Dirty money from crime, corruption and tax evasion costs developing world $6 tn, led by China, India: report

Crime, corruption and tax evasion have cost the developing world nearly $6 trillion over the past decade, and illicit funds keep growing, led by China, a financial watchdog group said in a new report.

China accounted for almost half of the $858.8 billion in dirty money that flowed into tax havens and Western banks in 2010, more than eight times the amounts for runner-ups Malaysia and Mexico.

Total illicit outflows increased by 11 percent from the prior year, Global Financial Integrity, a Washington-based group that campaigns for financial accountability, said in its latest report released on Monday.

"Astronomical sums of dirty money continue to flow out of the developing world and into offshore tax havens and developed country banks," said Raymond Baker, director of GFI.

"Developing countries are hemorrhaging more and more money at a time when rich and poor nations alike are struggling to spur economic growth.

This report should be a wake-up call to world leaders that more must be done to address these harmful outflows," he said.

All the countries in the top 10, which this year saw India, Nigeria, the Philippines and Nigeria join the ranks, face significant problems with corruption, and in most there are vast gaps between rich and poor citizens as well as internal security problems.

Leaders of the Group of 20 major economies increasingly are focusing on ways to crack down on money laundering, bank secrecy and tax loopholes to prevent funds stolen from public coffers or earned through criminal activity from depleting the budgets of developing countries.

The sums are so huge that for every dollar in foreign direct aid, $10 leaves developing countries.

China lost $420.4 billion in 2010 and over the decade lost a total of $2.74 trillion.

And its losses are steadily rising.

In an October report, GFI said another $602 billion in illicit flows left China in 2011 for a total of $3.

... contd.

Please read our terms of use before posting comments
TERMS OF USE: The views, opinions and comments posted are your, and are not endorsed by this website. You shall be solely responsible for the comment posted here. The website reserves the right to delete, reject, or otherwise remove any views, opinions and comments posted or part thereof. You shall ensure that the comment is not inflammatory, abusive, derogatory, defamatory &/or obscene, or contain pornographic matter and/or does not constitute hate mail, or violate privacy of any person (s) or breach confidentiality or otherwise is illegal, immoral or contrary to public policy. Nor should it contain anything infringing copyright &/or intellectual property rights of any person(s).
comments powered by Disqus