President Edgar Lungu says Africa is losing about $150 billion in Illicit Financial Flows (IFFs) every year.
And President Lungu says despite efforts by countries to effectively combat illicit financial flows at national, regional and global levels, countries are failing to ensure timely recovery and return of stolen assets and proceeds to countries of origin.
Meanwhile, President Lungu acknowledged that Zambia had continued experiencing revenue losses through mechanisms, such as currency exchanges and undervaluing of assets, among others.
According to a statement issued by First Secretary for Press at the Zambian Permanent Mission to the United Nations Wallen Simwaka, President Lungu said this at the ongoing United Nations General Assembly (UNGA), Thursday.
He said Africa was losing between US$50 and US$150 billion annually through IFFs, adding that the continent would continue to lose immense proportions of its finances meant for economic development if the scourge was not stopped.
“Illicit Financial Flows undermines sustainable development and economic growth, and human rights. It would be unrealistic for the international community to expect progress to particularly harness the needed resources to finance sustainable development when, for instance, immense proportions of finance estimates ranging from $50-$150 billion, are lost annually in Africa alone through the scourge of IFFs,” President Lungu said.
The Head of State stressed the need for countries to harmonize their legal and institutional framework in order to prevent economic bleeding of developing or under-developing African countries.
He said IFFs had negative impacts on economies as they often reduced both domestic resource and tax revenue.
President Lungu said Zambia had continued experiencing revenue losses through mechanisms, such as structuring, currency exchanges, undervaluing of assets, front businesses, false currency reporting and offshore corporations.
He further highlighted some of the major impediments, which some African countries were facing in combating IFFs.
“At the international level, we recognize that there is lack of common standards for the definition of illicit financial flows, an internationally agreed methodology to estimate these flows, the lack of cooperation by recipients of illicit financial flows. [The] conflict between national and foreign interests and the disparity in rates between the tax regimes have continued to undermine efforts towards combating illicit financial flows,” said President Lungu.