Illicit financial flows from Africa cost the continent roughly $555.6bn (N88.73trillion) annually over the past decade, Global Financial Integrity (GFI) has said.
The group said as African leaders converge on Washington this week for the historic US-Africa Leaders Summit, the Obama administration and Heads of State from across the continent should prioritize efforts to curtail illicit financial flows from Africa.
"Illicit financial outflows are by far the most damaging economic problem facing Africa," said GFI President Raymond Baker, who sits on the UN High Level Panel on Illicit Financial Flows from Africa, in a statement yesterday.
"In 2011 alone, $76.9bn flowed illegally out of Africa. That's nearly $77bn that could have been invested in local businesses, in healthcare, in education, or in infrastructure. It's money that could have been used to help pull people out of poverty and save lives. This Summit provides an historic opportunity for the United States and for leaders across Africa to focus their efforts on curtailing this haemorrhage of illicit capital."
GFI research finds that $555.8bn flowed illicitly out of Africa between 2002 and 2011, fuelling crime, corruption, and tax evasion, while simultaneously draining hundreds of billions of dollars from African economies.
The problem is so severe that a May 2013 joint report from GFI and the African Development Bank found that after adjusting all recorded flows of money to and from the continent (e.g. debt, investment, exports, imports, foreign aid, remittances, etc.) for illicit financial outflows, between 1980 and 2009, Africa was a net creditor to the rest of the world on the order of $597bn and $1.4tr.
"The traditional thinking has always been that the West is pouring money into Africa through foreign aid and other private sector flows, without receiving much in return. Our research has turned that logic upside down - Africa has been a net creditor to the rest of the world for decades," added Mr. Baker, a long time authority on financial crime.
GFI, highlighted the role of the United States as a major facilitator of such outflows.
"For every country losing money illicitly, there is another country absorbing it. Illicit financial outflows are facilitated by financial opacity in tax havens and in Western economies like the United States," noted Heather Lowe, GFI's legal counsel and director of government affairs.
"Indeed, the United States is the second easiest country in the world - after Kenya - for a criminal, kleptocrat, or terrorist to incorporate an anonymous company to launder their ill-gotten-gains with impunity. It's high time the U.S. Government comes to terms with this reality and lay out specific policies, which it intends to implement to curb its status as a dirty money haven."