African governments should improve legal frameworks in combating Illicit Financial Flows – Report
15Apr’25
An audit report on Illicit Financial Flows (IFFs) has recommended that African governments should improve their legal framework to enhance transparency and policy coherence to curb IFFs. It further recommends that the governments should implement policies and mechanisms to ensure a high level of integrity among those responsible for mobilising tax revenues.
The report by 12 Supreme Audit Institutions (SAIs) under the banner of African Organisation of Supreme Audit Institutions (AFROSAI), launched in Nairobi, marks a significant step in strengthening financial oversight and governance across the continent.
The audit established those African administrations lack transparency in the implementation of preventive measures to combat IFFs, particularly in the extractive industries, and those legal frameworks are not always consistent or harmonised, allowing multinational companies to exploit legal loopholes to avoid tax. According to the report inconsistencies and shortcomings in tax laws and regulations and transfer pricing practices have been identified in several countries, posing a major challenge in the fight against IFFs.
Participating SAIs included those of Botswana, Burkina Faso, Cameroon, Comoros, The Gambia, Gabon, Guinea, Kenya, Senegal, Tanzania, Uganda, and Zambia. The audit was coordinated by AFROSAI’s Institutional and Technical Capacity Building Committee and supported by the GIZ Good Financial Governance in Africa Programme.
Africa estimates that illicit financial flows cost it over USD 88.6 billion annually, resources that could otherwise support critical development needs. The report identifies weaknesses in transparency, inconsistent legal regimes, limited international cooperation, and a lack of integrated systems among tax, customs, and financial intelligence agencies.
The coordinated audit builds on a resolution by AFROSAI’s Governing Board to support joint initiatives that strengthen public accountability and safeguard national revenues. It is the second such audit following a 2017 regional exercise focused on corruption in public procurement and asset declaration.
The launch of this report not only strengthens Africa’s collective voice in the global fight against illicit financial flows but also provides a data-driven roadmap for reform and sustained institutional collaboration.