Over the past decade, developing countries lost $6 trillion
American Organization of Global Financial Integrity (GFI), which deals with financial and political research, published a report "illegal financial flows out of developing countries, between 2002 to 2011". The paper reported that the illegal activities in developing countries devastated the state treasury 150 countries by $ 946 billion during 2011 alone. This figure is 13% higher than in 2010. And in the period from 2002 to 2011 the budget of countries with developing economies, suffered $ 6 trillion.
Raymond Baker, president of GFI, said that crime in developing countries is gaining momentum amid the global financial crisis. Unfold illegal organizations, businesses avoid paying taxes, criminals launder money, while financial institutions from around the world are fighting for stimulating economic growth.
Experts specify that the study is based on information on trade relations between different countries. That report does not take into account the circulation of cash, illicit trafficking in drugs and human beings, which provides cash.
Project's Lead Economist, Dev Kar, drew attention to the fact that the illegal outflow of the year increased by 10% and well ahead of GDP growth. This demonstrates the relevance of and need for its regulation.
According to the information provided in the report, the leaders of illegal financial flows were China, Russia, Mexico, Malaysia and India. So, over the last decade, these countries lost the following amounts:
China - $ 1.08 trillion.,
Russia - $ 880.9 billion
Mexico - $ 461.9 billion
Malaysia - $ 370.4 billion
India - $ 343 billion
Next in the list are Saudi Arabia, Brazil, Indonesia, Iraq, Nigeria, Thailand, UAE, South Africa, the Philippines and others. Ukraine occupies position 72 on the list with $ 6.2 billion of illegally derived funds. Belarus is in 16th place with $ 75 billion.
Global Financial Integrity calls on world leaders to implement reforms to increase transparency in the international financial system. Thus, the organization offers several solutions to the problem. First, you must fight with anonymous front companies, foundations and trusts. Information about all of it should be accessible to employees of law enforcement. Secondly, it is necessary to reform customs and trade protocols so as to avoid erroneous pricing. In addition, countries are required to submit reports on sales, profits and taxes paid by multinational companies. It is also necessary to introduce an automated system for tax reporting for enterprises and individuals.
