HARARE: ILLICIT financial flows have this year cost Zimbabwe more than $500 million, which is enough to buy about over half of the season’s supply of grain for the country. Zimbabwe requires about 1,8 million tonnes of maize annually at a total cost of about $702 million at the Grain Marketing Board.
Reserve Bank of Zimbabwe governor John Mangudya said the authorities are dealing with the cancer. “For this year alone Zimbabwe has lost more than $500 million which has no authentic, bona fide justification,” said Dr Mangudya.
“I’m very concerned from where I sit as most companies are now abusing the systems in Zimbabwe by utilising funds from company accounts into individual accounts so they can take money out of the country. This is happening and we shall deal with that problem. It’s not desirable,” he said.
He said some companies are taking advantage of the opening up of the exchange controls to drain money out of the country. “That shows lack of confidence. How can you be confident that you love to live in Zimbabwe without your money? So you send your money to Mauritius, China or Pakistan or other parts of the world but your business is in Zimbabwe,” he said.
“It’s a paradox. So if you aren’t happy with Zimbabwe it’s better you go and live where your money is. It’s a grave concern. I looked at the statistics and found out that it’s a cancer that we’re brewing,” said Mangudya. “This calls for measures to curb the bleeding of the nation through the illicit financial flows.
“We need to improve on foreign exchange management systems. We need compliance. Systems are there but those people who’re given the task of implementing our policies must walk the talk,” said Mangudya.
One of the measures under the foreign exchange management systems in other countries includes cash limits. The United States, for instance, limits daily cash withdrawals to $10,000 per individual.
Other measures are expected to include crafting legislation to coerce mining firms to release production data. The measures will help to curb illicit financial flows and money laundering. According to a recent study, Africa loses between $50 billion-$60 billion annually through unscrupulous movement of money outside the continent.
According to study, the flow of illicit money out of Africa is facilitated by a global shadow financial system comprising tax havens, secrecy jurisdictions, disguised corporations, anonymous trust accounts, fake foundations, trade mispricing, and money laundering techniques.
