On Tuesday, a chart showing wealth placed in tax havens by households and its equivalent in national GDP surfaced on social media, ranking Kenya second globally.
The info data purportedly published by AFP and picked by several local news portals shows Kenyan households have stashed $147.7 billion (Sh14.7 trillion) in offshore accounts, double Kenya’s GDP, which was quoted at $70.8 billion (Sh7.08 trillion) by teh World Bank in 2016.
Even so, the data doing rounds on Twitter indicates Sh14.7 trillion is 68 per cent of Kenya’s GDP, and is second to United Arab Emirates, which has $I88.7 billion (Sh18.9 trillion) or 70 per cent of the country’s GDP.
Although the graphic bears AFP’s watermark, a search by the Star did not find any piece published on the topic by the news agency. The France-based media had not responded to our message by the time of going to press.
‘Who owns wealth in tax havens’ study published last year in the Journal of Public Economics showed United Arab Emirates has the highest offshore wealth havens as a proportion of GDP at 74 per cent, followed by Venezuela at 65 per cent.
Other countries include Saudi Arabia, Russia, Argentina, Greece, Taiwan, Portugal, Turkey, Belgium and the UK.
The graph illustrating country by country offshore wealth to GDP resembles the one circulating on social media, making suspect that the author of the fake graphic inserted Kenya between UAE and Venezuela.
According to the survey by the National Bureau of Economic Research, 9.8 per cent of global GDP is hidden in tax havens.
The survey sampled countries with a GDP of at least $200 billion. Only South Africa represented Africa in the sample.
The researchers, led by Annette Alstadsaeter of the Norwegian University of Life Sciences, relied on 2016 data by Bank for International Settlements on amount of bilateral bank deposits held outside each country.
They also checked their findings with data leaked from HSBC Switzerland, and found it remarkably similar to the distribution estimated for the entire Swiss banking industry.
Although there is no study that clearly indicates the actual amount of Kenya’s money stashed in foreign jurisdictions, offshore leaked documents dubbed Panama Papers have mentioned several prominent Kenyans suspected to be hiding money abroad.
Even so, Africa Tax Justice Network Africa, during the fifth Pan African Conference on illicit financial flows in Nairobi last year, estimated that Kenya has been losing Sh40 billion every year since 2011 through illicit financial flows.
The Pan African network estimates Africa is losing at least $50 billion (Sh5 trillion) in illicit flows every year.
On Monday, Global Finance Integrity report showed Kenya lost $907 million (Sh91.5 billion) in revenue through false pricing of imports and exports in 2013.