Taxing Africa’s Shadow Economy

Formalizing the informal sector through effective and fair taxation policies could yield significant benefits. Experts suggest that taxing the informal sector could increase government revenue by 15% to 25% in many African countries. This additional income could fund critical infrastructure projects, expand healthcare and education systems, and reduce reliance on foreign aid and debt.

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A Case of Two Colors

The “case of two colors” argument—often used to describe disparities in legal treatment based on power, influence, nationality, or race—could be debated in the cases of Vikas Sagar, a former McKinsey executive, and Manuel Chang, Mozambique’s former finance minister. Their legal outcomes present a stark contrast, despite both being implicated in large-scale financial corruption

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Africa’s Weak Structures and Western Greed Fuel a Culture of Bribery

Global consulting giant McKinsey & Company has agreed to pay a $122 million settlement with U.S. authorities over its involvement in South Africa’s state capture scandal. The deal marks the latest effort to hold corporations accountable for their role in the corruption that crippled South Africa’s economy during the tenure of former President Jacob Zuma.The settlement comes after years of investigations into how McKinsey allegedly colluded with corrupt officials at state-owned enterprises, including Eskom (the national power utility) and Transnet (the national transport company), to secure lucrative contracts through fraudulent means.

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The Role of Cross-Border Trade

Regional economic integration, exemplified by initiatives like the AfCFTA and COMESA, represents a strategic approach to amplifying economic opportunities. These frameworks facilitate the free movement of goods, services, and capital across borders, creating larger markets and enhanced business opportunities for participating nations.

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