Transparency International has identified key factors that make African countries susceptible to illicit financial outflows linked to corruption. Congo, Côte d’Ivoire, Ethiopia, Kenya, Mauritius, Morocco, Nigeria, South Africa and Zambia are all at risk.
Illicit financial flows (IFFs) are flows of funds across borders which originate from illicit activities, are transferred through illicit transactions or which stem from a licit activity but are used in an illicit manner.1 IFFs are hugely detrimental to Africa’s potential to achieve the Sustainable Development Goals as they cause a major drain on capital and revenues, undermine just fiscal systems and reduce resources available to governments to provide key public services. Given the inherent challenges in calculating the volume of IFFs, especially those emanating from corruption, this report aims to identify some of the key risk factors which make African countries vulnerable to outflows of IFFs. It focuses on nine countries: the Republic of the Congo (Congo), Côte d’Ivoire, Ethiopia, Kenya, Mauritius, Morocco, Nigeria, South Africa and Zambia. They were selected with consideration for economic aspects such as reliance on economic sectors known to be linked to high levels of IFFs (e.g., extractives and state-owned enterprises) or a country’s potential attractiveness as a transit or final destination for IFFs. This report explores what is known about the types, sources and destinations of IFFs in these countries, and identifies some of the governance and structural drivers which exacerbate the risks of IFFs. It also explores efforts to combat IFFs in the
target countries, focusing on key elements of the anti-money laundering (AML) regime. The report focuses on IFFs resulting from corruption, although findings may apply to some extent to other areas –such as IFFs related to tax and commercial activities, criminal activity or illegal markets.
