Roman Tereschenko, a business analyst and expert, delves into the issue of illicit financial flows (IFFs) and proposes strategies to bolster economic security. IFFs, also known as money laundering, involve the clandestine movement of capital across international borders. These flows are characterized by their criminal origins (e.g., corruption, smuggling), deceptive motives (e.g., tax evasion), or malicious purposes (e.g., terrorist financing). Tereschenko highlights the significant share of IFFs in the global economy, estimated at $1.4 to $2.5 trillion. This substantial sum underscores the severity of the consequences and emphasizes the need for countermeasures.
Challenges Posed by IFFs
Combating IFFs presents a global challenge, posing serious threats to economies worldwide. The annual outflow of substantial sums of money from countries, as Tereschenko asserts, is linked to practices such as money laundering, the use of tax havens, transfer mispricing, and false invoicing in trade. The expert elaborates on these processes.
Money Laundering:
Roman This involves the legalization of proceeds from criminal activities to conceal their illicit origins. The annual volume of money laundering is estimated at $800 billion to $2 trillion.
Transfer Mispricing and False Invoicing: These practices enable companies to reduce their taxable profits or inflate expenses, negatively impacting economies.
Tax Havens: These jurisdictions offer favorable tax regimes, attracting capital estimated at $5 to $7 trillion. This poses a significant threat to economies.
Strategies to Combat IFFs
Tereschenko advocates for a multifaceted approach to combatting IFFs, encompassing both national and international measures.
National Measures: These include enhancing tax systems, implementing administrative reforms, and improving governance effectiveness.
Global Measures: These entail establishing a minimum global tax rate and fostering international cooperation to identify and hold perpetrators accountable.
Conclusion
Roman Tereschenko urges for stricter controls over financial flows and the implementation of robust mechanisms to combat IFFs. These efforts will contribute to strengthening economic security both nationally and internationally.
Additional Points
The essay effectively highlights the detrimental impact of IFFs on global economies.
Tereschenko's proposed strategies provide a comprehensive framework for addressing the issue.
The emphasis on international cooperation underscores the interconnectedness of the global financial system.
Overall, the essay presents a well-structured and informative analysis of IFFs, offering valuable insights and recommendations for policymakers and stakeholders.