19 August 2014
For each $1 developing nations receive in foreign aid, $10 in illicit money flows abroad—facilitated by secrecy in the global financial system. Beyond bleeding the world’s poorest economies, this propels crime, corruption, and tax evasion globally.
Nevertheless the world continues to make progress in addressing injustices associated with the global financial system. Tax evasion, corruption and lack of transparency continue to drain developing countries of vital funds needed to reduce poverty and properly fund schools, hospitals disability services and the like.
Australia has joined with 46 other countries whereby tax authorities share information. For example, since 2007 more than $1.8 billion of tax owed has been demanded back by Australian authorities from those who hid their money in overseas tax havens.
At a recent G20 meeting in Rome, a set of principles was agreed upon to ensure that G20 countries would know who owns and controls companies operating in this countries and readily exchange this information with other countries. The proposals await endorsement by Finance Ministers and Leaders of the countries.
The use of anonymous companies and trusts which fuels corruption remains a major obstacle in the fight against poverty.
To learn more about the workings of the international financial system and how it can be made more just visit the Global Financial Integrity website.
To take action on this issue visit the Micah Challenge website see