Ethiopia’s wealth had been illegally trafficked out of the country and deposited in foreign countries and banks. And the government has been making a wide-range of preparations since the onset of the reform to repatriate the wealth.
In this regard, the government has done well in formulating a well-structured and responsible organ that works in repatriating the stolen wealth. Apart from preparing a strategy and road map, it has established a directorate that runs the process.
Consequently, a strategy has been prepared to tackle corruption and to identify the current status of the stolen wealth, corrupt individuals and country or bank in which it was deposited. As well, the government has been striving to establish strong diplomatic relations and has made bilateral discussions taking international laws into account.
Many countries have assured their readiness to expose corrupt individuals and have signed agreements for the reparation of the wealth. Efforts are well underway to reach similar agreements with other countries. In fact, there many reason to fight money laundering in a coordinated manner. Firstly, money laundering has clearly become endemic to social, economic and political frameworks.
Secondly, it ultimately affects and often subverts banking and other financial institutions. It affects multinational corporations and small businesses. Then, it can harm the soundness of a country’s financial sector as well as the stability of individual financial institutions in multiple ways.
Thirdly, it leads to undermining the legitimate private sector. Money launderers are known for using front companies. These front companies co-mingle the loot with legitimate funds in order to ward off the ill-gotten proceeds.
In reverse, front companies’ access to illicit fund allows them to subsidize their products and services so that they make their goods and services available to the public on lower prices than is normally the case in a competitive market.
Consequently, legitimate businesses find it difficult to cope with such front companies. Therefore, they will be forced to get out from the market and it will have further consequences up on government as well as the society at large.
Fourthly, it affects both the microeconomic environment-which is the economic lives and wellbeing of individuals and businesses-and the macroeconomic climate of a country.
Fifthly, it affects privatization. The efforts of many countries to reform their economies through privatization have also been manipulated by money launderers. Criminal organizations are capable of outbidding legitimate purchases of former state owned enterprises and consequently increase their potential for more criminal activity and corruption using those enterprises as legitimate fronts to launder funds.
In general, governments should cooperate to avoid money laundering and repatriate stolen wealth to avoid or at least limit criminal syndicates to dismiss profits from committing crime. Or else, they facilitate crime by capacitating criminal groups and networks to self-finance, diversify and grow putting the globe in poverty and threat to live.
Particularly, as Ethiopia, a developing country that is in need of resources to get its people out of the quagmire of poverty, is striving to repatriate its stolen wealth, the international community has to deliver its relentless support in whatever way possible.
The Ethiopian Herald, February 6/2020
