More than $35 billion was illicitly drained from Thailand through money laundering, tax evasion, crime and false trade documentation in 2012, marking the fourth-consecutive annual increase in corruption-tainted outflows, a US think tank said.
Washington-based group Global Financial Integrity said in a report published Monday that Thailand moved up to eighth on its list of developing countries with the most illegal capital outflows in the decade through 2012. Only Indonesia, ranking seventh, Malaysia, at fifth, and China, in first, were more corrupt in Asia.
However, unlike Indonesia and, particularly, Malaysia, Thailand has been backsliding on fighting corruption related it its international trade.
In 2012, $35.56 billion flowed out of the country illegally through misinvoicing in trade transactions - which can allow exporters and imports to keep money out of the country - and through other forms of graft, such as money laundering, smuggling and tax evasion.
That figure marked a 21.3% increase from 2011, when $29.3 million illicitly flowed out of the kingdom. Illegal capital movements totalled $24.2 billion in 2010 and just $14.8 billion in 2009.
Malaysia, since 2010, has seen corruption-related outflows drop from $62.5 billion, to $52 billion in 2011, to $48.9 billion in 2012. Indonesia, likewise, saw its illegal capital movements decline from $27.3 billion in 2008 to $20.8 billion in 2012.
Asia accounted for 40.3% of cumulative illicit financial flows from the developing world during 2003-2012. There are five Asian countries in the top ten globally: China, India, Malaysia, Indonesia, and Thailand.
Illicit financial flows averaged 3.7% of the region's GDP over this ten-year period. The vast majority of those illegal movements from Asia - 85.3% - were due to trade misinvoicing.
In total, the report put the total illegal capital movements from developing and emerging economies in 2012 at $991.2 billion, greater than the combined sum of incoming foreign investment and foreign aid in those countries.
"Emerging and developing countries haemorrhaged a trillion dollars from their economies in 2012 that could have been invested in local businesses, healthcare, education, or infrastructure," said the study's co-author, economist Joseph Spanjers. "This is a trillion dollars that could have contributed to inclusive economic growth, legitimate private-sector job creation and sound public bud
Overall, illicit financial flows around the world grew at 9.4% a year in the decade to 2012, around double the pace of economic growth, draining funds especially from impoverished countries. Over a decade, the total was $6.6 trillion, the equivalent of nearly 4% of the entire global economy. In terms of the relative size of the impact, the countries most hurt by the flows were in the Middle East and North Africa and in Sub-Saharan Africa.
The largest outflows came from giant, still poorly-regulated economies like Brazil, China, India and Russia, GFI's new report says. Money illicitly streamed out of China at a rate of about $125 billion annually over that period, for instance.
GFI said individual countries and the United Nations need to focus on cutting down such flows to fight poverty and boost growth.
"It is simply impossible to achieve sustainable global development unless world leaders agree to address this issue head-on," said GFI president Raymond Baker.
"That's why it is essential for the United Nations to include a specific target next year to halve all trade-related illicit flows by 2030 as part of post-2015 Sustainable Development Agenda."