As Africa Loses $50 Billion Annually to Illicit Financing, Greater Global Cooperation Key for ‘Silencing the Guns’ Deputy Secretary-General Tells African Union Meeting

Following are UN Deputy Secretary-General Amina Mohammed’s remarks at the high‑level meeting on “African Union Silencing the Guns Initiative – The Role of Illicit Financial Flows in Fuelling Instability in Africa” today:

It is my pleasure to join you to discuss the need to silence the guns and stem illicit financial flows for the achievement of peace and stability in Africa.

I take the opportunity to celebrate the partnership between the United Nations and the African Union, which represents an exemplary model of cooperation.

The two organizations continue to strengthen their partnership in all areas of peace, security and development, including through advancing the implementation of the Joint Framework for Enhanced Partnership in Peace and Security and the Framework for the Implementation of Agenda 2063 and the 2030 Agenda for Sustainable Development.

The 2030 Agenda included a commitment to significantly reduce illicit financial and arms flows, strengthen the recovery and return of stolen assets and combat all forms of organized crime.  Similarly, the Addis Ababa Action Agenda underscored the importance of taking measures of combating corruption:  curbing illicit financial flows, eliminating safe havens and strengthening international cooperation and national institutions to tackle money‑laundering and the financing of terrorism.

It is critical to recognize the links among these threats.  Illicit financial flows and criminal activities feed off each other, further fuelling conflict and instability.  Illicit financial flows facilitate illicit flows of arms, particularly small arms and light weapons to non‑State actors, such as rebel armed groups, terrorists and criminals.  Curbing illicit financial flows will make it more difficult to illicitly acquire small weapons, thus contributing to silencing the guns.

Illicit financial flows are also draining the resources urgently needed to respond and recover better from the pandemic.  The Initiative on Financing for Development in the Era of COVID‑19 and Beyond, convened by the Secretary‑General and the Prime Ministers of Canada and Jamaica has been putting this challenge front and centre.  At a time when Africa is mobilizing efforts and resources to recover from the COVID‑19 pandemic and make progress across the economic, social and environmental pillars of sustainable development, it is imperative that the continent be allowed to tap into all its capacities and maximize its domestic resources.

At a time when Africa is trying to maximize domestic resource mobilization, it is losing $50 billion a year to illicit flows.  These staggering losses would be enough to fill 75 per cent of the continent’s health financing gap.  They are more than what would be needed to achieve Sustainable Development Goal 4 on inclusive education.  And they are one third of what Africa needs annually to fund infrastructure projects.

These flows pose a threat to stability and security in African countries, undermine institutions and democracy, and jeopardize sustainable development and the rule of law.  Women and girls are particularly exposed to criminal activities and conflicts driven by illicit financial flows as they are subject to trafficking and sexual violence which are used as weapons of war.

African countries have made important efforts to establish dedicated institutional frameworks for combating illegal financial flows in the main channels of trade, investment, financial systems and corruption.  Yet, trade mis‑invoicing, tax fraud, criminal activities and money‑laundering continue to thrive.

Political will to implement relevant measures, particularly to make personal costs greater than personal benefits, will be crucial.  Legal frameworks that clearly outlaw illicit activities and strong legal processes for investigating and prosecuting and punishing perpetrators are also a necessity.  African countries also need to build the capacity of relevant institutions with human resources, equipment and financial resources, including to target illicit financial flow perpetrators beyond national boundaries.  Political will is also needed to name and shame perpetrators and complicit actors, and to include credible deterrents and threats to their individual liberties.

This problem needs to be tackled at the source, in transit and at the destination.  It will require heightened global cooperation.  Silencing the guns and stopping illicit financial flows go hand in hand.  We must no longer allow the sinister effects of these flows compromise human development today and for generations to come.