As traditional offshore havens like Switzerland tighten regulations and financial scrutiny, African elites and companies are increasingly turning to Asian financial hubs — notably Dubai, Singapore and Hong Kong — according to a recent University of Oxford

study.

Capital flight exacts a heavy toll on African economies, with the continent haemorrhaging over $88 billion each year according to U.N. figures cited in the study. The three Asian financial centers are increasingly attractive destinations for this money and have become among “the fastest growing and most significant transnational connections for Africa.”

The study, a working paper that has not been peer-reviewed, was authored by Ricardo Soares de Oliveira, professor of political science at Sciences Po and a senior research fellow at Oxford.

The research “was motivated by the fact that African offshore links with Asian financial centres have massively increased over the past decade or so, but that there are few studies addressing this dynamic,” de Oliveira told the International Consortium of Investigative Journalists.

He said that: “While some financial centres have become more tightly regulated, and less accessible to African financial flows, other centers have come up to replace them. There is certainly no lack of supply to meet the demand, and no reason to believe that hiding money abroad has become more difficult.”

Recommended reading

role in illicit financial flows and commodity-based money laundering.

Dubai is now the fourth largest source of foreign direct investment to the continent.

The city’s proximity to Africa and extensive flight connections, combined with its developed infrastructure and glitzy image, have helped make it a destination of choice for wealthy Africans, according to the Oxford report. Beyond that, the emirate has actively lured high-net-worth individuals with tax incentives, light regulation, and financial secrecy.

The report details Dubai’s emergence as a hotspot for money laundering and illicit financial flows — a development highlighted by the Panama Papers and other investigations by the International Consortium of Investigative Journalists. As ICIJ’s Swazi Secrets investigation revealed, much of that money is laundered through gold.

According to the Oxford study, Dubai has become “the lynchpin of gold smuggling from across Africa, accounting for some 95% of the illegal trade from East and Central Africa in 2020.”

Once in Dubai, illicit gold is smelted with other gold and from there shipped to international markets.

There is certainly no lack of supply to meet the demand, and no reason to believe that hiding money abroad has become more difficult.

— Ricardo Soares de Oliveira, report author and professor at Sciences Po 

Dubai is also a notorious haven for corrupt elites and their assets, and for its reluctance to cooperate with foreign policing bodies. “If based there, the rich and powerful are almost certain to escape legal prosecution at home,” the report noted.

Among the prominent African politicians and businesspeople hiding in Dubai is Isabel Dos Santos, the daughter of Angola’s former autocrat, who continues to evade Angolan authorities. The Gupta brothers, wanted in South Africa for grand-scale corruption, also remain safe there despite South Africa’s attempts to have them extradited.

Another example of Dubai’s growing importance to African elites is the boom in real estate investments from Africa, which surged more than fourfold between 2013 and 2018.

In a sign of growing international pressure, the Financial Action Task Force — a global anti-money laundering body — placed Dubai on its “grey” list of countries under increased monitoring to address anti-money laundering deficiencies.

It was removed from the list in 2024 in a move that was seen by some as driven by geopolitical considerations. Politico reported that “a group of European countries that originally supported sanctioning the United Arab Emirates began urging the body to remove the country from the gray list last year.” This coincided with European attempts to win energy support from the Gulf after Russia’s 2022 invasion of Ukraine.

 The need for ‘truly global’ reforms

The report notes that, compared to Dubai, Singapore and Hong Kong are less popular with African elites as places to live, but these two financial centers are of growing importance to Africa’s offshore economy and offer similar laissez-faire regulation, asset protection, secrecy and tax exemptions.

With the massive expansion of Chinese interests in Africa, Hong Kong has positioned itself as a stepping stone to the African market. The study notes that Hong Kong offers “privileged access to the Chinese mainland,” ease of doing business, low regulation, and a credible common law legal system.

Many Chinese firms in Africa, notably in the corruption-prone extractive industries, rely on opaque corporate arrangements and transactions in Hong Kong. The territory’s secretive business environment enables tax avoidance and opportunities for money laundering that harm African economies, according to the report. For the same reasons, it is a favored destination for African elites to hide ill-gotten assets and as a conduit for illicit transactions.

Leaks like the Panama Papers have shed light on Hong Kong’s central role in the offshore world. The busiest offices of Mossack Fonseca, the firm at the heart of the Panama Papers, were in Hong Kong and China.

However, the Oxford report points to a recent shift away from Hong Kong due to Western corporate flight amid China’s slowing growth, Beijing’s political repression and clampdowns on foreign businesses. And according to the report, the departure of Western firms works in favor of other offshore centres, like Singapore.

g complex transactions to conceal assets and mask ownership.

Prominent African elites have relied on the services of such firms to help them hide their assets and interests behind Singapore’s secrecy laws. Among those elites, as reports from the ICIJ-led Pandora Papers investigation showed, were Zimbabwean mining magnate Billy Rautenbach, who was sanctioned at the time, and Abubakar Atiku Bagudu, a prominent Nigerian politician accused of having been complicit in the rampant looting of his country.

The rise of the three Asian offshore hubs followed tightened financial regulation in Western economies in response to the 2008 financial crisis. While Africa continues to lose billions to illicit financial flows, African governments have been ambivalent about addressing the problem. “There are many reasons for this hesitation,” de Oliveira argues, “but vested interests by those who benefit personally from offshore strategies is one of them.”

And despite the shift towards Asia, Western jurisdictions and firms remain central players in the offshore world. The offshore industry is completely interwoven and both Western and Asian offshore centers, the report notes, “function in strikingly similar manners,” while Western blue-chip companies remain key players in Asian offshore markets.

Though the rise of the trio of Asian financial hubs is widely seen as “a new post-West business arrangement” unconstrained by “good governance moralizing” and “practical barriers,” the study suggests that these trends do not signal an entirely separate and competing offshore system.  Instead, this represents the expansion and diversification of an existing global offshore network.

Reforms to curb illicit financial flows, says de Oliveira, therefore “need to be truly global.”

“If they are not, tightening up in some jurisdictions merely shifts business away to other more permissive jurisdictions. If their home countries become more demanding, Western service providers are happy to follow the business and expand their footprint in the new locations.”

Europe must take a coordinated response to fight the rising threat of transnational repression, according to a group of experts commissioned by the European Parliament to investigate ways to counter this emerging form of cross-border authoritarian coercion.

A new study commissioned by the European Parliament

, which cites ICIJ’s China Targetsinvestigation, details a set of policy recommendations for the European Union and its member states aimed at closing gaps in protection and accountability.

Chief among recommendations are the development of an EU-wide definition of transnational repression, the creation of an internal data collection and knowledge hub on the issue within the bloc, and strengthened communication channels between member states’ law enforcement agencies.

“There is a need, broadly speaking, that there be more and better data collection on transnational repression, whether it is done at the multilateral or state level,” Nate Schenkkan, the lead author of the report, told ICIJ. “The knowledge drives action, so collecting the information and disseminating it is part of the process and policy framework of forcing those other stakeholders to address the issues.”

The report recommends strengthening data protection clauses in EU laws, including identifying transnational repression as a “systemic risk” that regulated platforms are responsible for under the Digital Services Act. It also calls for more aggressive action to counter transnational repression, including visa bans, the expulsion of diplomats, and swifter mobilization of sanctions.

Recommended reading

fessor at the University of Dublin, said via email. “It, of course, infringes on the rights of victims, but it also degrades democratic participation and infringes on sovereignty. Recognizing those overlaps may help facilitate a cohesive response.”

The report cites Freedom House data on acts of transnational repression showing that, between 2014 and 2024, France, Germany and Poland were among the member states where instances of harassment were most frequently recorded. In recent years, the report said, the EU has increasingly become the site of transnational repression by proxy — including by criminal organizations, which are hired to carry out surveillance, harassment or violence.

The study highlights an uptick in transnational repression campaigns from China, Russia and Iran, echoing the findings of ICIJ’s April China Targets investigation,which exposed the sprawling scope of Beijing’s campaign to silence criticism abroad.

The investigation revealed how the Chinese government had misused international institutions like the United Nations and Interpol to target overseas dissidents, often without interference from democratic nations. Some of the 105 victims interviewed by ICIJ and its 42 media partners recalled family members being threatened, being doxxed, or having their bank accounts suspended.

>

The report notes that, “compared to the actions taken against Russia and Iran, European responses to China’s use of transnational repression appear to have been weaker.”

That could in part be due to the close economic ties many countries have fostered with China, which have taken on new significance as trade with the U.S. grows volatile, said Emile Dirks, a co-author of the report and senior research associate at the University of Toronto’s Citizen Lab.

“Many Democratic states, including within the European Union, are also looking to maintain workable relations with China in a range of areas, trade being one of them,” Dirks said. “The dynamics are not necessarily there when it comes to say Iran or even Russia.”

members in China during Xi Jinping’s state visit to France in May 2024 to tamp down public demonstrations in Paris.

The authors, who interviewed several victims, also advocated for greater resources and support systems for the targets of such campaigns — many of whom have tenous immigration status and may not trust or be able to access resources in their host countries. 

“This is not an abstract issue,” Dirks said. “For many people, this is a human rights problem that they face day in and day out, and that failure to address this problem will have real human consequences for those individuals and their wider communities.”