Corruption deprives developing countries of at least one trillion US dollars (£600 billion) a year, according to a new report from anti-poverty charity One.
The charity said as many as 3.6 million deaths could be prevented each year if action was taken to stop cash from business activities in poor countries – including the extraction of oil, gas and minerals – being illegally siphoned off.
It called on rich nations gathering in Australia for the G20 summit in November to agree steps to crack down on “shady” deals to exploit the natural resources of the world’s poorest countries, the use of phantom firms, money laundering and tax evasion.
The report, entitled Trillion Dollar Scandal, estimated that in sub-Saharan Africa alone, this could deliver sufficient extra resources each year for governments to educate an additional 10 million children, pay for 500,000 extra primary school teachers, provide anti-retroviral drugs for more than 11 million people living with HIV/Aids and buy almost 165 million vaccines.
David McNair, transparency and accountability policy director at One, said: “In developing countries, corruption is a killer. Up to 3.6 million lives could be saved if we end the web of secrecy that helps the criminal and corrupt. When governments are deprived of their own resources to invest in the essentials – like nurses and teachers – the human cost is devastating.”
One is urging the G20 nations to take action on:
:: Making information about the true ownership of companies public, in order to prevent the use of anonymous phantom firms to conceal the identities of corrupt individuals and businesses;
:: Introduction of tough “publish what you pay” rules in the oil, gas and mining sectors to increase transparency about where the destination of the proceeds from exploitation of natural resources;
:: Automatic exchange of tax information so that developing countries have the information they need to collect taxes they are due; and
:: Publication of government data so that citizens can follow the money and hold the authorities to account for the delivery of essential services.
Anti-corruption campaigner John Githongo, chief executive of the Inuka Kenya Fund, said: “For too long, G20 countries have turned a blind eye to massive financial outflows from developing countries which are channelled through offshore bank accounts and secret companies.
“Introducing smart policies could help end this trillion dollar scandal and reap massive benefits for our people at virtually no cost. The G20 should make those changes now.”