At the end of these two days of thinking on illicit financial flows, could you draw a report for us?
We have gathered as we always do, using CoDA as a platform for dialogue and debate on matters concerning Africa. We have been here for two days, with this afternoon still ahead, to present the Common African Position on Asset Recovery (CAPAR) to new stakeholders, including those engaged in EITI processes, civil society, academia, and the media. We chose to hold this event in parallel to the EITI 2023 Global Conference currently taking place in Dakar because the extractive sector is the sector that contributes the most to illicit financial flows, and we are implementing the CAPAR, the Common African Position on Asset Recovery.
In May of last year, a judgment was made in the US, followed by another one in November in the UK, concerning Glencore, and the Glencore scandal. We were told that EITI is uncomfortable discussing the Glencore scandal, but we could not understand this. The EITI, a good governance instrument in the extractive sector, is now confronted with a major scandal and has come to this continent for the first time, even though its majority members are African. The scandal occurred slightly over a year ago, and yet it is not on their agenda. At this conference, we have called on them and reminded them of their role in promoting transparency, accountability, and integrity, regardless of whether they must deal with governments or multinational corporations. They seem to be more comfortable calling out governments instead of multinationals, and this is something that needs to be corrected.
The EITI credibility is questioned in a context where corruption cases multiply in the extractive industry sector. Is it a good thing in the struggle against IFF ?
You are right to express concern, and that is why we need to proceed with caution because, in the end, no instrument is perfect, particularly when it comes to governance. It is a process, a struggle, and they have been doing what they can. However, in this particular case, we were hoping they would do what they should. We are here to remind them of that, but more importantly, to structure our engagement with them and improve their processes if necessary.
The High-Level Panel on Illicit Financial Flows continues to work on galvanizing its recommendations and mobilizing a broad coalition of institutions and individuals. The EITI and TI are both essential instruments that we must engage with and work together to improve. We are currently in phase 2 of our work, which involves national-level actions.
You are entirely correct, Bacary. We cannot discard them because they are the babies of our civil society. They were brought forward by civil society and are a response to the call of civil society in the extractive sector. However, we must ask why they are not playing their role anymore, whether they have drifted to the point we need to question their processes and data. Our goal was to have an EITI that nobody would question the credibility or integrity of, and that is not the case at the moment.
Is there really a political will to fight against IFF in the extractive sector in Africa ?
When we talk about political will, it is essential to understand that it is a result of many factors. At the African Union level, we have done a lot of work, and the fact that the panel is sustained, the secretariat was moved from UNECA to the AU in 2018, and that the panel has been reinforced with recent funding of close to six million dollars from the African Development Bank to act on the recommendations and decisions of the Heads of State display political will. Many institutions and individuals are still active, committed, and engaged, and we need to keep up that momentum.
We must not compare ourselves to others. Still, we need to reflect on the progress we have made so far in the fight against illicit financial flows. At the global level, Africa has shown ownership and leadership. When the panel finished its task, the Heads of State endorsed the fifteen findings and thirty-eight recommendations of the panel. Therefore, political will is evident, and we need to build on it.
One of the challenges we face is capacity, both in governments and non-state actors. It has been a problem in many of our fights, and it is no different in this one against illicit financial flows. This challenge is not unique to Africa, but it is a structural global issue. For centuries, the continent has been relegated to the role of raw material providers due to colonial and neo-colonial systems. Given this unjust mandate, multinational corporations that operate on the continent do not feel compelled to act responsibly. Unfortunately, corruption and the proceeds of corrupt activities are often tolerated in their countries of origin.
You are at the end of two days of thinking, what are the major recommendations we can take from this meeting in Dakar ?
This afternoon, a “communiqué” will be released regarding the collective resolution to define our next steps. We have heard promising things, which we will capture in writing this afternoon as we commit to carrying on and following up.
To make this happen, we need to galvanize and disseminate CAPAR and turn it into a set of actionable frameworks that we can track and follow up on. This includes implementing frameworks such as a
framework for whistleblower protection, a framework establishing an escrow account, and more. We need to reinforce the national chapters, starting with the six victim countries impacted by the Glencore scandal. Additionally, we want to explore how we can involve countries that are not “victims” and bring them together.
As a result of our discussions this morning, we will establish a working group that will follow up on the outcomes of this meeting. We need to engage in proper consultations and scale-up research, linking it to policy as we continue to make progress. We cannot make decisions solely in one building in one African country. Proper consultations and collaboration are essential to ensure that we move forward together.
I am pleased that my co-host, Birahime Seck, has volunteered himself and his organization to serve in the joint secretariat of this working group together with WATAF. He is knowledgeable, engaged, and his organization’s work extends beyond Senegal, so I believe we will benefit from his expertise.
So one last question, what are the issues you can face while fighting against Illicit Financial Flows ?
The current standard setting at the global level is problematic. The OECD, a club of rich countries, holds all the power and dictates the agenda. However, they are not a legitimate global platform, but they still take on this role and prevent the United Nations from acting on these matters. Africa is not at the table of the OECD, and the same “green room syndrome” that exists in the context of WTO is present here.
The decision making in the United Nations, which was dominated by the Security Council for the longest period, is also evolving. Due to Ukraine war, we are witnessing a shift according to which the most powerful countries are now coming to the General Assembly and consulting with everybody. Most instruments and standard-setting processes at global level need to evolve. While the World Bank and IMF have been criticized for their structural adjustment policies in the past, they are now making good progress.
The current situation where the OECD imposes its leadership, standards, and solutions on the majority world needs to change. It represents the views of a minority and does not result in a fair and inclusive way of dealing with important matters at a global level. It is crucial that we work towards a fair and inclusive approach that takes into account the perspectives and needs of all nations.
