An interesting opinion piece by Charles Onyango-Obbo in The East African describes how Swiss bank accounts contribute to the death of African lions. When some of a Maasai man’s goats are eaten by a lion, it is a major economic disaster for the man, who has no access to insurance or any form of social safety net. The only practical way for him to protect what is left of his resources is to kill the lion, regardless of whether that is illegal.
However, the government has not made any provision for insuring or compensating people whose livestock is killed, because, according to the author, “the big men and women in most of Africa pocket the tourism dollars that come into the Treasury,” and then “they stash it in Swiss bank accounts”. According to recent news reports, East Africans currently have more than $1 billion invested in Swiss bank accounts, much of which is believed to be the proceeds of corruption.
Capital flight is a serious problem for many African countries because when money is taken out of the country and invested overseas that money is removed from investment in African business. Foreign investment helps a country, whereas capital flight harms the country. If the money was acquired corruptly, that also harms the country because it distorts the allocation of resources and contributes to scarcity.