>>4361>Vietnam got raped worse than any other country.
Vietnam is still socialist, they havent been couped, then bribed to take on massive loans with huge interest.
>Finland got raped their entire history until about 100 years ago.
I dont know enough about the economical history of Finland
<Now lets go to Africa:
In 2012, the last year of recorded data, developing countries received a total of $1.3tn, including all aid (125bn dollars), investment, and income from abroad. But that same year some $3.3tn flowed out of them. In other words, developing countries sent $2tn more to the rest of the world than they received. If we look at all years since 1980, these net outflows add up to an eye-popping total of $16.3tn – that’s how much money has been drained out of the global south over the past few decades. To get a sense for the scale of this, $16.3tn is roughly the GDP of the United States
What this means is that the usual development narrative has it backwards. Aid is effectively flowing in reverse. Rich countries aren’t developing poor countries; poor countries are developing rich ones.
What do these large outflows consist of? Well, some of it is payments on debt. Developing countries have forked out over $4.2tn in interest payments alone since 1980 – a direct cash transfer to big banks in New York and London, on a scale that dwarfs the aid that they received during the same period. Another big contributor is the income that foreigners make on their investments in developing countries and then repatriate back home. Think of all the profits that BP extracts from Nigeria’s oil reserves, for example, or that Anglo-American pulls out of South Africa’s gold mines.
Most people blame the loss of money on "corruption"
There is certainly no denying that corruption is a problem.
According to the World Bank, corruption in the forms of bribery and theft by government officials, the main target of the UN Convention, costs developing countries between $20 billion and $40 billion each year .
That’s a lot of money – and this figure is certainly large enough to warrant our attention as an obstacle to development. But if we broaden our view a little bit and put this figure into perspective, a very different story emerges. As it turns out, this kind of corruption is an extremely small proportion – only about 3 percent – of the total illicit flows that leak out of the developing world each year.
By contrast, the Washington-based Global Financial Integrity (GFI) calculates that up to 65 percent of total illicit outflows have to do with corruption of a very different sort: commercial tax evasion. And when we look at commercial tax evasion, the neat corruption narrative that Transparency International tells begins to fall apart.
But by far the biggest chunk of outflows has to do with unrecorded – and usually illicit – capital flight. GFI calculates that developing countries have lost a total of $13.4tn through unrecorded capital flight since 1980.
‘Illicit outflow’ is just a fancy name for any illegal movement of money from one country to another. It could be a corrupt official siphoning public funds into a secrecy jurisdiction, or it could be a multinational corporation shifting their money offshore in order to avoid paying taxes. There are lots of reasons that people spirit money across borders.
According to GFI, each year up to $1.1 trillion flows illegally out of developing countries and into foreign banks and tax havens. This is an almost unimaginable sum – more than the total amount of foreign direct investment that developing countries receive each year ($858 billion in 2013), and eleven times the amount of official aid they receive ($99.3 billion in 2013). And these outflows have been increasing at a rapid pace over the past decade, growing at about 6.5 per cent per year.
Between 2004 and 2013, developing countries lost a total of $7.8 trillion to illicit outflows. It’s an enormous problem. How does this happen? These illicit outflows work through two main channels: hot money and trade misinvoicing. Basically, corporations – foreign and domestic alike – report false prices on their trade invoices in order to spirit money out of developing countries directly into tax havens and secrecy jurisdictions, a practice known as “trade misinvoicing”. Usually the goal is to evade taxes, but sometimes this practice is used to launder money or circumvent capital controls. In 2012, developing countries lost $700bn through trade misinvoicing, which outstripped aid receipts that year by a factor of five.
>In 2013, hot money accounted for 19.4 per cent of total illicit outflows from developing countries, or $211 billion.
Hot money is a term used to describe the rapid movement of capital from one country to another in order to speculate on interest-rate and exchange-rate differences. For example, if the United States looks likely to raise its interest rates, someone with investments in Nigeria might rapidly move their money to the US in the hope of making a quick profit. These rapid, speculative movements of capital are only possible because of the financial deregulation that has been promoted across the developing world over the past few decades by the World Bank, the IMF and free-trade agreements, and they can lead to serious market instability – particularly in small economies. But they also provide an avenue for moving money illegally across borders.
>In 2013, trade misinvoicing accounted for 80.6 percent of illicit outflows from developing countries, or $879 billion.
Trade misinvoicing, for its part, involves sending money into secret offshore accounts by cheating the trade system. For example, imagine that a South African firm has agreed to buy $1 million of steel from a British firm. The South African firm requests that the British firm send the invoice for $1 million to a tax haven. The tax haven then rein-voices the South African firm at more than the agreed value of the goods – say $1.5 million. The South African firm pays the $1.5 million to the tax haven. The tax haven then pays $1 million to the British firm and diverts the rest to an offshore account. As far as the tax authorities in South Africa can tell, the transaction appears legitimate – but the South African firm has successfully spirited $500,000 into an offshore account where it will never be taxed. While this practice amounts to a serious crime, tax havens nonetheless openly advertise their reinvoicing services and offer to assist firms in setting up shell companies to launder money and evade taxes. A quick Google search for ‘re-invoicing services’ turns up dozens of companies located in the Seychelles, Mauritius and so on, ready and willing to help traders execute their crimes.
In other words, for every $1 of aid that developing countries receive, they lose $24 in net outflows. These outflows strip developing countries of an important source of revenue and finance for development. The GFI report finds that increasingly large net outflows have caused economic growth rates in developing countries to decline, and are directly responsible for falling living standards.