Corruption Costs Poor Countries USD 1 Trillion A Year – Report

Society | September 4, 2014, Thursday // 14:57|  views

File photo.

World’s poorest countries are deprived of at least USD 1 trillion each year by criminals and corrupt officials through money laundering, illegal tax evasion and embezzlement, a report published Wednesday by the anti-poverty organization One says.

'The Trillion Dollar Scandal' report said the misuse of funds resulted in USD 38-64B a year in uncollected taxes alone.

This in turn cost 3.6 million lives a year that could be saved if the missing money were wisely invested, non-government organization ONE estimated.

"Corruption inhibits private investment, reduces economic growth, increases the cost of doing business and can lead to political instability," the report says.

"But in developing countries, corruption is a killer. When governments are deprived of their own resources to invest in health care, food security or essential infrastructure, it costs lives and the biggest toll is on children."

The report says that if corruption was eradicated in sub-Saharan Africa education would be provided to an additional 10 million children per year, money would be available to pay for an additional 500,000 primary school teachers, and antiretroviral drugs for more than 11 million people with HIV/Aids would be provided.

The US-based organization urges the leaders of the 20 largest economies, the G20, to tackle corruption at the leaders' summit in Brisbane in November by launching a crackdown on corruption in four main areas, including making information public about companies and trusts owners to prevent them being used to launder money and conceal the identity of criminals.

The organization insists on the introduction of mandatory reporting laws for the oil, gas and mining sectors so that countries' natural resources "are not effectively stolen from the people living above them".

It recommends action against tax evaders "so that developing countries have the information they need to collect the taxes they are due" and more open government so that people can hold authorities accountable for the delivery of essential services, the BBC reports.

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Tags: corruption, money laundering, embezzlement, tax evasion, G20, summit, ONE


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