The House of Representatives Tuesday took steps to save Nigeria the estimated capital flight of $40.7Billion, representing 46 percent of the total of $88.6 Billion that leaves the African continent through money laundry, tax evasion, diverted revenues, offshore investments and other forms of capital flights every year.
The Green Chamber consequently, urged the Federal Government to develop effective mechanism and strategy to prevent the persistent occurrence and address the menace of capital flight in Nigeria.
It asked the Federal Government to partner with private institutions to go into public-private partnership contractual agreements to build world-class medical facilities in major cities in Nigeria or upgrade and equip the existing ones with adequate facilities based on build, operate and transfer by private investors in a way that will allow the investors to manage the same for an agreed period.
The House which took the decisions while adopting a motion on: “Urgent Need to Address the Menace of Capital Flight in Nigeria moved by Afolabi Olalekan (APC, Osun) mandated the Committee on Legislative Compliance to ensure implementation. Presenting the motion, Olalekan noted that capital flight has been one of the unresolved and persistent macroeconomic problems plaguing the nation for over four decades.
He said: “ironically, Nigeria is ranked among the highest producers of crude oil in the world and earns a huge amount of foreign exchange from its exports but still falls short of capital to develop, maintain and upgrade her infrastructure due to the magnitude of capital flight from Nigeria when compared to accumulated domestic investments”.
According to him, “the Central Bank of Nigeria (CBN) Bulletin in 2015 which shows that the net flow of capital flight from Nigeria from 1986 to 2015 was quite worrisome, with Nigeria losing a colossal sum of over $8.8 Trillion”. Olalekan expressed worry at the alarming rate of foreign medical services being sought by Nigerians, both private individuals and government officials, which amounted to more than $6.5 Billion based on the statistics released by the Ministry of Foreign Affairs in 2015.
He said “while expenses on foreign education amount to more than $3 Billion based on estimates released by the Tertiary Education Trust Fund (TETFUND) in its 2014 annual report; cognizant of the recent series of pleas by successive governments to foreign banks and other international financial institutions to release and repatriate stolen and diverted funds in millions of Dollars stockpiled abroad by corrupt leaders”.
The lawmaker was concerned that capital flight exerts detrimental effects on both short and long term growth of the economy by reducing domestically available investible capital as it represents a foregone investment in manufacturing plants, infrastructure, social welfare, reduction of a country’s tax base and a contribution to the high debt profile, among others.