EU and NATO Member Croatia is More Corrupt Than Nigeria — A Review of Illicit Financial Outflows Via Crime Corruption and Tax Evasion Reveals Troubling Data
June 16, 2018, Washington, DC —Today’s FIFA World Cup 2018 soccer match in Kaliningrad, Russia between the countries Croatia and Nigeria, places the two formidable teams in a tough pool with the game’s giant Argentina and an ambitious Icelandic team. While the fans from Europe and Africa give great attention to the soccer field, citizens from Croatia and Nigeria face a greater challenge. Corruption is rife in both countries, an oil-rich country on the African continent and a former communist entity dependent on EU taxpayer funds. Over the past few decades, billions of American and European taxpayers dollars have been sent through government to government transfers to Croatia, a population of four million people and the rest of the Balkans.
According to the research by Washington, DC-based Global Financial Integrity (GFI), Croatia’s illicit financial outflows via crime, corruption and tax evasion is $35.6 billion for the years 2005–2014, amounting to 73.16% of the nation’s 2015 GDP.
Nigeria’s 154 million citizens lost $481.1 billion in illicit financial outflows via crime, corruption and tax evasion for the years 2005–2014, amounting to 38.24% of the country’s 2015 GDP. Global Financial Integrity’s research is compiled by “analyzing illicit financial flows (IFFs)” and utilizing “sources of data and analytical methodologies that have been used by international institutions, governments, and economists for decades.”
In contrast to the backsliding and blocked reforms in Croatia under the HDZ and SDP governments rotating in power since 1991, Nigeria’s engaged citizens have demanded greater accountability of its government. The actions by Nigeria’s agencies and courts are showing positive signs. In a recent published story, Nigeria’s Economic and Financial Crimes Commission (EFCC) signed an agreement with the United Kingdom to combat corruption. The British High Commissioner to Nigeria, Paul Arkwright said, “The UK and Nigeria have evolved and made progress in the fight against corruption, and the EFCC’s achievements have been impressive.” Arkwright stated the UK government’s support was “both in technical assistance, in investigation and of course broadening support of this great independent institution of the EFCC.”
Nigeria’s proactive initiatives have led to the recovery of illicit financial outflows that were originally sent to Europe’s financial institutions in Liechtenstein and Switzerland. However, there is still more left in Liechtenstein which ought to be sent back to Nigeria.
According to the report: “On December 18, 2017, the federal government received the sum of $322,515,931.83 from Switzerland, being part of the late General Sani Abacha’s loot. Unlike the previous recoveries, the latest recovery has been specially earmarked to be spent on the vulnerable, the poor and indigent under the social safety net programme of the federal government.”
On the other hand, Croatia and the Balkan region’s perilous “Balkan Route” is a gateway for the smuggling of $28 billion of heroin annually (originating from Afghanistan/Pakistan), human trafficking — including young children for the sex tourism in Croatia, and arms smuggling (weapons used in the Paris attacks).
Croatia’s current government, run by the corruption-ridden Croatian Democratic Union (HDZ), has blocked efforts to address the nation’s illicit financial outflows. While Croatia’s government pontificates about addressing corruption, the nation is increasingly dependent on EU taxpayer aid, World Bank funds and the vulnerable tourist industry. Croatia’s political figures and parties have survived by receiving funds from corrupt sources. The ruling HDZ political party, which also stole public funds, was called “a criminal enterprise” by a brave Croatian judge.
Rule of law countries and officials representing America, Britain and continental European nations must carefully review how taxpayer funds are used in Croatia. Elected officials representing strong rule of law nations must think twice before propping-up corrupt officials and networks in the Balkans. Engaged taxpayers and civil society initiatives in America, Britain, Germany and other nations demand greater accountability and have shown their disdain for business as usual, through the ballot box and also through key initiatives such as Brexit.
Even Croatia’s football association is under the spotlight with the powerful political donor and infamous figure Zdravko Mamic, and soccer star Luka Modric. BBC reports, “Mamic was found guilty of siphoning off millions of euros in transfer fees when he was an executive at Dinamo Zagreb. On the eve of the verdict, just a few days ago, he fled across the border into Bosnia.”
Zdravko Mamic threw a birthday party for Kolinda Grabar-Kitarovic, the current president of Croatia, and funded her campaign. Balkan Insight reports, “Mamic has not hidden his connection with HDZ over the years, attending political rallies and financing the election campaign of HDZ-backed Croatian President Kolinda Grabar Kitarovic.”
Will Croatia’s Kolinda Grabar-Kitarovic, condemned for fueling anti-Semitism in the Balkan region and among the diaspora, return the funds given to her political campaign by Zdravko Mamic? And, will Croatia’s Prime Minister Andrej Plenkovic, who is also the head of the HDZ political party, address the troubling issue of theft of public funds by his own political party — known as a criminal enterprise?
There are three profound takeaways from the review of Croatia’s illicit financial outflows:
1. The failure of European Union institutions to monitor how taxpayer funds are used in Croatia.
2. A flawed NATO process which pontificates about freedom and the rule of law, yet, looks the other way when individual citizens of a member state are facing threats on the economic and security fronts.
3. The growing frustration among citizens from major EU and Eurozone countries upset at how EU structures send taxpayer money to prop-up corrupt politicians in the Balkans.
American citizens and taxpayers, through engaged legislators, are calling for greater accountability of how World Bank funds are spent. On January 17, 2018, the US House of Representatives passed the World Bank Accountability Act which would withhold US funding to the World Bank and made it contingent on reforms to be implemented by the Bank’s International Development Association (IDA).
“Giving the World Bank a blank check from U.S. taxpayers has enabled the poverty-fighting organization to lose its way. The World Bank Accountability Act, which I introduced and the House passed today, makes our future contributions to the Bank conditional on reforms that will help better fight poverty, uphold human rights and democracy, prevent the flow of funds to corrupt governments and those who support terrorism, and improve oversight and accountability.”
Strong rule of law nations around the world can follow the principled approach led by the US House of Representatives.
During the World Cup 2018 sporting event, engaged citizens and principled elected officials must review all taxpayer aid given to countries mired in corruption and stand with the citizens of these nations seeking a brighter future for themselves and their children. Robust endeavors in addressing rampant corruption by tackling illicit financial outflows via crime, corruption and tax evasion is worthy goal.
This is a winning proposition for law-abiding and hardworking citizens and taxpayers — representing donor nations and those receiving aid. The European Commission and Europe’s stakeholders could do more.