Two numbers tell the story in a nutshell:

1. The amount of American financial aid received by the then Ethiopia’s government since 1991 to 2015: $30 billion.

2. The amount stolen by Ethiopia’s leaders since 1991 to 2015: $30 billion.


UN 2015 report demonstrate on Illicit Financial Outflows by a panel chaired by former South African President Thabo Mbeki and another from Global Financial Integrity, an American think tank. These document $2-3 billion—an amount roughly equaling Ethiopia’s annual foreign aid and investment—being drained from the country every year, mostly through over- and under-invoicing of imports and exports.

Although the term emerged in the 1990s and was initially associated with the notion of capital flight, it has evolved into a concept that captures the cross-border movement of capital associated with illegal activities or, as defined by Global Financial Integrity (GFI).

According to GFI’s estimations, between 2005 and 2014, an estimated average of US$1,259 million to US$3,153 million dollars left Ethiopia as IFFs every year. This is equivalent to:

·       11% to 29% of the country’s total trade (GFI 2017)

·       40% to 97% of the total aid inflows to the country (OECD 2016, own calculations)

·       10% to 30% of the government’s total revenue (IMF 2016, own calculations)

Additionally, Alemayehu and Addis (2017) estimate that the levels of capital flight from the country, which include IFFs, have led to an average loss of 2.2 percentage points per year for the case of Ethiopia. They also estimate that had it not been for capital flight, poverty would have been reduced by about 2.5 percentage points in the last decade (Almenyahu and Addis 2017).



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