Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries

Despite the substantial recent increase in capital flows to sub-Saharan Africa (SSA), the sub-continent remains largely marginalized in financial globalization and chronically dependent on official development aid. The current debate on resource mobilization for development financing in Africa has o...

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Main Authors:	Fofack, Hippolyte, Ndikumana, Leonce
Format:	Journal Article
Language:	EN
Published:	2012
Subjects:	International Investment Long-term Capital Movements F210 Current Account Adjustment Short-term Capital Movements F320 Foreign Aid F350 Economic Development: Financial Markets Saving and Capital Investment Corporate Finance and Governance O160 International Linkages to Development Role of International Organizations O190
Online Access:	http://hdl.handle.net/10986/5744

id	okr-10986-5744
recordtype	oai_dc
spelling	okr-10986-57442021-04-23T14:02:23Z Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries Fofack, Hippolyte Ndikumana, Leonce International Investment Long-term Capital Movements F210 Current Account Adjustment Short-term Capital Movements F320 Foreign Aid F350 Economic Development: Financial Markets Saving and Capital Investment Corporate Finance and Governance O160 International Linkages to Development Role of International Organizations O190 Despite the substantial recent increase in capital flows to sub-Saharan Africa (SSA), the sub-continent remains largely marginalized in financial globalization and chronically dependent on official development aid. The current debate on resource mobilization for development financing in Africa has overlooked the problem of capital flight, which constitutes an important untapped source of funds. This paper argues that repatriation of flight capital deserves more attention on economic as well as moral grounds. On the moral side, the argument is that a large proportion of the capital flight legitimately belongs to the African people and therefore must be restituted to the legitimate claimants. The economic argument is that repatriation of flight capital will contribute to propelling the sub-continent on a higher sustainable growth path while preserving its financial stability and independence and without mortgaging the welfare of its future generations through external borrowing. The anticipated gains from capital repatriation are large. In particular, this paper estimates that if only a quarter of the stock of capital flight was repatriated to SSA, the sub-continent would go from trailing to leading other developing regions in terms of domestic investment. The paper proposes some strategies for inducing capital flight repatriation, but cautions that the success of this program is contingent on a strong political will on the part of African and Western governments and effective coordination and cooperation at the global level. 2012-03-30T07:34:20Z 2012-03-30T07:34:20Z 2010 Journal Article African Development Review/Revue Africaine de Developpement 10176772 http://hdl.handle.net/10986/5744 EN http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Journal Article Africa
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	EN
topic	International Investment Long-term Capital Movements F210 Current Account Adjustment Short-term Capital Movements F320 Foreign Aid F350 Economic Development: Financial Markets Saving and Capital Investment Corporate Finance and Governance O160 International Linkages to Development Role of International Organizations O190
spellingShingle	International Investment Long-term Capital Movements F210 Current Account Adjustment Short-term Capital Movements F320 Foreign Aid F350 Economic Development: Financial Markets Saving and Capital Investment Corporate Finance and Governance O160 International Linkages to Development Role of International Organizations O190 Fofack, Hippolyte Ndikumana, Leonce Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries
geographic_facet	Africa
relation	http://creativecommons.org/licenses/by-nc-nd/3.0/igo
description	Despite the substantial recent increase in capital flows to sub-Saharan Africa (SSA), the sub-continent remains largely marginalized in financial globalization and chronically dependent on official development aid. The current debate on resource mobilization for development financing in Africa has overlooked the problem of capital flight, which constitutes an important untapped source of funds. This paper argues that repatriation of flight capital deserves more attention on economic as well as moral grounds. On the moral side, the argument is that a large proportion of the capital flight legitimately belongs to the African people and therefore must be restituted to the legitimate claimants. The economic argument is that repatriation of flight capital will contribute to propelling the sub-continent on a higher sustainable growth path while preserving its financial stability and independence and without mortgaging the welfare of its future generations through external borrowing. The anticipated gains from capital repatriation are large. In particular, this paper estimates that if only a quarter of the stock of capital flight was repatriated to SSA, the sub-continent would go from trailing to leading other developing regions in terms of domestic investment. The paper proposes some strategies for inducing capital flight repatriation, but cautions that the success of this program is contingent on a strong political will on the part of African and Western governments and effective coordination and cooperation at the global level.
format	Journal Article
author	Fofack, Hippolyte Ndikumana, Leonce
author_facet	Fofack, Hippolyte Ndikumana, Leonce
author_sort	Fofack, Hippolyte
title	Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries
title_short	Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries
title_full	Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries
title_fullStr	Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries
title_full_unstemmed	Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries
title_sort	capital flight repatriation : investigation of its potential gains for sub-saharan african countries
publishDate	2012
url	http://hdl.handle.net/10986/5744
_version_	1764396153102663680

Capital Flight Repatriation : Investigation of Its Potential Gains for Sub-Saharan African Countries

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