Ghana is losing billions of dollars annually to illicit financial flows (IFFs), according to economist Dr. Bishop Akologo. He noted that these IFFs, through activities like corruption, illegal mining, money laundering, and tax evasion, have a detrimental impact on the country’s ability to mobilize revenue for sustainable development.
IFFs, which involve illegal financial transfers across borders, severely hamper economic growth and drive inequality by diverting funds that could otherwise be used for public goods like schools, clinics, and infrastructure. For example, the Global Financial Integrity report revealed that in 2015 alone, Ghana lost over $3 billion through illicit financial flows in trade mis-invoicing, representing a significant portion of the country’s $9 billion trade with developed nations.
Dr. Akologo highlighted that these losses were particularly damaging to the country’s development, and he urged Ghanaian journalists to lead the charge in raising awareness and mobilizing citizens to demand better financial governance. He spoke during a two-day capacity-building workshop for journalists in the Upper East Region organized by the Media Foundation for West Africa (MFWA), supported by Oxfam and the Ministry of Foreign Affairs of Denmark.
Dr. Akologo emphasized that the natural resources sector, especially mining, was one of the worst affected by IFFs. He called for a review of mining contracts to ensure Ghana receives fair value for its resources. He also suggested the conversion of leaked funds into equitable public investments.
Mr. Benaiah Nii Addo, Executive Director of Green Tax Youth Africa, also spoke at the event, calling for reforms to the tax system to curb tax evasion, one of the main drivers of IFFs. He stressed the need for a stronger political will to expand the tax base and ensure fair taxation practices across all sectors.
MFWA Program Officer William Nlanjerbor Jalulah emphasized that data-driven media reporting could play a crucial role in exposing IFFs and their contribution to growing inequality in the country. The foundation believes that through independent journalism, the issue of illicit financial flows can be addressed more effectively, thus helping Ghana safeguard its financial resources.
The call for action is critical as Ghana grapples with the ongoing challenge of financial mismanagement and revenue loss to IFFs, which continues to stymie development and exacerbate inequality across the nation.
