By Lalit K Jha, Business Today
The G-20 summit in Australia failed to make
substantial progress on financial transparency and illicit flows, an eminent
international think-tank famous for its pioneering work on black money has
claimed.
"The G20 passed up a golden
opportunity to begin tackling this global scourge by curbing the abuse of
anonymous companies and instituting public country-by-country reporting for
multinational corporations," said Raymond Baker, president, Global
Financial Integrity (GFI).
Considered to be a longtime authority on
financial crime, Baker had recently co-authored an open letter to G20 leaders
on the topic prior to the summit.
"Illicit financial flows, fuelled by
anonymous companies and tax haven secrecy, undercut economic growth and tax
revenues, drain roughly $1 trillion per year from developing and emerging
countries and facilitate crime and corruption on a grand scale," Baker
said.
G20 summit noticeably lacked in responses
to illicit
financial flows, one of the largest drags on development worldwide,
a statement said.
The GFI has long advocated for basic
financial transparency measures to hinder common methods of moving illicit
money, specifically, public registries of company ownership information, public
country-by-country reporting, and global automatic exchange of financial
information.
All of these issues have enjoyed a
worldwide surge of public momentum in recent years, but the G20's statements
this weekend fell short of capitalising on this movement, the statement said.
According to the GFI, the G-20 commitment
to automatic exchange of tax information is welcome but incomplete.
"While this is a welcome culmination
of the G20's long track record of leadership on automatic exchange, the G20
failed to address the extension of tax information exchange to the other 100+
countries in the world," it said.
"For a couple of years, the G20 has
declared that automatic exchange of financial information is 'the new global
standard' and now we are proudly seeing that claim come to fruition," said
GFI Policy Counsel Joshua Simmons.
"However, it's critical that the new
framework for making information exchange a reality is able to accommodate the
world's poorest countries, who suffer the effects of tax evasion and money
laundering at least as much as and often substantially more than rich
countries," he added.
