Secret corporate ownership a global problem, says Osinbajo

SECRET corporate ownership is a global problem and bane of growth in resource-rich countries like Nigeria, Vice President Yemi Osinbajo has said.

He spoke at the Beneficial Ownership Conference of the Extractive Industries Transparency Initiative (EITI) in Jakarta, Indonesia yesterday.

The vice president’s speech was made available to reporters in Abuja.

He cited a 2014 report by the One Campaign entitled, “One Trillion Dollar Scandal”, which showed that developing countries loose one trillion dollars annually to corporate transgressions.

Osinbajo said most of the funds are traceable to the activities of companies with secret ownership.

“Another report that may enjoy mention here is the 2015 report of the High Level Panel on Illicit Financial Flows from Africa chaired by former South African President Thabo Mbeki.

“The panel stated in its report that Africa had lost more than one trillion dollars over a 50-year period, and that Africa loses more than 50 billion dollars annually to illicit financial flows.

“Most of these illicit flows are perpetrated in the extractive sector and through companies with hidden ownerships,” the vice president said.

Osinbajo said Nigeria was still struggling with the negative impact of the use of corporate ownership secrecy by senior government officials and their cronies to corner juicy contracts in the extractive industry.

He specifically mentioned the celebrated Malabu scandal of the 1990s, which, he said, remained the subject of criminal and civil proceedings in many parts of the world.

According to him, the court cases involved huge legal costs, while the full benefit of the natural resource remains unexploited for the benefit of the people of Nigeria to which it belongs.

Osinbajo said: “So, for us in the developing world and especially in Africa, breaking the wall of secret corporate ownership is an existential matter.

“It is for us literarily a matter of life and death. Masked or hidden corporate ownership is deeply implicated in the sad story of our underdevelopment.

“Yes, we know that anonymous companies are not always illegal or are not always designed to harm.

“But we also know that secrecy provides a convenient cover for the criminal and the corrupt. And we are not just operating from the theoretical or hypothetical standpoint.”

The vice president said the problem was a global one driven by an inter-connected world where the foothold of anonymous companies does not respect the developed/developing divide.