Honest Accounts 2017 – How the world profits from Africa’s wealth
Date: 24 May 2017
Much more wealth is leaving the world’s most impoverished continent than is entering it, according to new research into total financial flows into and out of Africa. The study finds that African countries receive $161.6 billion in resources such as loans, remittances and aid each year, but lose $203 billion through factors including tax avoidance, debt payments and resource extraction, creating an annual net financial deficit of over $40 billion.
The research shows that according to the most recent figures available in 2015:
- African countries received around $19 billion in aid but over three times that much ($68 billion) was taken out in capital flight, mainly by multinational companies deliberately misreporting the value of their imports or exports to recuse tax.
- African governments received $32.8 billion in loans but paid $18 billion in debt interest and principal payments, with the overall level of debt rising rapidly.
- An estimated $29 billion a year was stolen from Africa in illegal logging, fishing and the trade in wildlife and plants.
NB. This report was updated on 17 July 2017 to make the figures for illicit financial flows clearer.