Not a new story, but a good overview about the problem with more-or-less legal capital outflows from Africa:
Africa loses at least $50 billion a year — and probably much, much more than that — perfectly lawfully. About 60% of this loss is from aggressive tax avoidance by multinational corporations, which organise their accounts so that they make their profits in tax havens, where they pay little or no tax. Much of the remainder is from organised crime with a smaller amount from corruption. This was the headline finding of the High Level Panel on Illicit Financial Flows from Africa, headed by former South African President Thabo Mbeki, a year ago.
This amount is the same or smaller than international development assistance ($52 billion per year) or remittances ($62 billion). If we take the accumulated stock of these illicit financial flows since 1970 and factor in the returns on this capital, Africa has provided the rest of the world with $1.7 trillion, at a conservative estimate. Africa is a capital exporter.
While this type of aggressive tax avoidance might be legal, strictly speaking, it really highlights the question of power. Off shore tax havens are simply not accessible for “normal” tax payers. They only make sense as an instrument for the rich, super rich and international corporations. The system is rigged in a very fundamental way to the detriment of poor people and countries with low institutional capacity (for whatever reason) to combat these illicit financial flows. Of both categories, Africa unfortunately has more than enough, putting the continent as a whole at a severe disadvantage on a global scale.