Introductory remarks by Angel Gurría,
19 April 2016,
Your Excellency President Mbeki,
Distinguished members of the Panel,
It gives me great pleasure to welcome His Excellency Thabo Mbeki back to the OECD, along with colleagues from the High-Level Panel on Illicit Financial Flows from Africa. As you know, this is Integrity Week at the OECD and we are still amidst the aftershock of the Unaoil scandal and the Panama Papers. Your visit, Mr. President, could not be more timely.
When President Mbeki last visited the OECD two years ago, we spoke at length of the challenges presented by illicit flows for African countries. Of the brake that they put on development and poverty reduction. And of the importance of addressing them if we are serious about enabling African governments to mobilise their own resources for development.
Since then, the Panel released its report, informing successful outcomes in both Addis Ababa, and at the SDGs Summit in New York last September. Congratulations, Mr President.
SDG 16 could not be clearer: the international community has committed itself to reducing illicit flows significantly by 2030, to strengthening the recovery and return or stolen assets, and to combating all forms of organised crime. There are also commitments to address corruption and bribery, and to develop effective and accountable institutions.
Excellencies, ladies and gentlemen,
The Panama Papers have shone a light on the ongoing risks posed by jurisdictions which do not commit to, and do not effectively implement, international tax transparency and anti-corruption standards. It has also laid bare the role that professional enablers – such as lawyers, accountants, financial institutions, corporate and trust service providers – play in maintaining a shroud of secrecy over illicit activities such as tax evasion, money laundering and corruption.
Mr President: I welcome your statement following the release of the Panama Papers. Together, we must keep up the pressure on those countries that enable financial opacity, or that have laws enabling banking secrecy and the registration of shell companies. As your work has shown, the impact of these practices is felt globally and, quite often, in some of the world’s poorest countries.
The only real solution to these challenges is to ensure transparency of financial flows and specifically on beneficial ownership. This effort cannot only be led by Africa – it involves each and every member of the OECD too.
In 2014, we released a report on how our member countries are doing in countering illegal flows from developing countries. We measured their performance against international standards on money laundering, tax evasion, bribery and asset recovery.
In the area of tax transparency, there has been significant progress in the past seven years driven by the OECD’s work to establish global standards that ensure government authorities have access to the information they need to detect and investigate tax and other financial crimes.
But while those standards are robust, they are not enough. Without global adoption and effective implementation, they will remain as lifeless as the papers on our shelves.
Taking the next step on tax transparency requires several things:
Your Excellency, dear colleagues,
The concerns of African countries are very close to our heart. We work very closely with African governments in many ways, for example:
Finally, I know that President Mbeki and the Panel have an interest in addressing the issue of large multinationals which strip African countries of much needed revenues through artificial arrangements that result in Base Erosion and Profit Shifting (BEPS). Unlike some of the other challenges I’ve discussed, the BEPS challenges are about companies using and abusing legal loopholes to avoid paying tax. But it doesn’t make them any more desirable. That’s why the OECD launched the BEPS Project and has now created an inclusive framework to support implementation and tackle the remaining technical issues. It is open to all countries on an equal footing and will meet for the first time in June. We are also very proud to be working with African countries as they develop tax audit capacity through the Tax project, in partnership with UNDP.
In short: the OECD is committed to doing its part. I look forward to hearing President Mbeki’s thoughts on these issues and others.
President Mbeki: please keep pushing us to do more for Africa! The floor is yours.