FRANCOPHONE AFRICA | African Development Bank (AfDB) Strengthens CAR’s Fight Against Illicit Financial Flows and Poor Resource Loan Governance

The African Development Bank Group (AfDB) has wrapped up a high-level workshop in Bangui, Central African Republic (CAR), aimed at building national capacity to combat illicit financial flows (IFFs) and tighten governance around resource-backed loans – a financing tool increasingly used across Africa but fraught with risk.

Held from June 10–13 2025, under the theme “Harnessing Africa’s Wealth: Curbing Illicit Financial Flows for Resilient Growth and Development,” the event convened 80 key stakeholders across government ministries, civil society, and the private sector. The initiative was led by the Bank’s African Development Institute (ADI) and Natural Resources Management and Investment Centre (ECNR) under the GONAT programme, which targets better natural resource governance in fragile states.

Why It Matters

Illicit financial flows cost Africa an estimated $88 billion annually, draining resources that could fund roads, healthcare, education, and innovation. For CAR – a country rich in gold, diamonds, and uranium but plagued by instability and weak institutions – the stakes are especially high.

“Without enhanced oversight, institutional capacity, and sound strategic planning, natural resources can become a source of political instability, illicit activities, and unsustainable debt,” said Rufin Benam Beltoungou, Minister of Mines and Geology.

In 2023, the CAR introduced a controversial tokenization law which facilitated the establishment of businesses by both citizens and foreigners streamlining the process of obtaining licenses in sectors such s real estate, agriculture, natural resources exploitation, and forestry.

As reported by BitKE, the above legislation came after CAR revealed its intentions to tokenize its natural resources in 2022 under a master-plan dubbed ‘Project Sango’ which also came with its own cryptocurrency, the SANGO COIN.

Spotlight on Resource-Backed Loans

Panelists expressed concern over the increasing reliance on resource-backed loans (RBLs) – financial instruments collateralized by a country’s natural resources.

While useful for funding critical infrastructure, they can become debt traps if not transparently structured and monitored.

“Resource-backed loans can finance hospitals and schools, but repayment terms can be risky when the country lacks proper resource accounting,” noted Médard Goudozoui, a geological engineer.

The sessions equipped participants with tools to trace and address IFFs, including:

• The Partner Country Method for trade misinvoicing
• Use of indices like the Financial Secrecy Index and Corruption Perceptions Index
• Techniques to detect under- or over-valuation of exports, especially in the gold and diamond sectors

Gender and Governance

The workshop also emphasized inclusive governance, with the GONAT initiative aiming for at least 40% female participation.

“Women are central to affected communities. Their involvement enhances transparency, fairness, and social cohesion,” said Alexia Molotouala, Head of Division, Kimberley Process Secretariat.

“Sustainable change is only possible when women and local communities shape policy,” added Mamady Souaré, AfDB Country Manager for CAR.

Dr. Eric Ogunleye, Director of the African Development Institute, said the tools introduced would help CAR establish better control over its resource flows and borrowing decisions.

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