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Copenhagen Consensus Center

Dirty Development Money

Bjorn Lomborg addresses the issue of illicit financial flows and describes how the topic can be improved through the post-2015 sustainable development goals. 

Developing Countries Could Reap Trillions

The Wall Street Journal reports on Alex Cobham’s paper analyzing Illicit Financial Flow targets for the Post-2015 development agenda, written for the Copenhagen Consensus Center. 

How to raise $770bn for African Development

Upon the release of our latest research on Illicit Financial Flows, news outlets in Africa have become interested, as the research points out that curbing Illicit Financial Flows has a particular importance in Afric...

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Scroll down for short summary. Or download the one-page PDF containing the smartest targets to combat Illicit Financial Flows. 

    Illicit Financial Flows

    For each of the three proposed targets, there is currently insufficient evidence to provide precise benefit-cost analyses. However, available data indicate that in even the most conservative scenarios, they are likely to exhibit high ratios of benefit to cost.



    Targets with the highest benefit-cost ratios are:

    The following targets are relatively ineffective or there is large uncertainty regarding the benefit-cost ratio:

    Assessment Paper

    The aim of the assessment paper, commissioned by the Post-2015 Consensus project and written by economist Alex Cobham, research fellow at the Center for Global Development in Europe, is to examine the costs and benefits of potential targets to combat illicit financial flows. This paper provides a tentative analysis of the measures proposed by the UN High Level Panel, finding that while the Panel's recommendations are flawed, there are potentially powerful post-2015 targets which could ensure the framework delivers major progress in reducing illicit financial flows, including tax evasion and theft of state assets.

    The specific [UN High Level Panel] proposal is flawed – but this does not imply that it should be dropped, rather that alternatives be developed."

    - Alex Cobham

    Perspective Paper

    Peter Reuter, Professor in the School of Public Policy at Maryland University commends Cobham’s attempt to improve on the High Level Panel’s objective in regard to illicit financial flows. However, he expresses great skepticism about the plausibility of Cobham’s estimates of the benefits and costs of implementing a set of measures aimed at illicit financial flows.

    We need to know more about both the phenomenon itself and about the effects of different interventions."

    - Peter Reuter

    Perspective Paper

    Tom Cardamone and Dev Kar of Global Financial Integrity commends the paper by Alex Cobham for being very thorough and professional in analyzing the High Level Panel’s targets related to reducing illicit financial flows. However, the perspective of  Global Financial Integrity differs on a number of points. Instead, this perspective paper presents a narrow SDG target on illicit financial flows which retains the very focused nature of the High Level Panel’s original version while incorporating a proportional measure to indicate progress.  

    Global Financial Integrity agrees with Cobham in several instances.  For example, GFI concurs that the HLP’s original three targets to reduce illicit flows and tax evasion, and increase asset recovery were undermined by framing them in dollar rather than percentage terms.” 

    - Tom Cardamone and Dev Kar

    Viewpoint Paper

    The viewpoint of Angela Me of UNODC, finds that the assessment paper by Alex Cobham does not discuss the normative framework for anti-money laundering or countering the financing of terrorism. Furthermore, the paper does not comprehensively discuss the flows themselves or the flows of illicit goods and services. The paper could be much improved by a solid grounding in the framework of the UN conventions. 

    [The assessment paper] makes a useful appeal for the development and monitoring of indicators which could measure the effectiveness of policies and interventions."

    - Angela Me

    Viewpoint Paper

    The view of Semkae Kilonzo of Policy Forum, finds that the assessment paper by Alex Cobham overlooked crucial perspectives and argues that greater inclusion and a multi-stakeholder approach to dialogue will help improve the applicability of the alternative targets proposed.

    Greater inclusion and dialogue between South CSOs, the private sector, OECD and non-OECD governments will help correct [the proposed targets]."

    -Semkae Kilonzo

    The Post-2015 Consensus project brings together 60 teams of economists with NGOs, international agencies and businesses to identify the targets with the greatest benefit-to-cost ratio for the UN's post-2015 development goals.