Africa is losing an estimated $40 billion each year to illicit financial flows (IFFs) in the extractive sector, draining resources that could otherwise support critical investments in infrastructure, education, health, and employment, the United Nations Economic Commission for Africa (ECA) has revealed.
Speaking during the closing session of the 2025 African Dialogue Series (ADS) in New York, Deputy Executive Secretary of the ECA, Antonio Pedro, described the losses as a serious threat to Africa’s development and economic sovereignty.
“These are not mere leakages in accounting, they are structural failings rooted in an outdated model where Africa continues to export raw materials without adding value, effectively exporting jobs and undermining industrialisation,” Pedro stressed.
Africa’s dependence on raw material exports, is a colonial legacy that persists in modern economic arrangements, making the continent vulnerable to capital flight through tax evasion, transfer mispricing, and opaque resource contracts, he noted.
Pedro underscored the urgency of curbing IFFs to help meet the continent’s growing employment needs. “Africa must create at least 20 million jobs annually to absorb its fast-growing youth population. Preventing these illicit outflows is critical to achieving that,” he added.
From Advocacy to Action: Turning Policy into Progress
Pedro called for the swift implementation of key policy tools like the African Mining Vision and the African Green Minerals Strategy. These frameworks are designed to promote value addition, enhance local content, and ensure community development in the extractive industries.
“What is needed now is to move from political commitments to operational action. These frameworks exist; it’s time to implement them with urgency and coordination,” Pedro urged.
He further advocated for policy alignment across mining, trade, energy, industrialisation, and infrastructure, while pushing for reforms in global financial systems that enable these illicit flows.
Pedro linked the issue of IFFs to the broader push for reparatory justice for Africans and people of African descent. “If we are serious about justice and sustainable development, then dismantling the mechanisms that sustain IFFs must be a core priority,” he said.
Building Unified African Voice for Reform
The 2025 African Dialogue Series, held under the theme “Justice for Africans and People of African Descent Through Reparations,” provided a global platform to advance Africa’s economic justice agenda.
However, Pedro praised the initiative for fostering a united African voice on global platforms and called for continued collective action among African governments, mining firms, civil society, and international partners.
“As we pursue sustainable development, transparency, and accountability in natural resource governance, the time has come for Africa to speak and act with one voice,” Pedro added.
