up to next week's elections in Nigeria do not include any specifics on what fraudulent practices and how they will be tackled. That is no surprise since both presidential candidates are probably implicated in the tolerance of this bleeding of resources. Unfortunately, even if the problem of illicit flows by multinationals is addressed it doesn't stop rampant financial fraud and misappropriation that have become the norm across the continent. 
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2 comments:

  1. Unknown3 February 2015 at 02:26

    Uhhhh Papi...Tibs la confused here mehn.....Erhmmm....just so I understand what you are saying here eh....we have money missing right?....that people are aware of right?....and nobody is doing anything bout recovering it right?......so to my understanding, if there is a problem and people know it is problem and are not willing to do anything to solve it.....then it can't be seen as a problem really...it kinda looks like a norm to me Papi.....then again, I am not really sure I understood this post....**whispering** I asked my husband to explain the post to me and he said, ' Cyclone says money is lost buh he doesn't mean lost lost per say'....hehe...I think he is more confused than I am...

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    1. Cyclone3 February 2015 at 07:22

      Multinationals make a huge amount of money but very often use accounting schemes to hide it or declare a loss thereby avoiding paying tax. This results in a huge loss of income to the local country. If the multinational declares a loss it might end up getting a tax rebate in addition to any commercial waivers already in effect. So in essence instead of paying tax the multinationals are actually getting paid public money to deprive the state of public income.

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