African Strategies to Combat Illicit Financial Flows

To safeguard its financial resources, the continent needs a cohesive strategy for promoting international tax cooperation.
Global tax cooperation and the fight against illicit financial flows (IFFs) have become crucial in international economic governance, especially for African countries. As the global economy becomes more interconnected, base erosion and profit-shifting (BEPS) practices by multinational enterprises (MNEs) have intensified, leading to significant tax revenue losses. Africa’s annual losses due to IFFs total around $88.6 billion, representing 3.7 percent of its GDP, a severe leak in its economic bucket that exacerbates inequality and stifles growth. This leakage also threatens achievement of the objectives outlined in Africa’s Agenda 2063, the African Union (AU)’s blueprint for continent-wide economic prosperity, as well as the UN Sustainable Development Goals (SDGs). From 1980 to 2018, sub-Saharan Africa lost a staggering $1.3 trillion to these flows, highlighting the scale and persistence of the problem.








