The Minister of Finance and Coordinating Minister for the Economy, Wale Edun, and the Executive Chairman of the Nigeria Revenue Service (NRS), Zacch Adedeji have called for urgent and coordinated reforms to checkmate capital flight, strengthen domestic resource mobilisation, and reposition African economies for sustainable growth.
They spoke separately on Tuesday at the opening of the 5th Session of Sub-Committee on Tax and Illicit Financial Flows of the Specialised Technical Committee on Finance, Monetary Affairs, Economic Planning and Integration (STC-FMAEPI) hosted by the NRS under the auspices of the African Union (AU).
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The three-day event which is holding at the Congress Hall of Transcorp Hilton Hotel, Abuja ends on 2 April. Apart from top officials of the Nigerian government led by the Minister of Finance, other top attendees include members of the African Union subcommittees on Tax and Illicit Financial Flows, ambassadors and representatives of diplomatic missions, heads of revenue, representatives of regional economic communities, and partners from international and regional organisations.
The NRS Chairman, in his welcome address, said the future prosperity of Africa will depend significantly on its ability to build strong fiscal institutions, protect its financial resources, and mobilise the revenues required to finance development from within African countries’ own economies.
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The Finance Minister said Nigeria was tackling the menace of illicit funds flow through diverse measures, including strengthened transparency and accountability in the management of natural resource revenues. He said President Bola Tinubu signed Executive Order 9 that stipulates that all oil and gas revenues are remitted into constitutionally designated accounts prior to disbursement.
In addition, Mr Edun said the removal of fuel subsidies and the unification of the exchange rate have significantly improved fiscal transparency, reduced distortions, and strengthened investor confidence. He said Nigeria was focused on fiscal reforms, tax administration, and strategies to combat illicit financial flows, widely seen as a major drain on Africa’s economic potential.
To further enhance trade efficiency and reduce leakages, he said Nigeria recently launched a National Single Window system—an important step in tackling trade-based illicit financial flows.
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Mr Edun said that Africa is losing billions of dollars annually to illicit financial flows, a trend that continues to undermine development efforts across the continent.
Describing the present era as a defining moment for Africa’s economic future, the minister said “the question is no longer whether we will reform, but how urgently and how boldly we are prepared to act.”
He stressed that Africa, with a population of over 1.4 billion people and vast natural resources, has the capacity to drive its own development but must reduce its dependence on external financing. He stated that reliance on debt, aid, and foreign investment alone is no longer sustainable in an increasingly uncertain global environment.
“Africa cannot sustainably finance its development through debt, aid, or external investment alone,” Mr Edun said. “We must mobilise domestic resources and build resilient economies that can withstand global shocks,” he added.
He highlighted ongoing reforms in Nigeria under President Bola Tinubu, including efforts to stabilise the macroeconomic environment, improve investor confidence, and overhaul the tax system.
Mr Edun said the reforms are already beginning to yield results, pointing to improvements in economic stability and renewed investor interest. He added that Nigeria’s approach could serve as a model for other African countries seeking to implement similar changes.
Central to the discussions at the well-attended event was the scale of illicit financial flows, which Mr Edun restated at about $88bn annually across Africa, adding that the resources could otherwise be channelled into infrastructure, healthcare, education, and job creation.
“These are funds that should be building roads, schools, and hospitals,” he said. “Instead, they are lost through illegal transfers, tax evasion, and other financial leakages.”
Mr Edun also pointed to the African Union’s Agenda 2063 as a guiding framework for the continent’s development, noting its emphasis on domestic resource mobilisation, improved tax systems, and stronger financial governance.
The agenda, he said, sets an ambitious target of financing up to 90 per cent of Africa’s development needs through domestic resources.
Achieving this goal, however, will require deep structural reforms, including strengthening public financial management, expanding capital markets, and promoting financial inclusion.
The NRS chairman, Dr Adedeji, in his address, further emphasised that: “the central purpose of our gathering, illicit financial flows, remains one of the most pressing threats to Africa’s economic progress.
“Every year, billions of dollars that should support development across our continent are diverted through illegal financial transfers, trade mispricing, tax evasion, and opaque corporate structures.
“These outflows represent lost opportunities, lost hospitals, lost schools, lost infrastructure, and lost investments in the future of our people. The scale of the problem was highlighted in the influential High-Level Panel on Illicit Financial Flows from Africa Report, which brought global attention to the magnitude of financial leakages affecting African economies.
“Nigeria has proactively responded in various ways to the Mbeki Panel Report findings and other policy recommendations aimed at tackling IFFs as you will find out from subsequent plenary sessions. Suffice to say for now that addressing these challenges require coordinated action across multiple fronts within our national systems and at continental levels.
“Illicit financial flows, being inherently transnational in nature, exploit differences between jurisdictions and weaknesses in international regulatory systems. This is why continental cooperation through platforms such as this Subcommittee is not only useful but indispensable.
“The future prosperity of Africa will depend significantly on our ability to build strong fiscal institutions, protect our financial resources, and mobilise the revenues required to finance development from within our own economies.
This meeting represents an important step in that journey. As you begin your deliberations, I encourage you to engage openly, share experiences generously, and proffer solutions that strengthen cooperation across our continent and enable us tackle the malaise of IFFs in our respective countries.
“Together, through collaboration and shared commitment, we can advance the reforms necessary to safeguard Africa’s resources and build the resilient economies that our people deserve,” Dr Adedeji stressed.
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