$18.41b siphoned off thru capital flight in a decade (The Financial Express (Bangladesh))

The country counts millions of dollars in capital flight every year through balance-of-payments leakage and tampering with trade invoicing by some businesses, experts said Sunday at a press meet.

Over the last ten years, according to their reckonings, the country had lost $18.41 billion in capital flight.

Apart from the balance-of-payment leakages and trade misinvoicing, unreported remittances were also listed among the channels through which money is drained out.

The speakers at the press conference demanded strict measures to stop the illicit outflow.

Preventing the smuggling of money abroad is obligatory for the government to augment development, investment and necessary resource mobilisation, they said.

The press meet styled ‘Stop Illicit Finance Flow to Ensure Development, Investment and Revenue mobilisation’ was organised by Equity and Justice Working Group Bangladesh (EquityBD) along with twenty other civil-society organisations (CSOs) at the National Press Club.

Rezaul Karim Chowdhury, chief moderator of Equity BD, coordinated the programme while Ahsanul Karim of the organisation presented the keynote.

The paper revealed that the capital flight from Bangladesh accounted for nearly $1.84 billion year-on-year between 2003 and 2013.

Leakages in balance-of-payments, export and import misinvoicing and unreported remittances were mentioned in the keynote as the tools for capital flight.

Chief executive officer of Online Knowledge Society Prodip K. Roy said Bangladeshi citizens deposited some Tk 32.36 billion in 2013 with Swiss banks in a leap from less than 20 billion in 2012.

He demanded disclosure of the details of such siphoning of money for the sake of transparency.

Chief executive officer of Unnayan Dhara Trust Aminur Rasul Babul said a total of 2,370 Bangladeshi citizens took advantage of the ‘My Second Home’ agenda of Malaysia since 2002.

“Over US$1.5 billion has been transferred to Malaysia for purchase of flats and plots of land,” he said.

Quoting from a UNDP data, Mr. Karim said leakages in the balance-of-payments account for more than 83 per cent of the capital that had gone out of Bangladesh since independence.

He said the amount of losses from balance-of-payments leakage was $977 million in financial year (FY) 2011-12, $764 million in FY’13 and crossed nearly $1.0 billion in FY’14.

An eight-point proposal was placed by the coalition against capital flight that includes making compulsory the submission of details of annual information of banking and assets by the dual-passport holders.

Stern punishment was demanded for those who will be found evading tax.

They also suggested that the government prepare and publish a white paper on the number of Bangladeshis who had taken advantage of Malaysian My Second Home (MM2H) and other citizenship processes through monetary transactions from the country.

One of the suggestions was to sign inter-governmental agreement with different countries, including Switzerland, to exchange bank transaction information of Bangladeshis as well as foreigners working in Bangladesh.

Monitoring the mobile banking process and its financial transactions was also suggested as smugglers now allegedly use mobile banking in human trafficking.