The Gendered Impacts of Illicit Financial Flows in Developing Countries

Abstract

Illicit financial flows (IFFs) are widely seen to be a major impediment to development in developing countries. IFFs have long been investigated but have only recently become a leading subject of debate, advocacy and concern for development institutions and practitioners. The Washington-based think tank Global Financial Integrity (GFI), which focuses on IFFs, estimates that between 2006 and 2015 developing countries lost 20% of the value of their trade with developed countries through IFFs. However, an aspect of IFFs which has been hardly investigated is their impact on gender equity. IFFs result in a lack of resources for projects which can help attain gender equity. IFFs affect women through lack of funding for public goods and services such as education and sexual and reproductive health services, which are mostly utilized by women. This has perpetuated and exacerbated the cycle of poverty among women, resulting in the feminization of poverty. IFFs have resulted in high unemployment and poor working conditions for women. In developing countries IFFs, and the decline in government revenues that they cause, have led to increases in consumption taxes on goods and services that women are especially reliant on; these taxes are thereby detrimental to gender justice. Not much work has been done on how IFFs affect gender equality and there is a need for more investigation and advocacy on this matter.