Financial Transparency Coalition

It’s a big week for international affairs with the UN General Assembly meetings going on today, and the G20 summit happening Thursday and Friday.  While New York and the UN meetings (cough, cough, will Obama run into Ahmadinejad?, cough) have dominated coverage over the past few days, from our point of view, what comes out of the G20 Summit in Pittsburgh is much more important.

In April, the G20 leaders announced the “the era of banking secrecy is over” and vowed to crack down on tax evaders.  In July, the G8 stated the need to fight illegal financial flows from developing countries.  So, naturally, we’re hoping that the G20 will continue to make progress on these issues.  Indeed our big hope is that they’ll finally link the issue of illegal (or as we say – illicit) financial flows from developing countries with banking secrecy and the shadow global financial system.

Some leaked documents from G20 insiders look promising – definitely suggesting that the issue remains on the table.  Indeed this letter from Michael Froman, the US sherpa, to his G20 colleagues expressing the White House’s views on the conference specifically states “As we take these steps to increase the flow of capital to developing countries, we also need to prevent its illicit outflow. We should work with the World Bank and others to stem these flows and to secure the return of stolen assets to developing countries.”  While a statement like this would be the strongest to date from the G20, it does not yet make the link to banking secrecy.  Hopefully by the close of the G20 on Friday, the Communiqué will.