{"id":391,"date":"2021-04-01T15:35:00","date_gmt":"2021-04-01T12:35:00","guid":{"rendered":"https:\/\/qiraatafrican.com\/journal\/?post_type=article&p=391"},"modified":"2026-10-13T13:38:26","modified_gmt":"2026-10-13T10:38:26","slug":"economic-impact-of-corruption-in-sub-saharan-africa-illicit-capital-flows-case-study","status":"publish","type":"article","link":"https:\/\/qiraatafrican.com\/journal\/article\/economic-impact-of-corruption-in-sub-saharan-africa-illicit-capital-flows-case-study","title":{"rendered":"Economic impact of corruption in sub-Saharan Africa; Illicit Capital Flows – Case Study"},"content":{"rendered":"\n
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Publisher: <\/strong>Qira’at Afriqiyah Magazine
Issue:<\/strong> 48, April 2021
ISSN<\/strong>: 2634-131X
Year :<\/strong> 17
Pages: <\/strong>62-77
Author<\/strong>: Dr. Magdy Mohamed Mahmoud Adam
Download pdf<\/a><\/p>\n\n\n\n

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<\/a>Abstract:<\/span><\/strong>
<\/bdo>\nThere is no doubt that corruption is an immoral and criminal phenomenon of many forms. It has negative effects on various walks of life, and illicit financial flows are one of its forms. Those flows may be a part of an illegal act, the product of illegal works, or used for an illegal purpose, adversely affecting economic development in several aspects. They arise in settings affected by conflict, lack of democracy and good governance, and the absence of regulatory institutions.\n\nAlthough estimates of illicit financial flows in Africa differ, at the lowest point they exceed tens of billions of dollars annually. According to some estimates, they roughly equal the volume of foreign aid and investment flowing into the continent. Their most prominent determinants are debt, political risks, corruption, conflicts, fraudulent billing, profit shifting, and trafficking in humans, drugs, and weapons. Illegal practices in the business operations of multinational companies are responsible for more than half of those flows, followed by criminal activities, and then bribery and embezzlement.\n\nThese illegal flows in the African continent represent an annual increase higher than the global average, with a high degree of stability; they increase in resource-rich countries affected by conflict, concentrating in the West, North, and South regions respectively, with an increasing outflow abroad from the interior.\n\nTheir behavior was also contrary to the expectations of economic theory, as there was a positive relationship between the increase in economic growth rates in the African continent over the last two decades and the growth rates of illicit financial flows. The loss of additional growth rates for African countries could have been avoided had these funds been invested locally; they would have been sufficient to fund the first ten-year plan of Agenda 2063. Illicit financial flows have thus exacerbated the financial deficit across the continent.\n\nMost African countries have failed to fight corruption\u2014especially these illicit financial flows, which reached their peak in the second decade of the twenty-first century\u2014despite the fact that most countries on the African continent declared war on it, with several African nations ranking poorly on the Corruption Perceptions Index according to recent reports. This failure is due to weak or absent organizational structures, lack of funding, low technical capabilities, poor regional coordination, and the involvement of senior officials and multinational corporations.\n<\/span><\/pre>","protected":false},"excerpt":{"rendered":"
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