By Humphrey P.B. Moshi | September 2014
The paper has three main objectives. First it identifies the kind of institutional frameworks at the global, regional and country level which have evolved to address the issues of illicit financial flows. Second, it analyzes the factors that have inhibited the efficiency and effectiveness of the frameworks. Third it proposes a way forward in terms of addressing the challenges with a view to achieve enhanced progress as far as the war against illicit financial flows is concerned. The main findings are: First, a variety of institutional frameworks has emerged at the three levels. However, they are interlinked and feed into each other, in the sense that those at the country level have been driven by those at the global and regional level. Given that most of these frameworks are not organic to Africa, the continent’s position has thus been more reactive than proactive. Second, the establishment of the institutional frameworks is an outcome of lobbying and advocacy organizations, spearheaded by non-governmental organizations and civil society organizations. This has been complemented by publications undertaken by a number of researchers in a variety of academic and non-academic institutions. All these efforts have underpinned the establishment of policy, legislative and enforcement frameworks at the country level. Third, the level of awareness, across a broad range of stakeholders, of the scope of the problem and its negative impact on African development, has been heightened. This notwithstanding, illicit financial flows continue to flourish unabated. A number of factors have contributed to this state of affairs. They include weak political will, lack of comprehensive legislation, weak enforcement capacities, continued existence of secrecy havens, corruption, and weak human and institutional capacities. Fourth, in order to adequately address the problem of illicit financial flows, solutions to the constraining factors must be sought, and the attendant measures effectively implemented. However, and most importantly, Africa needs to be proactive and own the process. The establishment of the High Level Panel at the Economic Commission for Africa (ECA) is a good starting point for spearheading efforts to combat illicit financial flows.