Has Najib got a plan against capital flight?

By admin-s Last updated Dec 16, 2014

On average, we have been losing US$39.49bn (RM138bn) yearly for the past 10 years. We now stand fifth on the list of 151 developing and emerging countries, behind China, Russia, Mexico and India, facilitating crime, corruption, and tax evasion with these illegal outflows. We were ranked fourth in 2011.

K. Kabilan, The Ant Daily

Malaysia suffered a loss of US$48.93bn (RM171bn) in dirty money in 2012, said international anti-corruption group Global Financial Integrity (GFI) in a report released on Dec 15.

In 2011, Malaysia’s loss of capital through illegal channels was US$54.1bn (RM188bn). The report also revealed that the accumulated total of illicit outflows from Malaysia from 2003 to 2012 stood at US$394.87bn, or a whopping RM1.3 trillion at today’s exchange rate of RM3.50 for a dollar.

While there seems to be some improvement – by about US$7bn, this is not something Malaysians can be proud of. We are losing money in a big scale, and we have been losing vast amounts for years now.

Based on GFI’s report, our total loss to illicit flows was US$19.7bn in 2002. It grew to US$35.2bn in 2005. Four years later, in 2009, it stood at US$34.5bn. It then had a drastic jump to US$64.5bn in 2010.

This is money we all wish had been invested for the betterment of the nation in sectors such as healthcare, education, infrastructure or even nation building. Imagine what it could have done for our overall economic growth and how it could have helped towards creating a strong, balanced budget. For that matter in strengthening the value of the ringgit.

According to GFI, a record US$991.2bn in illicit capital flowed out of developing economies in 2012. What is alarming is that these outflows were greater than the combined sum of all foreign direct investment (FDI) and official development assistance (ODA) that flowed into these countries in 2012.