This paper deals with the composition and constituents of capital flights, its implications as well as theoretical expositions and praxis.
Virtually, all macroeconomic sage, as well as, most scintillating economists stress that Nigeria's economic somnambulism and financial crunch is consequent upon the following; dwindling of oil price in the international market, undiversified economy, unchecked inflation, high rate of unemployment and a little emphasis on the adverse effect of exchange rate volatility on economic growth, without a clear consideration of how capital flight contributes to the economic mess in Nigeria. Put differently, many scholars have actually exposed how the aforementioned macroeconomic variables are responsible for economic melt-down, but, the backwash of illegal financial exodus (capital flight) on the effeteness of Nigerian economy appears to have been jettisoned.
Capital flight, no doubt, had remained conceptually an elusive phenomenon. This is because it seems unclear what differentiates capital flight from normal capital outflows. So, capital flight is one of the terms that suffer from problems of definition and is therefore prone to various interpretations and applications. In fact, so confused is the term that many researchers in international economics, in attempting to give empirical support become guilty of the concept and as a result thrive on barefoot empiricism and outlandish intellectual circumvention.
Inhaltsverzeichnis (Table of Contents)
- "THE PREAMBLE"
- "Basic Definitions"
- COMPOSITION AND CONSTITUENTS OF CAPITAL FLIGHT
- Hawala Transactions
- Trade Miss-invoicing
- THE IMPLICATIONS OF CAPITAL FLIGHT
- CAPITAL FLIGHT: THEORETICAL EXPOSITIONS AND PRAXIS
- Conclusions and Recommendations
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This seminar paper explores the concept of capital flight in Nigeria and its detrimental impact on the country's economic development. It examines the various components of capital flight, particularly trade miss-invoicing and Hawala transactions, and highlights the significant financial losses incurred by Nigeria due to these illicit outflows.
- Defining capital flight and distinguishing it from normal capital outflows
- Analyzing the components of capital flight, focusing on trade miss-invoicing and Hawala transactions
- Examining the economic implications of capital flight for Nigeria
- Exploring theoretical frameworks and practical examples of capital flight
- Proposing recommendations to mitigate capital flight and enhance Nigeria's economic stability
Zusammenfassung der Kapitel (Chapter Summaries)
- "THE PREAMBLE": This introductory section sets the stage by highlighting the significance of capital flight as a key factor contributing to Nigeria's economic challenges. It discusses the common macroeconomic factors cited for Nigeria's economic difficulties and emphasizes the often-overlooked role of capital flight.
- "Basic Definitions": This section delves into the complex and controversial nature of defining capital flight. It examines various perspectives on the phenomenon, ranging from normal capital outflows to illegal financial transactions. The author provides a clear definition of capital flight, emphasizing its illicit nature and the various channels through which it occurs.
- COMPOSITION AND CONSTITUENTS OF CAPITAL FLIGHT: This section outlines the different components of capital flight, including trade miss-invoicing, transfer or transaction mispricing, bulk cash transfers, same-invoice faking, Hawala transactions, and miss-invoicing of services and intangibles.
- Hawala Transactions: This section focuses on Hawala transactions, a popular and informal value transfer system based on trust, which operates outside formal financial systems. It highlights the significance of Hawala transactions as a conduit for illicit financial flows.
- Trade Miss-invoicing: This section examines trade miss-invoicing as a primary method of transferring money illicitly across borders. It discusses the practice of deliberately misreporting the value of commercial transactions to evade customs regulations and reveals the substantial financial losses attributable to this form of illicit financial outflow.
Schlüsselwörter (Keywords)
Capital flight, Nigeria, economic development, illicit financial flows, trade miss-invoicing, Hawala transactions, informal financial systems, macroeconomic variables, economic stability.
- Citation du texte
- Ugwuja Chinonso Oliver (Auteur), 2019, Capital Flight. The Hidden Hand in Nigeria's Economic Destruction, Munich, GRIN Verlag, https://www.grin.com/document/463199
