A mineral tracking system employing a data evaluation tool designed by the United Nations Conference on Trade and Development (UNCTAD) and the Zambian Revenue Authority (ZRA) helped Zambia recover an additional US$1 million in export dues from mining companies in one year.

The system, which makes it easier to detect illicit trade practices that drain billions of dollars each year from the resource-rich nation and its people, is now available for other countries.

Misinvoicing and under-declaration

Trade misinvoicing, under-declaration of exports and other fraudulent trade practices cost the southern African nation about US$12.5 billion between 2013 and 2015, according to UNCTAD’s Economic Development in Africa Report 2020.

But just one year after piloting the Mineral Output Statistical Evaluation System (MOSES) in 2016, the government recovered about US$1 million in unpaid export dues from mining companies.

As a result of MOSES according to commissioner general of ZRA, Kingsley Chanda, “compliance by mining operators has greatly improved.”

Broader applications

In addition to tracking copper and other minerals as they travel from mines to borders, the system allows mining companies to submit their monthly mineral production reports electronically instead of travelling to the capital Lusaka to submit them in person.

Chanda says delays have been cut from up to 230 days to less than one month, allowing the country’s statistical office to produce more up to date national statistics reports for policymakers.

Wider availability

The system is now ready to be used by other governments to help capture illicit financial flows (IFFs) out of Africa.

UNCTAD estimates IFFs out of the continent at US$88.6 billion each year while the UN’s Economic Commission for Africa estimates that Zambia accounted for 65 per cent of all African trade misinvoicing in copper.

Categories: Trade Based Financial crimes News

Tags: Africa, UNCTAD, Zambia