News Decoder
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Africa has lost more than $1 trillion in illicit financial flows in the past 50 years. (Flickr/CC/ImagesofMoney)

By Hafawa Rebhi

The winter of 1949 was extremely cold in France. A plumber sent a letter to Le Monde newspaper denouncing “la belle vie française,” the “beautiful French life” praised by the liberal newspaper.

“You criticize repeatedly, without proof, that in the USSR people live in bad conditions,” the plumber wrote. “Well, in France we see terror and starvation.”

After some hesitation, the editorial board decided to publish the letter. The missive captured the misery and frustration of the working class. Hunger, cold, starvation: Le Monde’s bourgeois readership did not know much about such things.

Le Monde also printed a request for donations — bedding, clothing, a secure job for the father — to help the unfortunate French family.

The appeal provoked the Communist newspaper l’Humanité, which denounced the “hypocritical charity” of Le Monde, saying the plumber was nothing but “a strange beast” to its readership.

The two newspapers then exchanged a virulent series of dueling editorials. Le Monde could not understand l’Humanité’s resentment, especially after donations poured in, transforming the plumber’s life.

Meanwhile, l’Humanité said the plumber’s misfortune was the product of greed in the class of Le Monde’s audience.

How to finance development without aid?

Years have since passed. French society, Le Monde and l’Humanité have changed. The USSR has disappeared. The concept of class struggle is out of fashion.

But one thing is still valid: Charity is not justice.

At the Third International Conference on Financing for Development in Addis Ababa in July, dozens of activists tried to explain that Africa and the developing world do not want charity anymore.

But how will it be possible to finance development in these less developed regions, often torn by poverty and conflicts, without aid? By recovering huge amounts of money lost in illicit financial flows, especially unpaid tax bills, was a common refrain from advocates of tax justice and financial transparency present at the conference at the United Nations Economic Commission for Africa.

To buttress their position, some brandished a recent report commissioned by the African Union and the UN. It estimated that over the past half century, Africa has lost more than $1 trillion in illicit financial flows that leak from developing nations, due to tax avoidance and to corruption within corporations and among government officials.

This eye-popping sum is about equal to all of the official development assistance received by Africa during the same period, the report concluded.

The rich get richer, the dispossessed get poorer.

Despite that finding, delegates at the conference in Ethiopia’s capital rejected a proposal, backed by developing nations, calling for the establishment of an intergovernmental UN body to combat tax avoidance.

Instead, the conference adopted a watered down provision that said companies, including multinationals, would pay taxes in accordance with the law. In doing so, they rejected the proposed global tax body, saying the OECD — a grouping of rich nations — was already monitoring tax avoidance.

As if OECD countries had a monopoly on expertise and intelligence!

Can development be sustained while poor countries are treated as subordinates? Is the same colonial order valid while the UN is trying to find new ways to finance development in emerging economies?

The world is a tale of countries with different resources and complex economic, political and demographic relationships.

But our global order is growing unsustainable as the rich get richer and the dispossessed get poorer. Changes in mind-set are needed.

One principle remains simple and true: Charity is not justice.

(Click here for more News Decoder articles on Ethiopia.)


hafawa

Hafawa Rebhi is an independant Tunisian journalist. She has been covering the transition in Tunisia since 2011, with a special focus on public policies, social and economic rights, migration, development and energy. She is fluent in English, Arabic, French and Italian.

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