The Manufacturers Association of Nigeria (MAN) and the Nigerian Revenue Service (NRS) have urged corporate organisations to strengthen compliance, transparency and governance systems to curb illicit financial flows (IFFs) and protect the economy from revenue leakages.

The call was made at the Regional Sensitisation and Engagement Programme on Illicit Financial Flows for Corporate Entities under the Proceeds of Crime Act (POCA) 2022, held at MAN House in Lagos.

Speaking at the event, MAN Director-General, Segun Ajayi-Kadir, who was represented by the Director of Membership Services, Joseph Emoleke, said illicit financial flows were not merely legal issues but economic challenges with direct implications for manufacturers and the wider productive sector.

Ajayi-Kadir noted that illicit financial flows weaken investment inflows, put pressure on exchange rates, increase production costs and reduce investor confidence.

He cited the United Nations Conference on Trade and Development (UNCTAD) estimates, saying Africa loses between $80 and $90 billion yearly to IFFs, with Nigeria historically accounting for about 66 per cent of the losses concentrated in West Africa.

“Manufacturing is, by nature, a long-term commitment. Investors do not build factories on uncertainty. Serious producers cannot compete sustainably where rules are inconsistently applied or where illicit operators enjoy advantages unavailable to compliant businesses,” the DG said.

Ajayi-Kadir added that manufacturers support efforts to improve transparency and corporate governance, but stressed that regulatory systems must remain clear, predictable and business-friendly.

“Compliance systems should be designed to isolate illicit actors while enabling legitimate businesses to operate efficiently,” he said, noting that manufacturers were already contending with high energy costs, logistics bottlenecks, foreign exchange pressures and expensive financing.

Also speaking, Head of Liaison with Anti-Graft and Law Enforcement Agencies at the NRS, Idris Abdullahi, described illicit financial flows as a major threat to Nigeria’s economy and called on businesses to be active partners in addressing the challenge.

Abdullahi said the NRS currently serves as the coordinating agency for the fight against illicit financial flows in Nigeria, noting that estimates showed that Africa loses about $88.6 billion annually to illicit financial flows, with Nigeria accounting for about 65 per cent of the total.

“It is quite a challenge to our economy and it is a monster we must deal with,” he said.

Technical Consultant to the NRS, Adedayo Kayode, said illicit financial flows undermine domestic revenue mobilisation, distort competition and weaken regulatory institutions.