The legacies of colonial rule, both generally and in particular categories of colony, have and still continue to affect post-colonial economic development in Africa through the extraction of resources and illicit funds. The new agency for this is the “Corporation”, which has its origins in the East India Company sanctioned by Queen Elisabeth I as a royal charter.
The Corporation, which was a revolutionary European invention contemporaneous with the beginnings of European colonialism, and which helped give Europe its competitive edge – has continued to thrive long after the collapse of European imperialism. It was arguably one of the West’s most important exports to the colonies, and the one that has for better or worse changed the trajectory of most countries in Africa as much as any other European idea.
These companies have now become a new way of life. Moreover, this should not come as a surprise, especially given the power of multinationals in a globalised world. They have surreptitiously plundered the boundaries of sovereign states and effectively become the new oligarchs of the political economy of global trade. They are the new symbols of global economic power. Ironically, the politics of globalisation and the multinationals are rewriting the societal rules of the power game – with the legitimacy of a modernisation process that has deftly come to pass.
In this respect, the process of globalisation has only served to exacerbate the situation. Globalisation has also come to mean “politicisation”. The process allows the owners of these new multinational juggernauts to play key roles not only in the economies of host countries, but in society as a whole – if only because they have the power to almost “legally” withdraw the material resources from society.
Globalisation is also playing out unexpectedly as governments, multinationals, and individuals around the world are connected to one another at an unprecedented rate. One of the most important but overlooked dynamics, given its national security implications, has been the pervasive networking of professional services providers with power brokers and their acolytes from corrupt authoritarian states.
These corporations continue to transform themselves and are responsible for illegal financial flows from most fragile developing countries of Africa, to destinations known as “tax havens” or “secrecy jurisdictions”.
Contrary to public impression, tax havens or secrecy jurisdictions are not remote from the mainstream political economy and that in practice they are major and integrated features of globalised financial markets, operating as a corruption interface between licit and illicit cross-border financial flows.
Less well recognised, however, is that these “secrecy jurisdictions” and the bankers, lawyers and accountants who operate from these jurisdictions, actively encourage and support corrupt practices by facilitating illicit financial flows through an “offshore interface” between the illicit and licit economies.
Source: Pambazuka News
*The views of the above article are those of the author and do not necessarily reflect the views of Africa Speaks 4 Africa or its editorial team.