In: Bjelić, P., Kastratović, R., & Rajković, M. (2023). Global Illicit Trade and Illicit Financial Flows, 18th SCF International Conference on "Sustainable Development in a Global Perspective" (Ed. Yilmaz Bayar) Antalya/Turkiye, 14-17th October 2023, pp. 32-48
The emerging concept of illicit financial flows has become a crosscutting issue on the international agenda in recent years. This umbrella term refers to money illegally earned, transferred, or used. With the development of digital technologies, the use of information and communications networks as a tool for facilitating illicit financial flows is rising as one of the key challenges in tackling the problem of the movement of illegal funds. Digital technologies facilitate illicit financial flows at each stage, be it earning money illegally, transferring illegal funds, or using them. There are several areas where clear links between technology and illicit financial flows can be established. Part one defines illicit financial flows to establish the scope of the problem and provide the context for further analysis. Part two focuses on the issue of digital technologies in the process of earning money illegally and transferring illicit funds, and analyzes how technology can help in the process of acquisition, transfers, and integration of illicit finds. Part three discusses the role of technology in fighting illicit financial flows. Part four concludes with suggestions for further areas of research in this field and ways to tackle the problem more effectively.
Illicit Financial Flows (IFFs) have received increased attention in light of international corruption scandals, high-profile leaks about extensive tax abuse schemes, and the continued fight against terrorism financing and organized crime. Reducing IFFs is now a key target of the UN Sustainable Development Goals, renewing debates about both how to operationally define IFF and the methodologies that are used to estimate their extent. This book addresses these key issues, by investigating and schematizing the concept of illicit financial flows and critically evaluating the current models used to estimate them. It book proposes an original flow-network approach through which to produce longitudinal and country-specific estimates of IFFs and the gross value added related to transnational trafficking. It advocates for a reformulation of the current definition of IFFs to one that is more specific and operational, allowing scholars and policy-makers to better clarify the relationship between IFFs, the sources of capital and the channels that are used to move capital abroad. This brief will be an indispensable guide for students of criminology and organized crime, and for the researchers and practitioners working to understand and combat these crimes.--
Official estimates of migrants' remittances are around US$100 billion annually, with some 60 per cent going to developing countries. Any policy making use of migrants as a development resource must understand the size and allocation of remittances, and the roles played by migrants and their communities in the remittance process. This paper examines the flows of remittances in relation to other financial flows to developing countries. The examination is based on data available from official statistics. As discussed in the paper, remittances by unofficial channels are significant by all accounts so the remittance amounts reported here are quite conservative.The paper shows that annual remittances to developing countries have more than doubled between 1988 and 1999. Viewed over the last decade, remittances have been a much larger source of income for developing countries than official development assistance (ODA). The gap is increasing, since ODA has been falling while remittances have increased. Furthermore, remittances appear to be a much more stable source of income than private flows, both direct and portfolio, which tend to be more volatile and flow into a limited set of countries.Remittances to developing countries go first and foremost to lower middleincome and low–income countries. Lower middle–income countries receive the largest amounts, but remittances constitute a much higher share of total international flows to low–income countries. Of the ten countries receiving most remittances, two are low–income (India and Pakistan); six are lower middle–income (Philippines, Turkey, Egypt, Morocco, Thailand, and Jordan); and two are upper middle–income (Mexico and Brazil).Sub–Saharan Africa received some 8 per cent of remittances in 1980, but only some 4 per cent in 1999. South Asia's share also declined from what was already a relatively high 34 to 24 per cent. Those who gained most were Eastern Europe and Central Asia, South and Central America, and the Caribbean, which increased their share of global remittances.
After decades of billion dollar scandals around long-serving dictators removing vast fortunes from their impoverished nations, the broader phenomenon of which this is part has acquired a label: Illicit Financial Flows (IFFs). The term encompasses the international transfer of moneys generated by bribery, tax evasion and illegal markets. IFFs have been the object of much attention from high level bodies such as the G20 and G7. The purpose of this Note is to develop a better understanding of the drivers of the phenomenon itself in terms of governance and also of the governance challenge in trying to reduce IFFs. It deals with the distribution of power as a factor in both aspects. The discussion does not examine the drivers or consequences of the activities that generate most IFFs, such as bribery and tax evasion. Thus a statement that IFFs from criminal earnings does not affect development institutions is not a statement about the adverse effects of a large criminal sector, which may indeed have very serious economic and development consequences. The paper deals only briefly with the contested issues of definition and measurement. This paper has been relentlessly speculative that reflects the state of understanding of the IFF phenomenon. For reform efforts, a good understanding of the governance issues and the obstacles to aligning the interests and capacities of the many participants is crucial.
During the 1980s, interest in money & finance was sparked for the first time among human geographers for a number of reasons: (1) the dynamic worldwide expansion of financial institutions, services, & networks; (2) negative side-effects of financial booms in both developing & developed countries; & (3) emerging geography of finance & money as central to the world economies. One approach to the geography of finance focuses on monetary exchange, credit, & debt, with a particular interest in illuminating the relationships between nations, states, & financial institutions. Another approach emphasizes urban centers' primacy to modern financial flows & examines the complex & overlapping networks that link world cities & their financial institutions. A third approach addresses financial exclusion & the growth of alternative financial structures & economies in recent decades. A synthesis of these approaches suggests that modern economic geographies are shaped by monetary institutions operating in well-defined urban locations, which results in the exclusion of many people from many parts of the world. The future directions of finance-oriented human geography are briefly considered. 1 Photograph, 31 References. Adapted from the source document.
This article examines the impact that external financial flows have on gross domestic product (GDP) growth in a new, small, and open economy—the Republic of Kosovo. Remittances, foreign direct investment (FDI), foreign debt, and net exports may affect GDP in different ways. In the context of a new, small, and open economy, these factors can be important determinants of economic development. This article examines the direct effect of these factors on economic development as represented by GDP growth in Kosovo, covering the period of 2012–2018. The relationships between remittances, net exports, FDI, external debt, and GDP are modeled based on theoretical arguments and empirical evidence. The results suggest that in Kosovo, remittances are the leading contributor to GDP growth. This contribution could be more valuable if remittances were invested in the manufacturing sector. These investments could have positive effects on job creation, thereby reducing the unemployment rate and Kosovo's dependence on imports.
African countries have experienced modest economic recovery during the 1990s. But these countries are caught in a vicious circle in which the existing economic structure cannot generate enough savings and export earnings needed to finance their development and mount a sustained assault on widespread poverty. Yet foreign aid has been cut back sharply and the continent receives only a trickle of foreign investment flows. New policy regimes are now in place, creating the right environment for external financing to make a major difference. Development finance is one of the foremost challenges faci