The International Monetary Fund (IMF) has issued a stern warning to Nigeria and other emerging economies to step up efforts in curbing illicit financial flows (IFFs), stressing that unchecked movement of dirty money poses serious threats to financial stability, governance, and international credibility.
IMF Managing Director Kristalina Georgieva delivered the caution during a Civil Society Town Hall meeting held on the sidelines of the IMF–World Bank Annual Meetings in Washington, D.C., on Monday.
Georgieva emphasized that illicit financial flows — often linked to corruption, tax evasion, terrorism financing, and money laundering — drain critical resources from developing nations, exacerbate inequality, and undermine confidence in public institutions.
“Illicit financial flows weaken economies, corrode trust in governance, and divert resources away from essential priorities such as health, education, and infrastructure,” Georgieva said. “Countries must strengthen anti–money-laundering systems and enhance transparency to protect financial stability and attract sustainable investment.”
She noted that emerging markets like Nigeria, which are battling high debt levels and weak institutional frameworks, face heightened risks from cross-border financial crimes if regulatory systems are not reinforced.
The IMF chief highlighted that building robust governance structures, enforcing transparency in fiscal management, and improving coordination between financial intelligence units and global partners are crucial to tackling the challenge.
According to IMF data, developing nations lose an estimated $200 billion to $600 billion annually through illicit outflows, undermining their capacity to meet development targets and service public debt.
Georgieva also called for stronger international collaboration, urging developed economies and global financial institutions to assist emerging markets with capacity building, digital monitoring systems, and technical expertise to trace and recover stolen assets.
“Addressing illicit flows is not just a national priority — it’s a shared global responsibility,” she added. “Transparency and accountability are the foundations of economic resilience.”
Analysts say the IMF’s warning is particularly significant for Nigeria, which continues to grapple with issues of capital flight, weak anti-corruption enforcement, and opaque financial reporting systems. The country has in recent years faced scrutiny over money-laundering concerns within its political and banking sectors.
The IMF reiterated its commitment to working with member nations to strengthen governance reforms, support anti-corruption measures, and enhance institutional accountability — key pillars for restoring investor confidence and driving inclusive growth across emerging economies.
