UN ECA warns Africa loses $40B yearly to extractive sector IFFs, calls for urgent reforms and reparatory justice.
The UN Economic Commission for Africa (ECA) says Africa loses $40 billion annually to illicit financial flows (IFFs) in the extractive sector—funds that could otherwise build infrastructure, create jobs, and improve public services.
Speaking in New York at the close of the 2025 African Dialogue Series, ECA Deputy Executive Secretary Antonio Pedro blamed these leakages on Africa’s colonial-era economic model, which remains heavily reliant on raw material exports.
“IFFs in the extractive sector are a symptom of a deeper structural problem—Africa’s overdependence on raw material exports,” Pedro said.
IFFs = Exported Jobs
Pedro stressed that Africa exports value and jobs by failing to industrialise. With 20 million new jobs needed yearly to support a growing youth population, stemming capital flight is critical.
IFFs—driven by tax evasion, transfer mispricing, and shady contracts—also erode national revenues, undermining sustainable growth.
Reparatory Justice and Global Reform
Linking IFFs to reparatory justice, Pedro urged African nations to speak with one voice on the global stage and push for fairer systems.
He called for the implementation of the African Mining Vision and the African Green Minerals Strategy, both designed to foster value addition, local content, and industrialisation.
What’s Needed Now
1. Policy coherence across mining, trade, energy, and infrastructure
2. Transparency in contracts and revenue flows
3. Reforms in global finance to close loopholes exploited by IFF enablers
4. Unified African advocacy through platforms like the African Dialogue Series
“Turning political commitments into action is the next frontier,” Pedro concluded.
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