Illicit trade costs millions
Illicit financial flows in and out of Cambodia starved the Kingdom of at least $360 million in lost taxes annually between 2005 and 2014, according to a new report. The US-based nonprofit Global Financial Integrity measured illicit financial flows – the illegal movement of money or capital from one country to another – and found that as much as $45 billion in trade activity in Cambodia over the period was not accounted for. The loss has been primarily attributed to the misinvoicing of imports and exports, an illegal method of misrepresenting trade activity in which the value of goods is deliberately underreported. According to official Cambodian import and export data in 2014, the latest data given in the report, as much as $3.6 billion worth of misinvoiced goods and money transfers were not represented. The authors of the report conceded that this only amounted to a small fraction of illicit activity as it was impossible to track the overall flow of illegal funds across borders.
