PARIS, June 8, 2010 — The World Bank Group and the Government of Switzerland today called for concerted action against plundering of developing countries. Much of the money stolen from them finds safe haven in international financial centers. Failing to stem and reverse these criminal flows contributes to the impoverishment of the world’s poorest countries.
Some US$20 – US$40 billion (about 16.2 billion - 32.4 Euros) is stolen from developing countries every year through bribery, misappropriation of funds and corrupt practices. The World Bank estimates that with US$20 billion, developing countries would be able to finance 48,000 km of two-lane paved roads, or first line treatment for 120 million people with HIV/AIDS for a full year, or some 50 million water connections for households.
“Billions of dollars are stolen every year from the developing countries, robbing them of economic opportunities,” said World Bank Group Managing Director Ngozi Okonjo-Iweala. “As world leaders convene at the G20 meetings and other fora in the coming weeks to discuss the economic crisis, stimulus plans and financial regulation, the fight against corruption and asset theft should be at the top of their agenda.”
For the Head of the Swiss Federal Department of Foreign Affairs Micheline Calmy-Rey, “corruption is one of the central stumbling blocks for development. This is why Switzerland takes a leading role in recovering stolen assets. So far, we have given back US$1.6 billion to their country of origin,” emphasized the Swiss Federal Councillor.
Okonjo-Iweala and Calmy-Rey spoke at the launch of the conference No Safe Havens: A Global Forum for Stolen Asset Recovery and Development, taking place June 8 -9 in Paris. At the conference, corruption fighters from around the world are addressing the problem of safe havens for the proceeds of corruption, money laundering, lack of financial oversight, and the way forward to prevent further plundering of developing countries.
The first ever global forum to focus on asset theft and development is co-sponsored by the Stolen Asset Recovery Initiative (StAR) --a partnership between the World Bank and the United Nations Office on Drugs and Crime (UNODC)-- and the Government of Switzerland.
The World Bank Group Managing Director and the Swiss Foreign Minister called for both developed and developing countries, and the private and public sector, to collaborate in the fight against corruption. They urged countries to ratify and implement the United Nations Convention against Corruption (UNCAC), stressing the importance of its provisions on legal collaboration and asset recovery.
According to the Executive Director of the UNODC, Antonio Maria Costa, "the world is well equipped with UNCAC to prevent and reverse the flows of ill-gotten gains, as it is the only global legal instrument with detailed and innovative provisions on asset recovery.” Therefore, he added, “the Convention needs to be fully implemented and to be actively supported, especially by financial centers."
Okonjo-Iweala and Calmy-Rey asked that financial centers take the initiative in pursuing domestic and foreign corruption cases. The Financial Action Task Force, the international body that combats money laundering and the financing of terrorism, can play an important role in this regard by applying its tools and standards in the fight against corruption.
Referring to the financial sector, they called on banks and other financial institutions to take their responsibility to conduct customer due-diligence seriously, and take the initiative in detecting and reporting the suspected proceeds of corruption.
The private sector can go further by issuing, for instance, voluntary guidelines on anti-corruption.
“The private sector has a very special role to play,” Okonjo-Iweala said. “Corruption is a major impediment to investment. So as we forcefully go after the bribers, responsible businesses should also eliminate corrupt practices.”
And “because we are all part of the problem, we must also all be part of the solution,” emphasized Calmy Rey. Therefore, “we have to work together to ensure that corruption does no longer undermine development.”
About the Stolen Asset Recovery Initiative (StAR)
StAR is a partnership between the World Bank Group and the UNODC that supports international efforts to end safe havens for corrupt funds. StAR works with developing countries and financial centers to prevent the laundering of the proceeds of corruption and to facilitate a more systematic and timely return of stolen assets to their country of origin.