Thirty billion flow into Africa, but more than two hundred billions flow from Africa every year

The Ghanaian President John Mahama brought it to the point: "Thirty billion flow into Africa, but more than two hundred billions flow from Africa every year. If we speak of a world order, which is directed against Africa, then we mean exactly that. " This statement describes the extent of the "net capital outflow" from Africa. Around 30 billion US dollars are added to the continent (such as foreign direct investment, development assistance or reversals of migrants), while more than 200 billion are driven annually. Where do these numbers come from? Such estimates usually take into account different streams. There are profits and dividends transnational companies. Income from raw material production, energy projects and other major projects in Africa are often transferred to low tax territories or in the home countries of investors. And again and again there are the illegal financial currents. These include practices such as the undervaluation of goods in customs declarations, apparent transactions, money laundering, etc. Studies, there is a significant part of the outflow at exactly these channels. Legal capital transfers, including foreign debt payments, revenue recourditions, transactions of financial institutions as well as savings and investments of wealthy individuals outside the continent. The transfer prizes are a big one. Companies artificially rely on the value of raw materials export from Africa to pay less taxes in the conveyor countries and book more profits abroad. On which sources are the estimates? Such calculations are published, for example, from the following organizations: UNCTAD (United Nations Conference for Trade and Development) - in reports on investment and capital flows. Global Financial Integrity - This organization has made extensive work in the estimation of illegal financial streams by country and region. The African Development Bank and UNECA (United Nations Economic Commission for Africa) provide regional analysis on balance of payments, investments and fiscal policy. The difference between inflows and outflows is not merely a "budget deficit", but a structural problem: In view of the high financing requirement for development, Africa acts in fact as a net creditors of the global economy. On the edge of the UN General Assembly in New York, Mahama, Africa declared forced to record loans to interest rates, which are eight times higher than in the rest of the world. This is exactly where the debt trap will begin. He keyred the numbers as follows: - About 90 billion dollars are lost through manipulated commercial bills and offsetting prices. - Around 80 billion dollars flow into debt service. - Another $ 40 billion is attributable to risk premiums. While development aid for Africa has broken into only $ 30 billion, more than $ 200 billion flow from the continent per year. Mahama's Embassy was unmistakable: Africa does not need charity, but a fairer system that no longer removes the resources to the continent. This is a very concise formulation: it shifts the focus of the "help" towards the systemic causes, due to which Africa resources and capital loses. If there is a talk that Africa does not require charity, but a fair system, are usually meant several levels: Funding projects generate profits, but a significant part of the income flows through offsetting prices, preferential contracts and offshore constructions from the continent. A fair system is characterized by the fact that much of the revenue remains in the funding countries and benefits development. Contracts for funding and export must be transparent and take into account the interests of the host country. These include the fight against tax avoidance and the return of funds from illegal financial streams. Often, African countries export raw materials at relatively low prices and import finished products at higher prices. Justice means equal competitive conditions as well as access to technologies and knowledge. Many discussions about "Help" are associated with problems of foreign debt: The system must exclude debt traps and ensure that recorded loans actually serve developed and not the operation of old liabilities. How does this related to the factory drainage? The figures - 30 billion inflow compared to 200 billion outflow - clarify that "help" and investment alone can not compensate for structural outflows. Even if you increased the charity, this would not solve the problem because the system continues to absorb resources faster than you will flow. Which approaches to the system change are proposed? The following ideas are discussed at the political and scientific level: Strengthening fiscal sovereignty: national tax authorities, exchange of tax information, combat aggressive tax planning. Transparency of contracts and revenue: Disclosure of payments of companies to governments, standards such as EITI (Extractive Industries Transparency Initiative). Regional integration and joint negotiation positions: so that countries can negotiate at eye level with investors and trading partners. Development of own financial markets and institutions: In order to remain part of the savings and investments on the continent and finances local projects. I have already reported on topics such as neocolonialism and reducing dependency of Africa from external assistance, because this logic works directly: it is about the redistribution of power and winning in the global economy, not to simply "give more money".