Serbia’s annual cap outflow at USD 5 bn
Serbia is ranked sixteenth on the list of countries with the largest illegal cap outflow, the Washington-based research and advocacy organization Global Financial Integrity, reported in March 2013.
“In its reports GFI follows only funds traceable through bank transfers,” economist Dragovan Milicevic told a local newspaper. “In the course of the last ten years, during which time GFI has been tracing cap outflow, more than USD 51 bln has left Serbia illegally.”
This amount puts Serbia behind countries such as Iraq, UAE, Russia, Nigeria or Mexico. Serbia’s neighbors are far better ranked, with Croatia ranked 39th, Hungary 42nd, Montenegro 50th, Bosnia 57th and Macedonia 76th.
The main sources of the illicit outflow are criminal activity, corruption and tax evasion.
This is mainly the result of a lack of financial discipline, a lack of readiness for detailed control of money flows, acquiescence for tax evasion from the authorities, and other illegal schemes for huge growth in the value of imported goods and services.
The schemes see companies from abroad, which figure as suppliers, invoice sums far exceeding actual product volumes to companies which are in reality owned by the same person as the supplier.