Former South African President, Thabo Mbeki, says an estimated 50 billion dollars is smuggled from Africa illegally every year.
Mbeki made the statement in Johannesburg at the inauguration of a U.N. Economic Commission for Africa (UNECA) investigative panel, saying such money could be used to develop the continent.
UNECA constituted the panel, chaired by Mbeki, to investigate illegal financial flow out of the continent.
Mbeki said the loss should be addressed before it undermined Africa’s development.
“Almost 25 billion dollars comes into the continent; that means it loses twice the capital it receives in financial assistance.
“The panel will study the flow of money and understand how it is done.
“The African continent will expect the panel to provide practical measures to stop the flow,” Mbeki said, stressing that it would take a year for the panel to complete its work.
“This is a matter of importance to the continent. In the end the investigation should result in action taken by the continent and individual countries.
“As a panel, we have no punitive measures. The panel will make proposals to those with punitive power and explain how the flow of money is done,” Mbeki said.
He said the panel would provide sufficient information about the different methods of the outflow. “These are over-invoicing and under-pricing of exports and money laundering strategies,” Mbeki said.