GVG CEO: How Africa can leverage digital technology to combat illicit financial flows

Africa is losing almost 10 billion US dollars a year due to illicit activities born of technological variants such as mobile phones or the internet, according to Global Voice Group. Ironically, technology is also the most powerful medicine to heal the African economy. James Claude, the CEO of Global Voice Group, emphasized the importance of finding a balance between leveraging digital technology to combat illicit financial flows and fostering economic development. He highlighted the significant impact of illicit activities on the African economy, with more than 10 billion US dollars lost last year alone. Claude suggested that government authorities and regulatory bodies need to adopt solutions that can effectively fight against these illicit flows while creating a conducive environment for economic growth. One example he provided was Rwanda, which increased its tax collection by 6% by using digital technologies. These tools can provide insights for tax authorities and regulatory bodies to better understand and monitor their respective sectors. Claude emphasized the need for joint efforts among stakeholders, including service providers and regulatory bodies, to implement proper revenue assurance tools and ensure ecosystem protection. He also called for innovative approaches to tax collection, such as applying micro levies on specific sectors to expand the tax base. Additionally, Claude highlighted the issue of ghost workers in East Africa, citing cases where governments discovered more than 10,000 ghost workers. He proposed the use of digital technologies, like digital identities and mobile money, to track payments and prevent such fraudulent activities. Global Voice Group has been offering solutions to help governments tackle these challenges effectively. Overall, Claude emphasized the transformative power of digital technology in fighting illicit financial flows and promoting economic development in Africa.