New research indicates that trends in the misappropriation of foreign loans to African countries are even greater than previously projected. In fact, it is estimated that more than half of the money borrowed by African governments in recent decades was misdirected the same year, transferred in many cases to private accounts in offshore tax secrecy jurisdictions. In Africa’s Odious Debts: How Foreign Loans and Capital Flight Bled a Continent(Zed Books, 2011), Léonce Ndikumana and James K. Boyce reveal these intimate links between foreign loans and capital flight, exploring the human cost of fund transfers as well as mechanisms to promote more responsible international financial systems.
On March 19, the Africa Growth Initiative at Brookings hosted a discussion of the book, featuring co-author Léonce Ndikumana. He was joined by Hippolyte Fofack, a senior economist at The World Bank, and Raymond Baker, director of Global Financial Integrity, who provided a broader assessment of the consequences of capital flight as they apply to Africa’s economic growth. Visiting Fellow Osita Ogbu, former senior economic adviser to the president of Nigeria, moderated the discussion. Senior Fellow Mwangi S. Kimenyi, director of the Africa Growth Initiative, provided introductory remarks.
After the program, participants took audience questions.
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