By Elizabeth Hearst
Up to €5.5 Trillion could be lost from poorer countries over the next ten years as a result of illegal activities including money laundering and drug trafficking.
Research conducted by Tony Daly, coordinator of 80:20 Educating and Acting for a Better World, in conjunction with Dr. Colm Regan from the University of Malta describes that for every €1 a poor country receives in foreign aid, €5 leaves the country.
This research highlights that total official aid given to poorer countries in a single year amounts to €122.4 Billion, whereas funds flowing out of these countries is estimated to be worth a whopping €645.5 Billion.
The scale of this disparity is “utterly indefensible” according to Dr. Regan and Daly, with some of the money flowing out of these countries destined for international drug trafficking and financial investment schemes.
Dr. Regan and Daly estimate that in the 59 lowest-income countries, the cost of healthcare would be €188.5 Billion, maternity, disability and illness payment would cost €87 Billion and education for all levels is estimated to cost €216 Billion.
The authors detail that between 2014 and 2018, more than $1 Trillion flowed legally from developing countries to developed ones, with estimates that illegal transfers were nearly double that, accounting for at least €2 Trillion. However, the authors believe that these illicit transfers could have been as high as €7.3 Trillion.
The researchers believe that this gap in funding results in decreased investment and expenditure in vital services for some of the world’s poorest people. They added that this system promotes and supports corruption, criminality, money laundering, and tax evasion.
Should this continue, the authors believe that some of the poorest nations will be hit with a net loss of “at least €5.5 Trillion by 2030”, which they believe “translates into fewer hospitals, doctors, teachers, roads and water and sanitation services”.
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