Windhoek

The failure of African states to prevent the outflow of capital and tax evasion costs the continent N$500 billion annually, former South African statesman Thabo Mbeki told African lawmakers at the recent Pan African Parliament (PAP).

Mbeki, who serves as the chairperson of the African Union’s panel on illicit financial flows, made the revelation in a report presented to the Pan African Parliament that was compiled by the panel.

Multinational corporations are prime suspects and illegal drug trafficking accounts for about 30 percent of the money.

Mbeki said the figure is an underestimate as it excludes elements such as trading services and intangibles, bribery, trafficking drugs, firearms and people.

“These outflows are of serious concern, given inadequate growth, high levels of poverty, resource needs and the changing global landscape of developmental assistance,” noted Mbeki.

“You know that many of our African countries did not achieve all these MDGs because of insufficient capital to finance the required actions,” said Mbeki.He also said the amount of money leaving the continent every year is estimated to be enough to finance the African Development Bank’s infrastructure requirements.

Mbeki also said that most African countries lacked capacity, legislation and guidelines to fight the outflows.

“Our countries do not have accountants, lawyers and tax experts to punish those who practise this. The few who are available are unable to sufficiently take on the top class professionals,” he said.

Namibian delegates’ perspectives

The Namibian delegation, led by National Assembly Chief Whip Evelyn Nawases-Tayele also made their contribution when the report was debated.

The group consisting of Nawases-Tayele, National Assembly Deputy Speaker Loide Kasingo, McHenry Venaani, Laura Mcleod-Katjirua and Bernard Sibalatani yesterday convened a press conference to report on the outcome of the recently concluded Sixth Session of the 3rd Pan African Parliament.

Venaani concurred with Mbeki that in-house capacity is one of the major stumbling blocks when it comes to curbing illicit financial outflows.

“Africa lacks tax expertise that can curb issues such as transfer pricing – the countries with expertise must help others. Many experts live in the diaspora because we have a brain drain,” said Venaani.

Venaani said there is a need for Africa to devise strategies to lure African experts living in the diaspora to return in order to help develop the continent.

Mcleod-Katjirua touched on the issues of medical aid and African Union diplomatic passports accorded to PAP members. The issue has been debated for years with lawmakers, especially those from west Africa, complaining that they have difficulties travelling to South Africa.

“The issue of passports has been resolved but we [Namibian delegation] could not get our passports because we applied late. It is important that PAP members receive the passports because some MPs have difficulties travelling from their countries to South Africa,” she said.

With regard to legislation to control illicit financial flows from the country, Nawases-Tayele said: “There is already a high-level panel dealing with reports from the Pan African Parliament to consult with the relevant ministers in order to chart the way forward. We will decide as a parliament whether there is a need for a new legislature.” As for medical aid, Nawases-Tayele said the Pan African Parliament deemed it necessary to look after its members by ensuring that there is medical treatment available when they are abroad.The Namibian delegation already receives medical aid from parliament to the tune of N$55 800 per year.

Election of new bureau members

The delegation also reported that the term of the third bureau of the PAP ended towards the end of last month, hence new bureau members were elected.

Roger Nkodo from Cameroon who is representing the central African region was elected as president, first vice-president will be Eduardo Mulembwe from SADC, second vice-president is Dr Ashebir Gayo from Ethiopia representing east Africa, third vice-president Suilma El Kaid from Sahrawi representing the north African region and Bernadette Lahai from Sierra Leone will represent west Africa.

The battle for the clerk position has finally been put to bed after long serving PAP purse manager Zwelethu Madasa maintained his position.