Friday, 20 March 2015 00:00
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Cabinet has approved a special Presidential task force to retrieve billions of allegedly ill-gotten gains by the previous Government and return them to the Sri Lankan State. The new body will work with international groups including the World Bank and International Monetary Fund (IMF) as well as the US and Indian Central Banks in this task.
Dirty money or black market cash illegally transferred to tax havens scattered around the world is robbing everyone a chance for a sustainable future. A record $ 991 billion in unrecorded funds left 151 developing and emerging economies in 2012, up nearly 5% from a year earlier, according to US-based watchdog Global Financial Integrity (GFI) that exposes financial corruption.
Asia was the region of the developing world with the greatest flow of dirty money over the decade, accounting for 40.3% of the world total, driven by China. Sri Lanka’s neighbour India and close countries such as Malaysia were also in the fray. So stark has the problem become that the organisation has called for the United Nations to next year include a target to halve all trade-related illicit flows by 2030 as it negotiates a new set of global goals, the Sustainable Development Goals, to replace the Millennium Development Goals.
While the exact numbers cannot be proven, it cannot be ignored that this trillion dollars lost from economies in 2012 could have been invested in local businesses, healthcare, education or infrastructure. It could have contributed to inclusive economic growth, legitimate private-sector job creation, and sound public budgets.
Sri Lanka too is facing an epic battle against escalating corruption, which has even become the rallying call of the new Government. In the melee of words and accusations, it is easy to forget that Sri Lankan officials too have been embroiled in allegations of holding Swiss bank accounts. Even as early as 2012 Parliament was the scene of a landmark revelation by the Opposition that claimed an alleged 400 officials held or were proxies for Swiss bank accounts.
More recently top officials of the new Government including the Foreign Minister has hinted $ 2 billion has been located in three accounts in a bank in Dubai with the latest task force expected to assist in channelling it back. Cabinet Spokesman Dr. Rajitha Senaratne estimates as much as $ 10 billion may be lying in similar bank accounts scattered around the world.
Despite Sri Lanka being the second country to sign the convention in 2004, it hasn’t impressed on the implementation front so far. Under the Convention, an International Association of Anti-Corruption Authorities (IAACA) exists and under that law enforcement authorities like the Attorney General, Police or Bribery Commission can seek the assistance of countries to trace any laundered money. Yet, without specific details such as names, these mechanisms are all but pointless.
Embroiled in a 100-day sprint the Government is facing increasing challenges to maintaining its focus on battling large scale corruption, perhaps most crucially impatience and disappointments over delays. This is the deep and growing problem of corruption, not just in tiny Sri Lanka, but around the world. Yet even a small country can make a difference – if it wants to.
