President of the African Development Bank (AfDB), Dr Akinwumi Adesina, has said that if African leaders are to deal with a debt pile that is approaching $2 trillion, they must end corruption and illicit capital flows that cost the continent more than $580 billion yearly.
Adesina, in an interview with Bloomberg in Maputo, Mozambique’s capital, maintained that while nations also need access to more concessional financing and debt-restructuring where necessary, curbing outflows is crucial.
The continent, yearly, loses money through illegal channels such as tax evasion, trade misinvoicing, corruption, smuggling, and money laundering.
According to him, these outflows drain resources that could otherwise fund infrastructure, education, health, and job creation.
“It doesn’t matter how much water you pour into a bucket if the bucket is leaking,” he said during the interview. “If you’re able to reduce the leakages to illicit capital, also corruption and all of these things, Africa will be able to keep a lot of these resources and meet the amount of infrastructure it needs,” Adesina added.
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The AfDB estimated in May that Africa lost about $1.6 billion daily to what it termed “financial leakages.” That figure included the loss of $90 billion a year to illicit financial flows, with $275 billion “siphoned away” by multinational corporations shifting profits, and $148 billion going astray because of corruption.
The continent faces an annual infrastructure backlog of as much as $170 billion, which will be critical to address for economic development and job creation, the Bloomberg report said.
