Addis Ababa — The extractive industries sector is central to the illicit outflows of money from Africa, noted the Head of the High-level Panel on Illicit Outflows of Money from Africa, South Africa's former President - Thabo Mbeki midway through his team's fact-finding mission to the Democratic Republic of Congo (DRC) today.
Mr Mbeki's delegation, which is technically supported by the United Nations Economic Commission for Africa (ECA), is in the DRC as part of a continent-wide and global campaign to help stop the huge amounts of money being illegally taken away from Africa - a phenomenon which is helping to delay the continent's socioeconomic transformation.
At the start of the three-day mission, Mr Mbeki and his team met with President Joseph Kabila, Prime Minister Augustin Matata Ponyo and eight other members of the Government of the DRC to discuss the nature of illicit outflows of money from the resource-rich country and learn what the State is doing about it. According Prime Minister Matata Ponyo, there is a direct link between conflict, the exploitation of mineral resources and the illegal transfer of capital from his country.
He noted that the Government of the DRC started efforts to fight the phenomenon of illegal money outflows in 2004 through the regulation of foreign currency exchange, the enactment of laws to reduce the practice while boosting transparency in banking transactions, as well as cooperation with international partners in view of returning illegally transferred capital to the country.
The ECA team manning the Panel's Secretariat has used the visit to explain the modus operandi of the Panel and to depict the faces of illicit monetary outflows.
These include: kickbacks and other forms of corruption involving civil servants; criminal activity such as drug and money trafficking and money laundering; as well as fraudulent commercial transactions such as tax evasion, the distortion of money transfer charges and over-billing (especially by transnational firms).
Mr Mbeki said his team would build on the experience gathered from all countries visited to recommend actions to be taken to halt the illegal transfer of money from Africa and to get illegally transferred funds repatriated to the continent.
The idea of setting up the HLP was hatched in Addis Ababa in March 2011 during the 4th Joint Annual Meeting of the Africa Union Conference of African Ministers of Economy and Finance and Economic Commission for Africa's Conference of African Ministers of Finance, Planning and Economic Development.
The two institutions were given the mandate to coordinate the mission of the Panel, which started full-fledged work on 5 February 2012.
The Panel's overall mission, which is to make clear recommendations on curbing illicit financial flows from Africa, is considered crucial given current estimates that the continent now loses at least 50 billion dollars yearly due to illicit financial flows - a figure that exceeds the Official Development Assistance (ODA) it receives.
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