China has topped the list of countries with illegal money leaving its borders, according to Global Financial Integrity. And the amount of money flowing out of the country is destabilizing its economy.
The Washington based group says in 2010, 150 developing countries lost nearly 1 trillion dollars in dirty money. These are usually illegal gains from corruption, tax evasion and other financial crimes not involving cash transactions.
China accounted for nearly 50% of the outflow. In 2010, more than $420 billion illegal money left China. During the decade leading up to 2010, the figure was $2.7 trillion.
The amount is increasing, according GFI. It says in 2011, $602 billion dollars of dirty money were transferred out of China.
Global Financial Integrity says the money is flowing into offshore tax haven and banks in developed countries.
Dev Kar, the economist who compiled the report, warns that the figures show the Chinese economy is a, quote, "ticking time bomb". The amount of money leaving the country threatens the stability of the country's social, economic and political order.
GFI says the money leaving developing countries could otherwise be invested to improve healthcare, education, and infrastructure. The group called on world's leaders to adopt measures to curb illicit money outflows.
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