Report By: Kweku Bolton
Ghana is losing billions of dollars each year to illicit financial flows (IFFs), undermining economic growth and development, a training initiative for journalists has revealed.
The financial losses result from corruption, fraud, trade mispricing, mis-invoicing, cost escalation in the extractive sector, tax avoidance, and financial crimes, among others, in the digital economy.
The Media Foundation for West Africa (MFWA), in partnership with the Thomson Reuters Foundation, organised the training to equip journalists with the skills needed to investigate these activities.
Media training on financial transparency
Ten journalists from across Ghana were selected for a five-day residential training session at Ada in the Greater Accra region, aimed at enhancing their ability to report on illicit financial flows. Participants explored how businesses and multinational corporations engage in fraudulent practices and how some state officials misappropriate public funds.
IFFs refer to illegal transfers of money across borders, violating national and international laws. These activities include corruption, illegal mining, tax evasion, money laundering, and fraudulent financial reporting.
Participants were trained in investigative techniques to uncover and report these issues accurately, with the goal of increasing public awareness and accountability.
Expert insights
Veteran Zimbabwean journalist and former Reuters correspondent Cris Chinaka highlighted the importance of exposing IFFs, which drain billions from Africa each year.
“The money that Africa loses to illicit financial flows is critical to its development. It could be used to address the major challenges we face as a continent—developing schools, improving healthcare services, boosting agriculture and food production, and creating sustainable jobs,” Mr Chinaka emphasised. He underscored the pivotal role of the media in raising public awareness and investigating illicit activities to curb this menace.
Investigating Illicit Flows
During the training, journalists analysed case studies of fund misappropriation across various sectors, including real estate, procurement, and the extractive industries. Reports from Ghana’s Auditor-General and other institutions were used to highlight real-world examples of financial irregularities.
Speaking to GBC News, participants stressed the impact of IFFs on Ghana’s development. They noted that the billions lost annually could be invested in education, healthcare, clean water, and infrastructure projects.
Severity of the issue
According to the UN’s Economic Development in Africa Report (2020), Africa loses an estimated $88.6 billion annually to illicit financial flows, representing 3.7% of the continent’s GDP.
Research by Justice Network Ghana in 2024 estimates that Ghana alone loses around $1.4 billion each year due to financial irregularities and tax-related fraud.
A 2015 Global Financial Integrity report revealed that Ghana lost over $3 billion to trade mis-invoicing in a single year. This included $758 million from import over-invoicing, $722 million from import under-invoicing, $117 million from export over-invoicing, and $1.6 billion from export under-invoicing.
