PM says illicit financial flow devastates developing economies


–Analyst says 86pc of ill-gotten money is flowing through global banking system

NEW YORK: Prime Minister Imran Khan on Thursday urged the western countries to treat money plundered by the rulers of third world countries in the same way as it treats drug money or terror financing as such practices devastate economies of poor countries.

Addressing High-Level Dialogue on Financing for Development on the sidelines of 74th session of the United Nations General Assembly (UNGA) in New York, he said illicit financial flows devastate the economies of developing counties.

He said people in the developed countries do not realise the impact it has on the rise of poverty, destruction and lack of human development in the developing world.

The prime minister said when his government took power, it inherited a huge debt and in the previous 10 years, it was increased by four times due to corruption of political elite.

He said most of the plundered money was laundered and sent abroad to invest in foreign bank accounts, properties in western capitals and offshore accounts.

PM Imran said the Pakistani government was trying its best to retrieve the looted money but our efforts are hampered by legal lacunas and other issues in this process.

He said the stolen money could have been spent on education, health and other facilities of life for public, the quality of life would have significantly been improved in our country.

The prime minister regretted that there was a lack of political will in the richer countries to help return the wealth plundered by corrupt politicians of the developing world.

He said it not only deprives a developing country of its vital resources, but it is not a deterrent against corruption. So, the corrupt elite from poorer countries invests the looted money in the advanced world without any fear of accountability.

Imran said no matter what aid goes from richer countries to poorer countries is minuscule in comparison with the money looted by corrupt elements and stashed in offshore accounts. The prime minister questioned why offshore tax havens exist in this day and time?

The discussion also saw other leaders and experts stressing on the importance of clamping down on illicit financial flows.

Sneha Shah, a financial analyst with Thomson Reuters’ Refinitiv, shared alarming figures with the forum including that 86 per cent of the ill-gotten money is flowing through the global banking system.

“We are losing 1.5 trillion dollars in illicit financial flows each year and we are not winning this battle. How much we are recovering? One per cent of that wealth,” she said. “And 86pc flowing is through the banking system, so we are not winning.”