$10bn lost annually as illicit financial flows ride through South Africa – Rowden

South Africa is combatting a scourge of illicit financial flows out of the country. In 2015, former President Thabo Mbeki released a report in which he said that illicit financial outflows from South Africa far outstripped official development aid. Even Jacob Zuma raised the alarm about 'the scourge of illicit flows" just before he departed and said South Africa signed several international treaties to exchange information. It is not always easy to come up with exact numbers of what the extent of the problem is, but a Washington-based company, Global Financial Integrity has identified a $8.7trn gap in global reported trade. The GFI has indicated that $1 of every $5 that is sent out of South Africa in trade, is actually done illicitly, which means Finance Minister Tito Mboweni is missing out on an eye watering sum of trade taxes. The GFI's Rick Rowden, a senior economist told Alec Hogg that they have developed a data tool that can analyse the individual transactions of companies. – Linda van Tilburg

"What we monitor is the amount of trade that happens between two countries that is not recorded. Sort of the hidden amount of trade that is happening, the actual value that is being hidden because of the way the importers and exporters falsify the prices that they put on their invoices that they submit to their respective customs," says the Global Financial Integrity's Rick Rowden. The actual price of cargo being shipped between countries could either be under-priced or over-priced depending if people were trying to move money in or out of countries. 20% was roughly their estimate for South Africa's trade with 36 advanced economies.

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