LONDON – New European plans to reveal more about multinationals’ finances will help tackle corruption in the oil, gas and mining industries – but need toughening up if they are also to help poor countries fight multi-billion pound tax dodging, says Christian Aid.

‘Today’s proposals are a welcome step forward against corruption but they do nothing to deal with corporate tax dodging, which costs developing countries significantly more than they receive in aid,’ said Joseph Stead, Christian Aid’s Senior Economic Justice Adviser.

The proposals in the Transparency and Accounting Directives, published today by the European Commission, require companies in the extractive and forestry industries to publish their payments to governments for each country in which they operate.

Mr Stead added: ‘This information will help people hold their governments to account about what they are doing with the money they are receiving from multinational companies – and that is important.

‘However, corporate accountability is equally important. Unless these proposals are expanded to cover firms in all industries and to require greater financial detail than the Commission is currently suggesting, then companies will be able to keep siphoning profits out of developing countries on a massive scale.’

Christian Aid estimates that tax dodging by multinationals costs developing countries some $160bn a year in lost revenues. The development agency is campaigning for businesses to provide full financial reports for every country in which they operate – so-called country-by-country reporting. This would allow tax dodging to be better identified and stopped.

Savior Mwambwa, Executive Director of the Centre for Trade Policy and Development, a Christian Aid partner in Zambia said: ‘A major part of the solution is for governments to require companies to reveal more about their finances, with details such as profits made and taxes paid published for every country in which they operate.

‘This sort of information would help tax authorities – including Zambia’s – to identify suspicious cases where companies appear to be artificially shifting their profits out of poor countries and into tax havens. It would not transform the balance of power between tax collectors and a company’s army of tax accountants and lawyers – but it would help.’

The proposals now go to the European Parliament and Member States to amend and adopt them.

‘The EU has opportunity to lead the world on transparency and we urge the European Parliament and Member States to act now to improve these proposals,’ said Mr Stead.

‘Extending them to cover all industries and so that they require enough information to help catch tax dodging is vital – as is closing the loopholes which will allow firms to avoid reporting their payments in some countries. The proposals’ definition of ‘project’ also needs a serious re-think,’ he added.

###

Contact:

Rachel Baird on 0207 523 2446, 07545 501 749 or rbaird@christian-aid.org

Notes:

1. Christian Aid works in some of the world’s poorest communities in nearly 50 countries. We act where the need is greatest, regardless of religion, helping people build the lives they deserve.

2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty. Details at http://www.christianaid.org.uk/Images/poverty-over-report.pdf

3. Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development. Further details at http://www.actalliance.org

4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit www.christianaid.org.uk

Click here to view the embedded video.

Watch the (excellent) video, then visit EndTaxHavenSecrecy.org to take action today. Join us in calling to demand tax justice at the G20 summit in France in November 2011.

Tax dodging by multi-national corporations costs developing countries hundreds of billions of dollars every year, much more than the global foreign aid budget. You can read their position paper here.

PARIS – Investors who want to ensure their money supports ethical concerns should add tax behaviour to the criteria by which companies are judged, Christian Aid says today.

‘Along with traditional concerns such as involvement in tobacco, weapons and environmental issues, a company should also be assessed on its tax practices,’ says Dr David McNair, Christian Aid’s Principal Adviser on Economic Justice.

‘Companies should contribute to the societies in which they work. Paying tax is a major way in which they can do so, helping fund schools, hospitals and other essential public services.

‘To qualify as an ethical investment, Christian Aid believes a company must pay its taxes in a transparent way. This includes paying the taxes they owe in the countries where the work which generated the profits actually took place.

‘Some unscrupulous multinational corporations use the secrecy offered by the world’s tax havens to avoid, or even evade, the tax they owe, which has a particularly damaging impact on the poorer countries where they operate.

‘At present, we estimate that tax dodging by multinationals costs developing countries some $160bn a year in lost tax revenue – one-and-a-half times the amount they receive from rich countries in aid. This harms millions of people living in poverty.’

In a report published this week calling for tax to be regarded as a corporate responsibility issue, Christian Aid warns that companies which pursue aggressive tax strategies face a higher risk of reputational damage than those that don’t. They also risk costly legal action being taken against them by tax authorities.

The report argues that companies should consider implementing codes of conduct which rule out aggressive tax behaviour and include commitments such as:

• Income is held to be taxable in the country where it was generated.
• Tax planning will seek to comply with the spirit as well as the letter of the law.
• Tax planning will be consistently disclosed to all tax authorities it affects.
• Information about transactions will be consistently disclosed to all the tax authorities involved.

###

Contact:

For more information or to arrange an interview with David McNair, please contact Rachel Baird on +44 (0)207 523 2446, +44 (0)7545 501 749 or rbaird@christian-aid.org

Notes to Editors:

1. Christian Aid works in some of the world’s poorest communities in nearly 50 countries. We act where the need is greatest, regardless of religion, helping people build the lives they deserve.

2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details at http://www.christianaid.org.uk/Images/poverty-over-report.pdf

3.  Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development.  Further details at http://www.actalliance.org

4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit www.christianaid.org.uk

LONDON – Policy makers are failing to live up to the pledges of the world’s most powerful nations to tackle tax haven secrecy, according to the latest findings of an index that analyses the contribution different jurisdictions make to this global threat.

Despite a G20 commitment two years ago to curtail the activities of tax havens, the Financial Secrecy Index shows that the level of secrecy in international financial services is intensifying.

The Index, drawn up by Christian Aid and the Tax Justice Network, ranks 72 leading countries and jurisdictions offering finacial services according to the amount of international business they handle, and the secrecy their clients enjoy.

Switzerland, with the ink barely dry on a controversial tax deal with the UK which was condemned by Christian Aid as ‘collusion with criminality’, now heads the list as the world’s most harmful purveyor of financial secrecy.

The Cayman Islands, where not only is the disclosure of information an offence, but the mere act of requesting it can incur penalties, is second, and Luxemburg, which has consistently opposed EU attempts to tackle tax haven secrecy, is third.

Alex Cobham, Chief Policy Adviser at Christian Aid, said today: ‘Disappointingly, given that the G20 group of governments committed in London to eradicate tax havens, the findings show that more secretive jurisdictions have actually increased their share of business, and more jurisdictions now offer greater secrecy.

‘Switzerland’s place at the top of the Index tells us something about the nature of the tax regime with which the British government has shown it is prepared to do business.

‘The authorities here are apparently happy with a deal in which Britons with secret Swiss bank accounts become liable to some tax without having to disclose their identities.

‘Switzerland, along with Luxemburg, has aggressively fought attempts by the European Union to promote financial information exchange between governments.

‘But tax haven secrecy is hugely damaging and facilitates crimes such as money laundering, corruption and tax evasion.  It also has a grave impact on the economies of developing countries as it enables some unscrupulous companies trading internationally to cheat the exchequers of such countries by hiding their tax liabilities.’

Other jurisdictions in the top ten (in descending order) are Hong Kong, USA Singapore, Jersey, Japan, Germany and Bahrain.

The UK, which in the first edition of the Index published in 2009, was in fifth place (Switzerland was in third), has now fallen to 13, partly because its share of global offshore financial services has fallen, and partly because it is ranked as only ‘moderately secretive’.

John Christensen, Director of Tax Justice Network, an international, non-aligned coalition of researchers and activists with a shared concern about the harmful impacts of tax haven secrecy, said: ‘The Financial Secrecy Index reveals how the G20 is only chipping away at the outer shell of financial markets’ secrecy.

‘Powerful countries like Switzerland, Britain and the USA still block progress towards tackling the economic fault lines lying at the root of the current crisis. There will be no resolution of the crisis until the issues have been confronted full on.’

Rhetoric from the Organisation for Economic Co-Operation and Development (OECD) regarding a clampdown on tax havens has led to greater activity in Asian centres such as Singapore and Hong Kong, pushing both those jurisdictions up the index, Hong Kong climbing to fourth and Singapore to sixth.

The growth of business both havens enjoyed reflects their strong links to China which are attractive to those in the West that want financial secrecy because China is outside the OECD and has resisted pressure for reform. Singapore in particular is said in the Index to have ‘aggressively courted’ illicit funds being shipped out of Atlantic basin countries by people worried about a clamp down.

Two new entrants to the Index are Ghana (44th) and Botswana (49th).

Alvin Mosioma, Co-Ordinator of Tax Justice Network, Africa, said: ‘Until recently, Mauritius was the only African tax haven. It is deeply worrying to see these two newcomers being encouraged in some quarters to move towards tax haven status emerge given the damaging effect tax haven secrecy has on developing countries.

‘Such efforts undermine the ongoing process at the African Union to address illicit financial flows from the continent. ‘

Other welcome changes since 2009 include increases in financial transparency in Belgium, Guernsey and the Isle of Man, all of which have introduced automatic tax information exchange with countries in the European Union.

And despite coming top of the Financial Secrecy Index in its previous release in 2009, the USA has this year been given credit for attacking Swiss banking secrecy and promoting financial transparency with the passage of the Dodd-Frank Act, which requires US-listed extractives companies to report their payments to governments.

Nick Shaxson, author of Treasure Islands: Tax Havens and the Men who Stole the World, said the Financial Secrecy Index revealed the inadequacy of the efforts being made to counter tax haven secrecy.

‘Countries like Switzerland, Luxembourg and the Cayman islands are busy patting themselves on the backs about how many new information-sharing agreements they have signed recently,’ he said.

‘The Index, the biggest investigation into global financial secrecy in history, demonstrates how shallow these efforts are, and how the secrecy system is supported by some of the world’s most powerful countries. The rapid rise of gigantic secrecy industries in Singapore and Hong Kong is particularly worrying.’

In order to reflect better the global importance of transparency, this year’s Index has been calculated differently from the previous one. The greater weighting given to secrecy has contributed to the move down the Index of the biggest financial players such as the USA and the UK and the rise of smaller, more secretive jurisdictions such as Switzerland, the Cayman Islands and Panama.

Later this week (October 07)  Christian Aid and other members of the End Tax Haven Secrecy campaign will launch a Global Day of Action in advance of a G20 finance ministers meeting in Washington on the 14th and 15th October.

The aim is to persuade French president Nicolas Sarkozy as chair of the G20 this year to make tax haven secrecy a priority at a full meeting of the G20 in Cannes in November.

Christian Aid plans a protest outside HM Treasury, and a hand-in of letters to G20 embassies in London. French civil society groups are planning a number of activities that day including flash mobs and demonstrations outside different government buildings, using the slogan ‘Yes we can in Cannes’.

At the same time the Index will be presented at a special session of the annual conference of the intergovernmental, inter-NGO Task Force on Financial Integrity and Economic Development in Paris.

###

Contact:

Further information from Andrew Hogg on 0207 523 2058 or ahogg@christian-aid.org. 24 hour press duty phone: +44 07850 242950

Notes to Editors:

1. Christian Aid works in some of the world’s poorest communities in nearly 50 countries. We act where the need is greatest, regardless of religion, helping people build the lives they deserve.

2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details at http://www.christianaid.org.uk/Images/poverty-over-report.pdf

3. Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development.  Further details at http://www.actalliance.org

4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit www.christianaid.org.uk

WASHINGTON – G20 ministers’ latest plan to help poor countries misses an opportunity to drive massive change because it neglects action against tax dodgers, says Christian Aid.

‘The communiqué released by G20 ministers meeting in Washington last night addresses important challenges but fails to prioritise one of the world’s most powerful weapons against poverty,’ said Dr David McNair, Christian Aid’s Principal Adviser on Economic Justice.

‘That weapon is financial transparency, which would make life far harder for the unscrupulous multinationals and individuals who currently dodge tax in poor countries on a multi-billion scale.

‘Poor countries currently lose more to tax dodging alone than they receive in aid – we estimate that tax dodging costs them some $160billion ever year,’ added Dr McNair.

‘Tackling this severe haemorrhaging of poor countries’ resources should be at the very top of the G20’s agenda but their latest communiqué makes only the most passing reference to it.

‘People living in poverty need the powerful G20 nations to throw their weight behind the fight against tax dodgers, who thrive on financial secrecy, not to go soft on them.’

‘We welcome the G20’s recognition that developing countries need to raise more taxes to fund infrastructure and protect the most vulnerable. But developing countries also need high-level political support to make this a reality’ said Dr McNair.

In addition, Christian Aid welcomes the communique’s acknowledgement of the need for regulators to take a closer interest in financial markets’ trade in commodities, which can drive food prices out of poor people’s reach.

‘We are also pleased by what we have heard about the report G20 countries have commissioned Bill Gates to write about new ways to help people living in poverty,’ added Dr McNair.

‘We understand that Mr Gates’ final report in November will recognise the huge importance of helping poor countries to collect the billions in tax that are rightfully theirs.

‘However, Christian Aid and the many other organisations working for tax justice want G20 countries themselves to be saying such things – and acting on them.

‘We will be working hard to get tax and transparency at the very top of the agenda for G20 leaders’ meeting in Cannes this November.’

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Contact:

For more information and to arrange interviews with David McNair, please contact Rachel Baird on +44 07545 501 749.

WASHINGTON – The world’s most powerful countries may be about to renege on their pledges to help developing nations fight massive tax dodging by multinationals, Christian Aid is warning.

Leaked documents suggest that a communiqué due to be issued by G20 development ministers in Washington tomorrow (Friday) has been dramatically watered down from earlier versions which made strong commitments to tackle the tax dodging that harms poor countries.

‘We are alarmed by what we have heard about the draft communiqué,’ said Dr David McNair, Christian Aid’s Principal Adviser on Economic Justice.

‘Tax dodging costs developing countries some $160 billion a year – far more than they receive in aid – and in 2010, G20 heads of state committed themselves to helping poor countries increase their tax revenues

‘But we fear that on Friday, the G20 may downplay the seriousness of this menace and renege on its promises to help fight it.

‘We hear that in the latest draft communiqué, the importance of transfer-pricing – which unscrupulous companies abuse in order to evade tax– is downplayed, while references to reforms which would force multinationals to reveal more about their finances have been deleted.

‘Furthermore, we hear that even an acknowledgement that some multinational companies do dodge tax in poor countries has been deleted from the draft, along with a commitment to help poor countries improve their ability to collect taxes.

‘We would be delighted if these leaks prove wrong and if the final communiqué on Friday contains the stronger language and commitments which appeared in earlier drafts, which are the minimum acceptable.’

Alvin Mosioma, Co-ordinator of Tax Justice Network Africa, said: ‘These leaks suggest the G20 is in danger of undermining developing countries’ efforts to boost their own incomes, which they need to do to reduce poverty and fund sustainable development.

‘Other institutions such as the Africa Union and UN Economic Commission for Africa are taking concrete steps to combat illicit financial flows. But given the influence of the G20 on the global financial architecture, it is in danger of inflicting a huge setback on efforts to curb the illicit flows that are absorbed by secrecy jurisdictions—most of which are located in G20 countries.’

Christian Aid supporters are today (Thursday) emailing G20 development ministers, reminding them of G20 heads of states’ 2010 commitment to help poor countries increase their tax revenues.

###

Contact:

For more information and to arrange interviews, please contact Rachel Baird on 07545 501 749 or rbaird@christian-aid.org

Notes to Editors:

1. Christian Aidworks in some of the world’s poorest communities in nearly 50 countries. We act where the need isgreatest, regardless of religion, helping people build the lives they deserve.
2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality.Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details at http://www.christianaid.org.uk/Images/poverty-over-report.pdf
3. Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development.  Further details at http://www.actalliance.org
4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire
5. For more information about the work of Christian Aid visit www.christianaid.org.uk

LONDON – The new tax deal between the UK and Switzerland amounts to collusion with criminality and will seriously damage poor countries’ attempts to collect the billions they lose to tax dodgers, Christian Aid is warning.

‘This deal makes it much less likely that developing countries will ever be able to get the taxes owed to them from those hiding money in tax havens like Switzerland. It is a disgrace,’ said Christian Aid Director Loretta Minghella.

The UK-Swiss agreement will lead to Britons with secret Swiss bank accounts starting to pay tax on them, which the Swiss will pass on to the UK – but crucially, without revealing account holders’ identities.

Tax evaders will have the option of owning up to the UK authorities about their accounts, as an alternative to paying a one-off back tax of between 19 and 34 per cent on their hidden money.

However, Ms Minghella argued that by allowing people to keep their identities hidden, the UK Government is, in effect, colluding with criminality.

‘Why would anyone rather pay a back tax of 19 to 34 per cent on the money they have hidden in Switzerland than reveal their identity, unless they have done something seriously wrong? And why is the Government letting them get away so lightly?’ she asked.

‘The most likely reason is that they have evaded a whole lot more tax than that or been involved in other serious criminal behaviour.

‘This is a bad deal for honest British tax payers and for scores of poor countries around the world.’

Christian Aid believes the deal will seriously damage global efforts to curb tax dodging – a menace which it estimates costs poor countries $160 billion a year, far more than they receive in aid.

Germany is also reported to have initialled a similar deal with Switzerland.

Poor countries lack the political and economic clout to do such deals with Switzerland – but they too lose billions as a result of money being illegally hidden in tax havens.

And just like the UK, they need that money to fund vital public services such as schools, hospitals and care for the elderly.

Christian Aid is calling on the UK and other G20 Governments to use their November summit meeting in Cannes to bring about an end to the tax haven secrecy exemplified by Switzerland.

Specifically, the G20 should broker a new system of automatic information exchange between Governments – including those of poor countries – to help them to detect when citizens hide wealth offshore.

###

Contact:

Rachel Baird
+44 0207 523 2446
+44 07545 501 749
rbaird@christian-aid.org

Notes to Editors:

1. Christian Aid works in some of the world’s poorest communities in nearly 50 countries. We act where the need is greatest, regardless of religion, helping people build the lives they deserve.

2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details athttp://www.christianaid.org.uk/Images/poverty-over-report.pdf

3.  Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development.  Further details at http://www.actalliance.org

4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit www.christianaid.org.uk

LONDON – Christian Aid has welcomed a new from the World Bank for countries to exchange information about who really owns companies, bank accounts and other financial assets within their borders, in a bid to help recover the billions currently stolen from poor countries each year.

‘Christian Aid is delighted that the Bank is speaking out about the urgent need for countries to lift the financial secrecy which criminals abuse to hide dirty money,’ said DrDavid McNair, the agency’s Senior Adviser on Economic Justice.

‘At present, some countries obstruct investigators who are attempting to trace and recover the staggering amounts of money stolen from poor countries, by claiming that they do not have the information sought.

‘The Bank’s recommendation that countries should create publicly-available registries of who owns what within their borders could make a dramatic difference to poor countries, which currently struggle to trace and recover even a small fraction of the billions they lose to tax dodging, corruption and other financial crimes.

‘Christian Aid estimates that at present, the amount developing countries lose to tax dodging by companies trading across borders is some $160 billion a year, which is one-and-a-half times the amount they get in aid from rich countries.

‘Access to information is also crucial for tax authorities wanting to pursue suspected international tax dodgers. At present, many developing countries cannot access this information – global financial secrecy works powerfully against them.’

The Bank’s recommendations about reforms needed to help recover stolen assets come in a new 196-page report called Barriers to Asset Recovery.

It states: ‘Establishing a national bank registry of account holder information is a powerful tool to facilitate the tracing of assets and to accelerate and assist international cooperation.’

The World Bank also notes: ‘Because criminals often use other individuals, attorneys, and legal persons to hide assets, such tools would be even more useful if they identify the beneficial owner of the account and any power of attorney related to the account. By helping to identify accounts, central bank registries…speed the work of law enforcement authorities in asset recovery cases.’

As well as recommending the creation of such registries, the report makes a host of other suggestions aimed at helping developing countries recover more of the $20 to $40 billion which it estimates they currently lose through corruption each year. The Bank also estimates that of this huge outflow, only $5 billion of stolen assets has been repatriated over the last 15 years.

‘Christian Aid is also pleased to see the Bank recognising that what it calls ‘excessive banking secrecy’ is part of the problem facing poor countries and that greater exchange of financial information between countries is part of the solution,’ added Dr McNair.

Christian Aid is part of the End Tax Haven Secrecy campaign, which is calling on G20 leaders to agree at their November summit in Cannes, France, on action to effectively end tax haven secrecy. A new system through which all countries can automatically share financial information with each other is a critical part of such action.

###

Contact:

Rachel Baird
+44 0207 523 2446
+44 07545 501 749
rbaird@christian-aid.org

Notes to Editors

1. Christian Aid works in some of the world’s poorest communities in nearly 50 countries. We act where the need is greatest, regardless of religion, helping people build the lives they deserve.
2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details at http://www.christianaid.org.uk/Images/poverty-over-report.pdf
3. Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance anddevelopment.  Further details at http://www.actalliance.org
4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire
5. For more information about the work of Christian Aid visit www.christianaid.org.uk

——-

The Task Force on Financial Integrity and Economic Development addresses inequalities in the global financial system that penalize billions of people, and advocates for improved transparency and accountability.

Christian Aid is a coordinating committee  member of the Task Force on Financial Integrity & Economic Development.

For additional information please visit http://www.financialtaskforce.org.

Prime Minister's Office/Flickr*

UK Prime Minister David Cameron gave a speech in Lagos, Nigeria, where he encouraged the European Union to adopt “Publish What You Pay” rules for the mining, oil, and gas industries.  According to GFI estimates, Nigeria loses over $14 billion each year to illicit financial flows, far more than any other African nation, with its energy sector being by far the most prominent contributor.

Task Force member Christian Aid was quick to praise the development, in particular these comments from his speech:

‘Requiring companies to reveal what they pay with regard to each project they undertake is one step towards curtailing such widespread tax abuse, and will help prevent the bribing of politicians to secure contracts.

‘But EU legislation needs to go further. In order to ensure companies are paying the right amount of tax, we need more information on how the taxes they do pay relate to the profits they make.

‘The money lost to poorer countries through tax dodging could make a significant difference to services such as health and education in the countries affected.’

In the speech, he praised U.S. efforts to improve transparency in those industries, through Section 1504 (the Cardin-Lugar provision) of the Dodd-Frank financial reform bill.  As previously mentioned, delays by the SEC have prevented full implementation of those practices to date.

Endorsement of improved financial transparency in the EU is a major positive development.  Rules similar to Dodd-Frank will help reduce international corruption—improving the daily lives of millions in the developing world and allowing free and open competition in the world energy market, thereby improving the well being of consumers as well.

*Image License: Some rights reserved by The Prime Minister’s Office

LONDON – Christian Aid today welcomed Prime Minister David Cameron’s backing for legislation that will force companies to reveal the taxes and fees paid to governments in every country where they operate.

Speaking in Lagos, the Prime Minister said the EU should follow the example of the US, which has introduced a new law to force mining and oil companies to be transparent about their payments to the regimes where they are extracting wealth.

Christian Aid believes that measures taken by companies trading internationally to conceal their profits and shift them off-shore where little or no tax is payable deprives developing countries of at least $160bn in lost tax revenues each year.

Dr David McNair, Christian Aid’s Senior Economic Justice Adviser, said: ‘The Prime Minister’s call is very welcome. It follows other remarks he has made during his trip highlighting the importance of effective tax systems as a means of enabling developing countries to achieve economic independence.

‘The amount at present lost to developing countries through tax dodging by companies trading across borders is one and a half times the amount rich countries contribute in aid every year.

‘Requiring companies to reveal what they pay with regard to each project they undertake is one step towards curtailing such widespread tax abuse, and will help prevent the bribing of politicians to secure contracts.

‘But EU legislation needs to go further. In order to ensure companies are paying the right amount of tax, we need more information on how the taxes they do pay relate to the profits they make.

‘The money lost to poorer countries through tax dodging could make a significant difference to services such as health and education in the countries affected.’

Christian Aid also welcomed the Prime Minister’s call for greater economic integration between African countries, and increased investment in infrastructure as other essentials towards greater economic self-reliance.

Likewise, the Prime Minister’s restatement of his government’s pledge to increase the aid budget substantially was warmly welcomed given the continuing needs of developing countries.

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If you would like further information please contact Andrew Hogg on 0207 523 2058 or 07872 350534. 24 hour press duty phone – 07850 242950  

Notes to Editors

1. Christian Aid works in some of the world’s poorest communities in nearly 50 countries. We act where the need is greatest, regardless of religion, helping people build the lives they deserve.

2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details at http://www.christianaid.org.uk/Images/poverty-over-report.pdf

3. Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development.  Further details at http://www.actalliance.org

4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit www.christianaid.org.uk

Andrew Hogg

News Editor/Campaigns Editor
( 00 44 (0) 207 523 2058 / 00 44 (0)7872 350534
* Christian Aid, 35 Lower Marsh, London SE1 7RL
7 00 44 (0) 207 620 0712
ahogg@christian-aid.org