Stemming the legal transfer of wealth out of the world’s poorer countries is one of the most effective ways to help their governments raise the additional revenue needed to improve services such as education, health, energy and transport, a panel of experts said on 5 June during a high-level discussion in Geneva.
The comments came during the annual meeting of UNCTAD’s governing body, the Trade and Development Board, and the experts were addressing the issue of plugging financial leakages to help fill the trillion-dollar investment gap that developing countries face to fund the projects associated with the UN-endorsed 17 Sustainable Development Goals (SDGs).
“We know that the ambitious Sustainable Development Goals can only be achieved if we manage to mobilize national and international resources, which is far from the case currently,” UNCTAD Deputy Secretary-General Isabelle Durant said in her opening statement.
“One of the best ways of raising these resources is to plug the many financial leakages that have allowed inequalities to persist and indeed grow deeper between and within countries,” she added.
But as the speakers noted, the financial flows stripping government coffers are both illegal, such as criminal funds related to drugs, racketeering and terrorism, and legal, such as tax avoidance and the wealth stashed in offshore tax havens.
And the legal part of the pie may be the bigger and easier to combat.
According to the background note that UNCTAD prepared for the discussion, of the hundreds of billions of dollars thought to be hidden from governments, an estimated two thirds relate to cross-border tax-related transactions.
By LOSIRENE LACANIVALU SUVA
Prime Minister Voreqe Bainimarama reiterated that Fiji fully supported the elimination of safe havens that created incentives for transfer abroad of stolen assets, criminal gains and illicit funds.
Speaking at the Intervention remarks at the G77 and China Ministerial meeting Interactive Dialogue in New York, Mr Bainimarama said this included funds that were legitimately owed to governments in taxes or that could be used for development but were being diverted offshore at the expense of the people.
“We must continue to increase and intensify international tax co-operation and combat illicit financial flows in order to mobilise domestic resources for inclusive and sustainable development,” Mr Bainimarama said.
Mr Bainimarama spoke on the theme of financing for development and strengthening the framework for international cooperation on tax matters.
He said Fiji recognised that the Addis Ababa Action Agenda provided a global framework for financing sustainable development and was an integral part of the 2030 Agenda for Sustainable Development.
He said the framework provided for concrete policies and actions and reaffirmed the strong political commitment to creating a proper enabling environment for sustainable development.
“Full international cooperation will be absolutely necessary to implement the 2030 Agenda for Sustainable Development and international development cooperation, especially North-South cooperation, remains a fundamental catalyst to sustainable economic growth,” he said.
“We are pleased to see the increasing recognition of the central role of tax systems in development, and we are deeply concerned over illicit financial flows and related tax avoidance and evasion, corruption and money laundering.”
Mr Bainimarama said the Fijian Government was attempting to combat this forcefully in Fiji through legislation and agreements with other nations, but the process was long and arduous and enforcement required training and resources.
The theme role of the Group of 77 in promoting the implementation of the 2030 Development Agenda in the light of the commemoration of the fiftieth anniversary of the “Charter of Algiers” was adopted by the First Ministerial Meeting of the Group of 77 in 1967.
Mr Bainimarama said the world was facing many challenges that demanded their attention and collective action.
“It is gratifying to know that the founding mission of the G77 is as valid as ever, this is why we eagerly join in congratulating the group in commemorating the 50th anniversary of the “Charter of Algiers,” which sets forth the Group’s strategic vision and objectives,” he said.
He said millions of people were suffering from climate-related impacts or living through disasters.
“Fiji will be doing all it can to ensure the views of this group will be heard and I will be counting on all your support for the success of COP23,” he said.
Published on Fiji Sun Online on September 22, 2017