News24

Mbeki: Africa is losing billions

2012-02-19 13:19

Johannesburg - An estimated $50bn is exported out of the African continent illegally every year, former president Thabo Mbeki said on Saturday. "This money is exported illegally instead of being invested in the continent," he said.

Mbeki was speaking at the launch of a United Nations Economic Commission for Africa (UNECA) high level panel in Johannesburg.

The panel, chaired by Mbeki, would investigate illicit and financial flows of finance out of the continent.

Mbeki said the loss needed to be addressed before it undermined the prospect of Africa's development.

"Almost $25bn comes in to the continent. That means it loses twice the capital it receives in financial assistance," he said.

Practical measures

"The panel will study the flow of money and understand how it is done. The African continent will expect the panel to provide practical measures to stop the flow."

He said it would take a year for the panel to complete its investigation.

"This is a matter of vital importance to the continent. In the end [the investigation] should result in action taken by the continent and individual countries," he said.

"As a panel we have no punitive measures. The panel will make proposals to those with punitive power and explain how it [the flow of money] is done."

He said the panel would provide sufficient information about the different methods of the outflow.

This would include over-invoicing and under-pricing of exports and money laundering strategies.

Credible

"People will import an item into South Africa, and it is supposed to be sold for R10, but instead South Africans pay R30 for it - this is one of the ways to suck capital out of the continent," Mbeki said.

"In some instances mining companies will export platinum...and in the customs records they will say they are exporting tin, which has a lower price."

He said the panel was not starting work on a "blank slate" as there had been previous discussion on the financial outflow.

"We will identify the gaps that are missing and produce something that is actionable. The panel will produce a report that is credible to everybody."

The panel includes Economic Commission for Africa executive chairperson Abdoulie Janneh, Coca Cola Bottling Company's Nigeria chairperson Olusegun Apata and director of Global Financial Integrity in the United States Raymond Baker, among others.

Comments
  • Trevor - 2012-02-19 13:29

    If Africa plays it's cards right, WE can be the powerhouse of the world...we have what China and America desperately need, resources...but that will never happen, the continent has only ever provided one sure thing, failed Dictatorships and SA is no exception.

      Abiola - 2012-02-19 13:59

      You are 100% right,We have the resources,We need to unite and we can be the powerhouse..Euro Crisis affect the Europe country, Greece have a serious financials prob and all this only affect Africa before our resources is been taken out of the country and resell to us at high cost..Africa is a blessed continent and our lead know this.. that is why they hardly want to leave the seat of power...

      Spyker - 2012-02-19 14:32

      It is part of the African Culture. Its origin is the corrupt leaders/governments of Africa - before we forget though, 'corrupt leaders/governments' voted in by the people of Africa. All that Mbeki has achieved was to make a massive indictment against Africans themselves. Others are exploiting Africa because Africans are so (easily) 'corruptable'. Africa is not the only continent with natural resources - dream on. The USA, Canada and Australia have vast deposits of natural resources, but they are simply not remotely as corrupt as indigenous Africans - a simple, albeit inconvenient verity. These countries do not make a huge fanfare about their resources, because they do not sit on their backsides parasiting off their natural resources (and little else). A verity based on solid research substance: people will dodge the tax-system if they perceive their tax-contributions are being wasted (through corruption, incompetence, etc). Until recently, I worked for a multi-national British company, for almost a decade. They have many offices throughout Africa and thus their accounts/books cater for notable financial activity in Africa. They have an official line in their ledger called "AFRICAN CULTURE". To put it in simple language - their employees claim the money they have to pay as bribes, in Africa, as an expense. GO FIGURE..!

      goyougoodthing - 2012-02-19 14:35

      We may have the resources but the people of Africa are the world's dumbest. We have no chance.

      Paul - 2012-02-19 15:24

      Quite right, Spyker. No bribe, no business. So what do Mbeki & Co want to do? Dream up a few more laws that won't be policed?

      criticallyhonest - 2012-02-19 18:30

      Wrong Trevor...four things, you forgot corruption, greed and violence

      Francois - 2012-02-19 19:40

      I think one should add that sometimes an invoice that should say R 30 billion for education, housing and food stated R 80 billion for arms and Mbeki paid it.

      Jack - 2012-02-19 19:54

      Must say that Africa has been doing far better of late. There are much fewer reports of civil war and fighting in general. Some of the most recent wars would have been averted if not for Western influence (Libya for one). Corruption remains a problem, but it is far more widespread globally than many would believe!

  • Burtfred - 2012-02-19 13:32

    Who cares what Thabo has to say? Not even his own party which he once led listens to him.

      Vusi - 2012-02-19 13:45

      Burtfred, please don't call the ONLY good President we have had since 1994 on his name. Address his as President Mbeki! Who would you rather have? President Mbeki or Zooman?

      Ron - 2012-02-19 14:26

      Vusi, you woosie! What is happening inside your head?

      Burtfred - 2012-02-19 14:38

      Vusi - "who would I rather have as president - Mbeki or Zuma?" Well actually, neither.

      Tuner - 2012-02-19 14:54

      Problem with your idea is that Mbeki is no longer a president. He is a former president. Anyway Mbeki was devious in other ways especially with his "quiet diplomacy"! So does that make him any better?

      Sinudeity - 2012-02-19 15:38

      Vusi - thabo (lower case t) donated R30 million of his ill-gotten ANC gains to the ANC. He supported mugabe, who has billions of dollars in Chinese bank accounts.

      Glyn - 2012-02-19 15:45

      @Vusi - You are right. Mbeki was the best president we have had. Mandela was a great man at stopping a complete armageddon in South Africa but as an operating president he was not so good. (arms deal waste/education destroyed). Zooman is a total joke as a president. Mbeki was not perfect himself but the Polokwani fiasco was not good for the country. If the anc could get it into their thick heads that Africa and South Africa in particular have all the ingredients for success and those ingredients should not be destroyed then South Africa/Africa will sing! Vote DA! Get rid of the anc oligarchs!

      Francois - 2012-02-19 20:46

      Vusi, I think you will have a lot of explaining to do why you think that Mandela was not a good president and even if you manage to do that, please bear in mind that Mbeki was the de facto state president then, Madiba had to reconcile the nation which he did. Mbeki unfortunately started with his color book project. Then SA is not like the USA. In the USA you remain president. In SA, you become a normal citizen again. Thus ito official titile, Mbeki is at best Mr Mbeki, the title "president" is reserved for Zuma. Then in SA, in the bill of right we have freedom of expression, thus if Burtfred want to address Mbeki as Mtafelki, he is 100% allowed to. I myself think that Racist or Hypocrite is better forms of address. Clown, Frustrated Old Man, Touchy Fool may all be better.

  • Penny-wise - 2012-02-19 13:32

    That's because Africans can't handle power or money. It goes to their heads and they end up mad like Mugabe, Idi Amien and Gadaffi. The same old sad African story. Forever it shall be...

  • Larry - 2012-02-19 13:44

    Does not Show a lot of confidence in the ANC, but I wonder how much of it is the Black elite, banking ill gotten gains in the Virgin Islands and elsewhere?

      Vusi - 2012-02-19 13:48

      Lots and lots of them Larry! Ask The Shaik for details..........................

  • Abongile Mbauli - 2012-02-19 13:47

    Yes, we know Mbeki! Politicians steal money and hide it in overseas accounts. Stop telling us the results and fight the cause! These thieving people must be publicly villified and prosecuted!

      Vusi - 2012-02-19 13:50

      Eish!!!! Watch your mouth....you address him as President Mbeki! And all of the rest of what you said is absolutely true!

      Abongile Mbauli - 2012-02-19 14:05

      Respect is given where it is earned.

      Sinudeity - 2012-02-19 15:35

      Vusi - You mean thabo?

      rowen.loretz - 2012-02-19 16:30

      THE ONLY REASON VUSI WANTS THABO BACK IS BECAUSE MALEMA WANTS THABO BACK AND TOGETHER THEY WILL TOTALLY DESTROY SOUTH AFRICA....THIS IS WHY. THABO HAS NO BRAINS JUST LIKE MALEMA

  • spartanx93 - 2012-02-19 14:12

    Mbeki you mampara:P This is old news!!

      Ron - 2012-02-19 14:29

      Vusi, for the record... mampara is Shangaan for President!

  • Dennis - 2012-02-19 14:12

    Mbeki, this was happening when you were the president !! Why the sudden concern ??

  • jacques.koorts - 2012-02-19 14:16

    Bheki, thats nothing, you must see how politicians are stealing inside the continent. Probably $25bn over the continent. So that comes to $75bn that we citizens will never see. Never ever, each year.

  • Rudie - 2012-02-19 14:29

    .. and the major source of the drain is the politicians of Africa. Been there, go to any African country for any project involving infrastructure, and you have to pay a minimum 15% "development fee" to go anywhere. Africa will NEVER be a powerhouse, for this simple reason. Some of the less scrupulous individuals / corporations have already done the math and they know that, to buy an African asset, you do not need to be willing and able to pay the full purchase price, but the bribe. It is cursed by its own people and lack of values. It will never change.

  • Andrew - 2012-02-19 15:04

    How surprising. Its is the African despot dictators that are squirriling it away. e.g Mugabe, Gadaffi, Dos Santos and the rest. Are you surprised. Get to the root of the problem not the result Mbeki but that is politically sensitive and as we know African leaders find no fault in their own!!

  • Mboma - 2012-02-19 15:17

    The ex-president is correct, but he conveniently forgot his part in the lost billions, if he can count correctly. Remember the arms deal and all the off-shore accounts that went with it? He also did what he is criticizing everybody about and it sound more like "being called ugly by a frog".

      Glyn - 2012-02-19 15:54

      @Mboma - I like your turn of phrase ... "being called ugly by a frog"! There are a lot of frogs in the anc! Rich frogs!

      Fred - 2012-02-19 17:58

      He's not correct. By following his line of throughout, investors will stay away even more. He's in a victim delusion.

  • Sinudeity - 2012-02-19 15:33

    Mbeki, you hypocrite. You support Mugabe. And he has billions of dollars offshore. Same with Gaddafi. He had an estimated $30 billion in foreign bank accounts.

      kthage - 2012-03-17 20:01

      @Sinudeity, You are wrong. Gaddafi fell out of favor with the USA. There was no money offshore, it was all fabricated but I guess you believe everything you here. Libya had one of the highest living standards in the Africa, healthcare and education were provided for, unlike many other countries that have debt. Libya did not have debt to speak off, nothing absolutely nada, the country was running like a well oiled machine. Check the US published magazine called "The Economist" and see how much reserves Libya had before the war, they had over $150 Billion, now that money has disappeared into thin air, Libya is being loaned back it's money to rebuild all the infrastructure that was destroyed. I am in USA and on the radio it is being actively discussed as to what happed to Libya's Billions, why is Libya needing finance for the first time in many years? What billions does Mugabe have? The same WMD that Iraq had? By the way I am not a fan of Bob

      Smell - 2012-03-20 08:59

      If you are not a fan of Bob it automatically makes you a friend of mine.

  • Glyn - 2012-02-19 15:34

    Make the conditions right to invest and those billions will flow the other way. The anc is the local problem, vote them out! The DA will make investment worthwhile and the money will flow into the country. Vote DA!

  • Andrew - 2012-02-19 16:04

    And how much of that was taken by the African leaders (Mugabe, Dos Santos ect) Mbeki supports?

  • Yolisile - 2012-02-19 16:06

    Eish T-Bos why did you take so long to reveal/intitute action to this one.

  • Hugo - 2012-02-19 16:58

    my leader

  • Warren Cowley - 2012-02-19 17:02

    I think most people are aware of this Mbeki, thanks for the reminder. But it is time for action. We need smart and educated people in the leadership - who are disciplined and brave enough to see the bigger picture and implement the necessary changes. We cant sit in the past and debate about which goverments did a better (they've all been a total flop). And it start with each individual.

  • Warren Cowley - 2012-02-19 17:02

    I think most people are aware of this Mbeki, thanks for the reminder. But it is time for action. We need smart and educated people in the leadership - who are disciplined and brave enough to see the bigger picture and implement the necessary changes. We cant sit in the past and debate about which goverments did a better (they've all been a total flop). And it start with each individual.

  • monde.mbingeleli - 2012-02-19 17:28

    Big up's to this initiative, colonialist deploy every stratey to suck Africa, it's about time they 're exposaed for what they really are. My concern however is that we've been suspicious about such activities over a long period of time and hope that the panel's findings is acted upon by powers that be.

      Fred - 2012-02-19 17:56

      This is an old story that just isn't true anymore. That was more a hundred years ago. Mbeki is stuck in victimhood. Thankfully he's largely irrelevant or our country would be under real threat.

      Andrew - 2012-02-19 18:11

      "Colonialists". Shame, always the victim

      Lion - 2012-03-17 19:06

      Monde.. You idiot. Where is money flowing to? The Chinese have their fingers in the pie in Africa. They are the ones raping this continent and the coastlines as well. Do they look like colonialists to you. Wake the f@ck up idiot

  • Fred - 2012-02-19 17:54

    Africa is hardly on the radar of the US, unfortunately. The US stays clear of corruption, unless it's totally necessary, as in the oil despots of the last century. China doesn't.

  • DuToitCoetzee - 2012-02-19 18:07

    The idea is correct. I will not praise him for saying that because he also have his skeletons. We, Africa get rip off, but that is a lot our fault. We produce, mainly, bad leadership and when rebellion against the one(West) we allowed another one(East) in. We need to get people with technology in to teach us and than do it for ourselves. They can make a profit, while we learn, but just till we can manage. The biggest benefit to them is that we focus on in-fights while they reap the benefits. We are also guilty of greed and to stay in power we push the part of population, that have some of those skills, away to gain vote and stay in power.(read white) I suggest we keep and get back some of them and let them feel part of Africa. Even our black stars leave our country. For those two groups of people it is not so much the continent, but the living conditions in it. To be honest, we have to admit that those people have a love for the continent and it would have been better to keep them here than bring in people that do not understand Africa. I want to be part of a successful continent and do not as well as want to fit anywhere else. We, as Africans, must start getting rid of bad leaders, greed, crime and work for the bigger goal, Africa prosperity. There will be some of you that say a lot of "yes, but" although if we address these issues we will never have to say that again. Imagine a traditional Boer, Zulu, Xhosa, ect. in USA/Europe/Asia. They just don't fit there.

  • ian.bosch - 2012-02-19 21:02

    how does this compare with the billion stolen by the cANCer every year right here in SA scumbuckets

  • Thian - 2012-02-19 21:26

    It is unbelievable to listen to the incohereht thrash spoken by Mbeki. It would make very interesting reading to see a summary of all the money stolen and hidden in overseas bank accounts by the so-called leaders of african countries. Once this is known it can be compared with the funds mbeki is ranting about. The results of this comparison may even result in mbeki keeping his mouth shut out of shame.

  • Viman Singh - 2012-02-19 21:30

    How is it that Africa always looses out yet other developing countries in Asia and South America seems to only gain?.....i guess our leaders need to wake up.

  • Mario - 2012-02-20 08:45

    I fully support former President TM Mbeki.African has to ensure that it benefit from its mineral resources.

  • siviwe.viddo.ngcobondwana - 2012-02-20 08:46

    That will be the best thing to do in order to stop financial outflows.This panel has been long overdue.

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