The African Union (AU) has announced that its Specialised Technical Committee (STC) on Finance, Monetary Affairs, Economic Planning and Integration is contemplating measures for the envisaged the African Continental Free Trade Area (AfCFTA) that would specifically address the issue of illicit financial flows (IFFs).

AfCFTA is a free trade area signed up to in 2018 by 54 of the 55 AU nations. So far 30 countries have both signed and ratified the AfCFTA Agreement. Of the 55 AU member states, only Eritrea has yet to sign.

Trading under the AfCFTA Agreement was due to commence on 1 July 2020, but as a result of the coronavirus pandemic, this date has been postponed.

Major drawback

The STC says it recognises that IFFs remain a major barrier to the financing needed for sustainable development in Africa that will be required to effectively achieve the aspirations of AU member states.

The committee therefore puts considerable emphasis on mobilising domestic resources, which involves a specific focus on the fight against IFFs and corruption.

Several notable efforts to stem IFFs have been made at the continental level, including the establishment of the High-Level Panel on IFFs chaired by former South African president Thabo Mbeki and several initiatives by the AU’s Advisory Board on Corruption.

Coronavirus impact

But the coronavirus crisis has intensified the need to curb IFFs according to the committee.

“As the continent continues to suffer from the catastrophic COVID-19 pandemic, it is crucial to strengthen ongoing projects and initiatives to stem IFFs and ensure Africa mobilises adequate resources towards achieving Agenda 2063 and building resilient economies,” according to an STC statement.

Agenda 2063 is the AU’s strategic framework for the socio-economic transformation of the continent within a 50 year period, from 2013 to 2063.

Categories: Trade Based Financial crimes News

Tags: AfCFTA, AU, Coronavirus, IFFs, STC