Illicit financial flows: The economy of illicit trade in West Africa
West Africa is losing about USD 50 billion a year in illicit financial flows — more than it receives in official development assistance (ODA). Nearly 80% of illicit financial flows from West Africa are generated from the theft of natural resources, principally oil. Human smuggling across the Sahel generates more than USD 100 million in illicit financial flows for West Africa per year. About 60% of the market value of all medication in the region is estimated to be falsified or substandard. These are some of the key findings of a new OECD study, which analyses the nature of 13 overlapping, and often mutually reinforcing, criminal and illicit economies. The study draws on a collaboration with the African Development Bank (AfDB), the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), the New Partnership for Africa’s Development (NEPAD) and the World Bank. It identifies the networks and drivers that allow these criminal economies to thrive, with a particular emphasis on the actors and incentives behind them. The report underscores that there is no shortage of strategies, initiatives and declarations in the ECOWAS region. Given the scope of the criminal economies, it is crucial to set priorities and reinforce the implementation of national and regional legislation. However, West African policymakers will need support from their development partners. “OECD member countries can play a far more rigorous and active role in addressing criminal economies and illicit financial flows outside the region,” concludes the report.