Cape Town - President Jacob Zuma warned on Thursday that those behind illegal capital outflows would be caught.
Replying to questions in the National Assembly, he said the United Nations Economic Commission for Africa (UNECA) recently estimated that about R383.28bn ($50bn) is illegally exported out of the African continent every year.
This is done through tax evasion, incorrect invoicing, import over-pricing, and under-pricing exports.
According to information given to the African Union, the countries most affected are South Africa, Algeria, Egypt, Morocco, and Nigeria.
The flow of illicit finance severely undermines the possibilities for socioeconomic development across the continent, Zuma said.
It reduces tax collection, cancels investment, and undermines free trade as it removes resources that could otherwise be used for poverty alleviation and economic growth.
However, the government has measures in place to address this problem.
Sars surveillance
The SA Reserve Bank's financial surveillance department, which is responsible for administering exchange control, continues to detect and deal with unlawful financial outflows by people who bypass restrictions placed on the movement of funds exceeding certain thresholds.
In addition, the Financial Intelligence Centre processes information from a range of financial institutions, such as banks, to prevent money laundering and terror financing.
In the previous financial year, the centre referred cases to the value of R66.1bn to law enforcement agencies and the SA Revenue Service (Sars) for investigation.
Sars has also achieved significant success in identifying, seizing where appropriate, and prosecuting those involved in illegal imports, the under- and over-invoicing of imports and exports, and Value Added Tax fraud.
During the current financial year, Sars has already confiscated 3.4 million articles of clothing and footwear valued at almost R580m.
It has seized drugs worth R139m and 683 million "sticks of cigarettes" valued at R180m. In addition, Sars had offered amnesty to encourage culprits to come forward.
"Government will work with the United Nations Economic Commission for Africa to contribute to stemming the tide of the illicit financial outflows from South Africa," Zuma said.
Replying to questions in the National Assembly, he said the United Nations Economic Commission for Africa (UNECA) recently estimated that about R383.28bn ($50bn) is illegally exported out of the African continent every year.
This is done through tax evasion, incorrect invoicing, import over-pricing, and under-pricing exports.
According to information given to the African Union, the countries most affected are South Africa, Algeria, Egypt, Morocco, and Nigeria.
The flow of illicit finance severely undermines the possibilities for socioeconomic development across the continent, Zuma said.
It reduces tax collection, cancels investment, and undermines free trade as it removes resources that could otherwise be used for poverty alleviation and economic growth.
However, the government has measures in place to address this problem.
Sars surveillance
The SA Reserve Bank's financial surveillance department, which is responsible for administering exchange control, continues to detect and deal with unlawful financial outflows by people who bypass restrictions placed on the movement of funds exceeding certain thresholds.
In addition, the Financial Intelligence Centre processes information from a range of financial institutions, such as banks, to prevent money laundering and terror financing.
In the previous financial year, the centre referred cases to the value of R66.1bn to law enforcement agencies and the SA Revenue Service (Sars) for investigation.
Sars has also achieved significant success in identifying, seizing where appropriate, and prosecuting those involved in illegal imports, the under- and over-invoicing of imports and exports, and Value Added Tax fraud.
During the current financial year, Sars has already confiscated 3.4 million articles of clothing and footwear valued at almost R580m.
It has seized drugs worth R139m and 683 million "sticks of cigarettes" valued at R180m. In addition, Sars had offered amnesty to encourage culprits to come forward.
"Government will work with the United Nations Economic Commission for Africa to contribute to stemming the tide of the illicit financial outflows from South Africa," Zuma said.