Extractive Sectors and Illicit Financial Flows: What Role for Revenue Governance Initiatives?

By Chr. Michelsen Institute
Updated: 09/12/2012

Natural Gas For Sale AfricaBy Philippe Le Billon. Chr. Michelsen Institute, November 2011.

Resource-rich African countries experience comparatively higher levels of illicit financial flows, which often weaken the state through substantial losses of revenues. The concentration of authority over the extractive sector, poorly negotiated contracts, and weakly regulated integration into the global economy that are common in Africa facilitate these illicit flows. New international initiatives intended to improve transparency and recover assets and revenues are filling these gaps, but more work to strengthen African tax and revenue governance can further minimize the destabilizing effects of illicit financial flows.

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