Rwanda’s Minister of Finance and Economic Planning, Claver Gatete, has called on African leaders to tackle illicit financial flows to strengthen investors’ confidence in the continent.

Gatete’s made the call in a statement by the African Export-Import Bank (Afreximbank) on Thursday in Lagos.

He spoke at the Third Annual Customer Due Diligence and Corporate Governance Forum organised by Afreximbank in Rwanda.

Gatete was quoted as saying that African leaders must tackle the menace because an estimated $50 billion was being lost annually by Africa due to illicit financial flows.

He warned that this should be a source of concern to the continent, especially as access to finance and capital was a key constraint to growth and economic development.

Gatete noted that over the last 50 years, Africa had lost in excess of $1.7 trillion to illicit financial flows.

“That amount roughly equaled all the official development assistance it received during the same period.

The illicit activities have significant implications for growth and economic development and for the financial soundness of banks and corporate entities.

“The activities undercut legitimate economic activities, discouraged investment, bred suspicion and undermined government legitimacy,” he said.

The minister urged African financial institutions, regulatory bodies and governments to work together to establish mechanisms that would ensure a healthier financial landscape.

According to him, the institutions should help prevent financial crimes, as well as strengthen investors’ confidence in the continent.

Dr George Elombi, Afreximbank Executive Vice-President, Corporate Governance and Legal Services, said the high cost of conducting customer due diligence had adversely affected the stability of the African financial sector and the productivity of corporate entities.

“Financial crimes, compounded by weak corporate governance capacity, have the potential to derail legitimate economic activity.

“Besides, it slows down the development of financial markets essential for optimal allocation of capital to support the structural transformation of resource-constrained African economies,” he said.

Elombi announced that Afreximbank would launch an online African Customer Due Diligence Repository Platform to provide a centralised source of primary data required to conduct customer due diligence checks on African counterparties.

According to him, the platform will allow subscribers to conduct due diligences at a lower cost, thereby decreasing the cost of trade finance in Africa.

The forum, which is being organised in collaboration with the Rwanda Development Board, follows two editions held in Dakar in 2014 and in Seychelles in 2015.