Crisis in the West - Opportunity for Africa

Paul Collier, who directs the Centre for the Study of African Economies at Oxford University, has written an interesting article about how the global financial downturn provides a timely opportunity to root out the looters of Africa's wealth and their banking facilitators in the West. He is the author of The Bottom Billion

...........now that we have the banks on the run there is an opportunity to extend scrutiny, not only to help ourselves, but to help Africa.

The loot-seeking elites that control parts of Africa illicitly send capital out of the region to the tune of $20 to $28bn per year. Illicit money flows are hard to quantify, but this is the new estimate by Raymond Baker of the NGO Global Financial Integrity, the most careful and ingenious study to date. Capital flight of this magnitude is roughly equivalent to the entire aid inflow to the region, so closing it would generate a similar resource transfer to doubling aid. One side-effect of the financial crisis is that aid commitments will be at the front of the queue for spending cuts. For example, in the vice-presidential debate it was the only Democratic spending pledge that Joe Biden suggested might be rethought.

While the crisis will weaken our assistance for the poorest countries by curtailing aid, it could inadvertently have an offsetting effect if we use it to close the illicit outflow. Money flows out of Africa into our banks, and into the offshore banks that depend for their existence upon being able to transact with our banks. US rules on banking transparency are even weaker than the European rules: vast sums looted from the public purse in Africa are being held in nominee accounts and moved around the world at greater speed than our cumbersome legal processes can track them down.

Western legal systems are stacked, thanks to the hired hands of skilled lawyers, to protect the rights of the crooked over the rights of Africa's ordinary citizens. At the time of the Commission for Africa, I urged that Britain revise its laws on banking secrecy. Yet despite the enormous emotional energy aroused by Gleneagles, there was no political appetite: aid, yes; banking openness, no. The silver lining in this grim cloud is that we have a second chance to clean up the banks. Which takes me back to where I began.

But why would we expect western governments to return that which is rightfully the wealth of Africa's citizens (remember: 54 countries, 922 million people)looted by Africa's elite when they've never returned the wealth (note: gold, cocoa, sugar, coffee, ivory, rubber, oil, diamonds, amongst a wide range of other minerals, agri-produce and resources including, e.g. coltan essential for mobile phones) stolen from their former colonies which they continue to plunder through brutal trade policies, etc.?