Thursday, December 29, 2016

Major Chinese projects in sub-Saharan Africa in 2016 ecns

From electrified railways to hydro power plants, a number of Chinese projects continued to spring up and boost development in Africa this year amid blossoming Sino-African cooperation.
The following is a Xinhua review on major Chinese-built or Chinese-funded infrastructure projects that began or finished construction in sub-Saharan Africa in 2016:
ETHIOPIA-DJIBOUTI RAILWAY
Ethiopia on Oct. 5 launched its first electrified railway linking its capital and Djibouti, with officials hailing the Chinese-built rail as the latest testament to the Sino-African friendship.
The 752.7-km Ethiopia-Djibouti railway, also known as Addis Ababa-Djibouti railway, will avail landlocked Ethiopia a faster access to the sea (via Djibouti port), reducing travel time from seven days on roads to about 10 hours.
The railway was hailed by Chinese Vice Premier Wang Yang as the "Tazara railway in a new era," referring to the railway linking Tanzania's Dar es Salaam with Zambia's Kapiri Mposhi that China sent over 50,000 workers to build in the 1970s despite its own economic difficulties.
Constructed by China Railway Group and China Civil Engineering Construction Corporation, the railway features the use of a complete sets of Chinese equipment and standards. It is also the second trans-national railway built by Chinese in Africa, following the Tazara.
NAIROBI-NAIVASHA RAILWAY
Kenya on Nov. 19 launched the Nairobi-Naivasha Standard Gauge Railway (SGR) Project, being built by China Communications Construction Company (CCCC) and funded by China's Exim Bank.
The project is the phase A of Nairobi-Malaba SGR Project and an extension of the Nairobi-Mombasa SGR. The 120.4-km line starts from the Kenyan capital city to Malaba, a border city between Kenya and Uganda.
Speaking at the launch ceremony, Kenyan President Uhuru Kenyatta said the modern railway line would catalyze Kenya's industrial transformation and position the country as an investment hub.
ABUJA-KADUNA RAILWAY
The Abuja-Kaduna standard gauge railway, linking Nigeria's capital Abuja and the northwestern state of Kaduna, was open for commercial operation in July.
The 186.5-km line was built by China Civil Engineering Construction Corporation with nine stations and a designed speed of 150 km per hour.
The railway is part of the railway modernization initiative by Nigeria to replace the existing narrow gauge system with the wider standard gauge system, while allowing high-speed train operations on the railway network.
NYERERE BRIDGE
Tanzania's commercial capital Dar es Salaam added a new urban landmark on April 19 when the Chinese-built Nyerere Bridge, or Kigamboni Bridge, opened to traffic as the largest cable-stayed cross-sea bridge in East Africa.
The 680-meter-long, six-lane bridge now offers a shortcut from Dar es Salaam's CBD to the Kigamboni district. Prior to its opening, many local residents have relied on wooden boat ferry to cross the creek separating the two places.
Tanzanian President John Magufuli has named the bridge Nyerere in recognition of the country's founding leader -- Julius Nyerere.
It was built by China Railway Construction Engineering Group in a joint venture with China Railway Major Bridge Group.
GIBE III HYDRO POWER PLANT
Ethiopia on Dec. 17 inaugurated the Gibe III hydro power plant, which will further enhance the country's reputation as a hydro powerhouse in East Africa.
The Gibe III project boasts a generating capacity of 1,870 MW, which will raise Ethiopia's power generation capacity to more than 4,260 MW.
Located in the Southern Regional State, Gibe III has been contracted by Salini Impregilo of Italy for the civil works, and Dong Fang Electric Corp. of China for the electromechanical works. A loan from the Industrial and Commercial Bank of China (ICBC) financed 60 percent of the cost.
VICTORIA FALLS AIRPORT
Zimbabwe's Victoria Falls International Airport, upgraded and expanded with support from China, was commissioned on Nov. 18 with the hope of ushering in more tourists to the country.
The upgraded airport can now handle 1.5 million passengers per year, up from 500,000, and boasts new facilities including a new international terminal building, a new 4-km runway, extended parking areas for aircraft and new road networks.
The airport is the gateway to Victoria Falls, a world heritage site.
The project was done by China Jiangsu International and financed through a 150-million-U.S.-dollar-loan from China EXIM Bank.
TEMA PORT AND KOTOKURABA MARKET
Ghana's eastern port of Tema on Nov. 16 began expansion, undertaken by the China Harbor Engineering Company, amid a drive to become a more efficient gateway to Africa.
Under the project, a total of 120 hectares of land would be reclaimed from the sea. The project will also see the upgrading of the two-lane Tema-Accra Expressway into a six-lane road to ease traffic flow.
Ghana on Nov. 29 commissioned the new Kotokuraba market, whose construction was financed by China EXIM Bank and undertaken by China Railway Construction Engineering Group.
The market in the ancient capital Cape Coast features modern facilities including a 200-capacity parking lot, a solar system for emergency lighting and CCTV security cameras.
The market renovation and construction is expected to ease congestion in the former Kotokuraba market, which had suffered two major fires with heavy losses.
BURUNDI'S DIGITAL TV MIGRATION
Burundi on Dec. 19 inaugurated a digital television project by Chinese media company StarTimes after its construction completed. The project has helped Burundi to become the first in the East African Community to achieve a complete migration from analog to digital television.
The project will allow broadcasting of high-quality images and sounds and a wider national, regional and international coverage of the Burundi national television.
On the same day, Chinese tech giant Huawei also marked the completion of its metropolitan area network project in Burundi, which involves laying 220 km optical fiber in the capital Bujumbura

Major Chinese projects in sub-Saharan Africa in 2016-ecns

Major Chinese projects in sub-Saharan Africa in 2016 1 2016-12-29 16:38XinhuaEditor: Li Yan ECNS App Download From electrified railways to hydro power plants, a number of Chinese projects continued to spring up and boost development in Africa this year amid blossoming Sino-African cooperation. The following is a Xinhua review on major Chinese-built or Chinese-funded infrastructure projects that began or finished construction in sub-Saharan Africa in 2016: ETHIOPIA-DJIBOUTI RAILWAY Ethiopia on Oct. 5 launched its first electrified railway linking its capital and Djibouti, with officials hailing the Chinese-built rail as the latest testament to the Sino-African friendship. The 752.7-km Ethiopia-Djibouti railway, also known as Addis Ababa-Djibouti railway, will avail landlocked Ethiopia a faster access to the sea (via Djibouti port), reducing travel time from seven days on roads to about 10 hours. The railway was hailed by Chinese Vice Premier Wang Yang as the "Tazara railway in a new era," referring to the railway linking Tanzania's Dar es Salaam with Zambia's Kapiri Mposhi that China sent over 50,000 workers to build in the 1970s despite its own economic difficulties. Constructed by China Railway Group and China Civil Engineering Construction Corporation, the railway features the use of a complete sets of Chinese equipment and standards. It is also the second trans-national railway built by Chinese in Africa, following the Tazara. NAIROBI-NAIVASHA RAILWAY Kenya on Nov. 19 launched the Nairobi-Naivasha Standard Gauge Railway (SGR) Project, being built by China Communications Construction Company (CCCC) and funded by China's Exim Bank. The project is the phase A of Nairobi-Malaba SGR Project and an extension of the Nairobi-Mombasa SGR. The 120.4-km line starts from the Kenyan capital city to Malaba, a border city between Kenya and Uganda. Speaking at the launch ceremony, Kenyan President Uhuru Kenyatta said the modern railway line would catalyze Kenya's industrial transformation and position the country as an investment hub. ABUJA-KADUNA RAILWAY The Abuja-Kaduna standard gauge railway, linking Nigeria's capital Abuja and the northwestern state of Kaduna, was open for commercial operation in July. The 186.5-km line was built by China Civil Engineering Construction Corporation with nine stations and a designed speed of 150 km per hour. The railway is part of the railway modernization initiative by Nigeria to replace the existing narrow gauge system with the wider standard gauge system, while allowing high-speed train operations on the railway network. NYERERE BRIDGE Tanzania's commercial capital Dar es Salaam added a new urban landmark on April 19 when the Chinese-built Nyerere Bridge, or Kigamboni Bridge, opened to traffic as the largest cable-stayed cross-sea bridge in East Africa. The 680-meter-long, six-lane bridge now offers a shortcut from Dar es Salaam's CBD to the Kigamboni district. Prior to its opening, many local residents have relied on wooden boat ferry to cross the creek separating the two places. Tanzanian President John Magufuli has named the bridge Nyerere in recognition of the country's founding leader -- Julius Nyerere. It was built by China Railway Construction Engineering Group in a joint venture with China Railway Major Bridge Group. GIBE III HYDRO POWER PLANT Ethiopia on Dec. 17 inaugurated the Gibe III hydro power plant, which will further enhance the country's reputation as a hydro powerhouse in East Africa. The Gibe III project boasts a generating capacity of 1,870 MW, which will raise Ethiopia's power generation capacity to more than 4,260 MW. Located in the Southern Regional State, Gibe III has been contracted by Salini Impregilo of Italy for the civil works, and Dong Fang Electric Corp. of China for the electromechanical works. A loan from the Industrial and Commercial Bank of China (ICBC) financed 60 percent of the cost. VICTORIA FALLS AIRPORT Zimbabwe's Victoria Falls International Airport, upgraded and expanded with support from China, was commissioned on Nov. 18 with the hope of ushering in more tourists to the country. The upgraded airport can now handle 1.5 million passengers per year, up from 500,000, and boasts new facilities including a new international terminal building, a new 4-km runway, extended parking areas for aircraft and new road networks. The airport is the gateway to Victoria Falls, a world heritage site. The project was done by China Jiangsu International and financed through a 150-million-U.S.-dollar-loan from China EXIM Bank. TEMA PORT AND KOTOKURABA MARKET Ghana's eastern port of Tema on Nov. 16 began expansion, undertaken by the China Harbor Engineering Company, amid a drive to become a more efficient gateway to Africa. Under the project, a total of 120 hectares of land would be reclaimed from the sea. The project will also see the upgrading of the two-lane Tema-Accra Expressway into a six-lane road to ease traffic flow. Ghana on Nov. 29 commissioned the new Kotokuraba market, whose construction was financed by China EXIM Bank and undertaken by China Railway Construction Engineering Group. The market in the ancient capital Cape Coast features modern facilities including a 200-capacity parking lot, a solar system for emergency lighting and CCTV security cameras. The market renovation and construction is expected to ease congestion in the former Kotokuraba market, which had suffered two major fires with heavy losses. BURUNDI'S DIGITAL TV MIGRATION Burundi on Dec. 19 inaugurated a digital television project by Chinese media company StarTimes after its construction completed. The project has helped Burundi to become the first in the East African Community to achieve a complete migration from analog to digital television. The project will allow broadcasting of high-quality images and sounds and a wider national, regional and international coverage of the Burundi national television. On the same day, Chinese tech giant Huawei also marked the completion of its metropolitan area network project in Burundi, which involves laying 220 km optical fiber in the capital Bujumbura. Related news Media gets a new look at Chinese companies in Africa2016-11-29 StarTimes DTV set to dominate Africa2016-11-29 China's role in Africa grows in Ebola's wake2016-10-27

Friday, December 16, 2016

Trump likely to trim official aid to Kenya, report suggests | The Star, Kenya

US President-elect Donald Trump with outgoing President Barack Obama in the Oval Office of the White House in Washington on November 10 /REUTERS
US President-elect Donald Trump with outgoing President Barack Obama in the Oval Office of the White House in Washington on November 10 /REUTERS
The US is likely to cut a multibillion-shilling annual aid to Kenya under the Donald Trump presidency, a new report suggested yesterday.
The Economic Insight: Africa Q4 2016 report, commissioned by the Institute of Chartered Accountants in England and Wales, says there are signs of the Trump's administration adopting an expansionary fiscal policy. This, coupled with spending cuts to accommodate increased budget for infrastructure development, is likely to cut off official aid streams to Africa, the accountancy and finance body warns.
The analytical report – produced by macroeconomic and industrial development forecaster Oxford Economics – focused on Kenya, Tanzania, Ethiopia, Nigeria, Ghana, Ivory Coast, South Africa and Angola.
“A Trump presidency raises the risk of the world’s largest economy reining in development aid thus affecting dependent countries such as Ethiopia, Kenya, Tanzania, Nigeria and DRC,” ICAEW said in a press statement.
The US is Africa's largest bilateral official aid benefactor with an inflow of about $9 billion (about Sh918.90 billion), followed by the UK ($4 billion or Sh408.40 billion) and France ($2 billion or about Sh204.20 billion), the estimates by the Organisation for Economic Co-operation and Development for 2015 shows.
Official development aid receipts into East Africa were largest in Ethiopia at $3.5 billion (about Sh357.35 billion), followed by Kenya at $2.5 billion (Sh255.25 billion). Official aid to Tanzania and Uganda was estimated at $1.5 billion (Sh153.15 billion) each.
“Aid is one of the main channels through which a change in US policy under the new president could impact Africa,” ICAEW regional director for Middle East, Africa and South Asia Michael Armstrongsaid in the statement. “Policymakers and businesses across the continent will be keen to see President-elect Trump’s plans for development policies once he takes office (from January 20).”
Taxation revenues are, however, the main financier of the Kenya government's annual budget. For this financial year's Sh2.02 trillion budget, for example, 65.84 per cent (or Sh1.33 trillion) is expected to be funded by the taxpayers, estimates by the National Treasury indicates. Loans and grants from foreign governments and international organisations are this year estimated at Sh67.27 billion – comprised of Sh50.45 billion in projected loans and Sh16.82 billion in grants.
In the four months to October, the Treasury received Sh11.88 billion in foreign loans and Sh1.31 billion in grants, the statement of Actual Revenues and Net Exchequer Issues shows.
The Trump's administration could also affect trade relations with Africa through Africa Growth and Opportunity Act framework, analysts at ICAEW say. Trade volumes between the US and Africa have been dwindling, hurt by shale boom which cut the need for crude oil.
“Trade is another channel likely to be affected by the new US administration,” Armstrong said. “Considering the president-elect’s protectionist stance, African economies could be harmed by tighter policies towards agricultural and manufacturing trade.”
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Thursday, June 23, 2016

Djibouti faces new kid on the block when Ethiopia turns to Barbara


  • 23 June 2016
  •  
  • From the sectionBusiness


Berbera has a long way to go before rivalling Djibouti. For now, many of the boats using its quays are simple dhows from Yemen, and slightly larger boats shipping a ragged assortment of goodsImage copyrightJAMES JEFFREY
Image captionBerbera has a long way to go before rivalling Djibouti


Despite Ramadan, there is no slackening at Djibouti's ports. Under the relentless sun, whippet-thin men glistening with sweat work the docks, taking what refuge they can in the shade cast by machinery and stacks of cargo.
By contrast, things are much quieter 300km southwards in Berbera, on the Somaliland coast, where dhows from Yemen carrying crates of onions moor alongside a few larger, more modern ships.
But Berbera Port's more sedate pace is set to change drastically. In May, Dubai-based DP World was awarded the concession to manage and expand Berbera for 30 years, a project valued at about $442m (£302m).
The deal could return Berbera to a major Horn of Africa trading hub, providing competition for Djibouti, which has come to dominate trade in the region during the last decade.


Berbera has a long way to go before rivalling Djibouti. For now, many of the boats using its quays are simple dhows from Yemen, and slightly larger boats shipping a ragged assortment of goodsImage copyrightJAMES JEFFREY
Image captionMany boats currently using Berbera Port are simple dhows from Yemen


But those running Djibouti's ports are not overly concerned. In fact, they seem to welcome Berbera's renaissance.
"East Africa needs more ports. We want the region to get more done," says Aboubaker Omar, chairman and chief executive of Djibouti Ports and Free Zones Authority (DPFZA). "Berbera is welcome to come and share the business."
Africa contains 17 landlocked countries, with those toward the continent's east coast having fewer port options than those nearer the west coast, Mr Omar explains.
Between Port Sudan to the north of the Horn of Africa, and Mombasa to the south - a total of 6,000km of coastline - Djibouti is the only other major port.


Djibouti portImage copyrightJAMES JEFFREY
Image captionDjibouti's port authority does not feel threatened by Berbera's possible renaissance


"There is no competition, so you hear people talking of Djibouti having a monopoly," Mr Omar says. "That's not accurate, we even handle shipping for countries with ports, but with more options people can compare and then appreciate our performance."

Banking on Berbera

DP World's gambit is the biggest single investment in the self-declared but internationally unrecognised republic, representing both an economic and political boon to Somaliland.
Cut off from global financial institutions, Somaliland's government operates on a budget of about $250m, with the private sector responsible for rebuilding much of the country's infrastructure since the end of a civil war with Somalia in 1991 that left 90% of the capital, Hargeisa, in ruins.
For now, the country's fragile economy survives on huge remittances from its diaspora and by exporting vast quantities of livestock to the Middle East.
"The government does not have the funds to develop the port," says Ali Omer, general manager of Berbera Port Authority. "This agreement will benefit the Horn of Africa and boost trade with Arab countries."
According to the deal, Dubai will also support Somaliland's fisheries industry, which has about 850km of coastline waiting to be tapped, and help refurbish the ramshackle 268km road running from Berbera to the border with Ethiopia.
And Ethiopia could just be the start.


Ethiopian truckers waiting in the shade in Djibouti before setting off back to Ethiopia with imported goodsImage copyrightJAMES JEFFREY
Image captionEthiopian truckers will have more options if Berbera grows to rival Djibouti


"It would be a gateway to Africa, not just Ethiopia," says Sharmarke Jama, a trade and economic adviser for the Somaliland government involved in negotiations on the port deal. "The multiplying benefits for Somaliland's economy could be endless."

Ethiopian catalyst

"Ethiopia is the region's locomotive," says Ethiopia-born Dawit Gebre-Ab, director of Europe and North America for DPFZA, who this month will receive an MBE for promoting trade relations between the UK and Djibouti. "With its expansion in manufacturing, Ethiopia could become the China of Africa."
That means a lot of goods and raw materials in transit. Already about 90% of Ethiopia's trade goes through Djibouti: in 2005, this amounted to two million tonnes and now stands at 11 million tonnes. During the next three years, it is set to increase to 15 million tonnes.
Ethiopia's apparently relentless expansion relies on access to the sea: a source of immense strategic anxiety ever since Ethiopia lost its only port to Eritrean independence in 1993.
As a result, Ethiopia has long been looking to assuage its dependence on Djibouti, which scoops at least $300m in port fees from it every year.
Ethiopia has strengthened bilateral relations with Somaliland, signing various memoranda of understanding (MOUs) during the past couple of years, including one stipulating about 30% of its imports shifting to Berbera.
"There's enough going on in this region for Berbera to get used without causing Djibouti problems," says Ali Toubeh, a Djiboutian entrepreneur whose container company is based in Djibouti's free trade zone. "Demand from Ethiopia will get so big, they're going to need Port Sudan and Kismayo [in Somalia] too."

Horn of Africa ports



Africa ports



Meanwhile, a new 756km railway running between Ethiopia and Djibouti, with further railway lines and joint projects such as an oil pipeline in development, testify to the two countries continuing to remain firmly integrated partners.

Port of the moment

The Horn of Africa coastline has seen ports come and go in importance throughout history, often because of external influences.
Zeila, now a small sleepy rundown town on Somaliland's coast, dominated trade for hundreds of years until a power shift within then-Abyssinia - present-day Ethiopia - saw Berbera gain in importance during the 16th Century.
Suakin, on the Sudan coast, once flourished until subsiding into irrelevance by the end of the 19th Century, when the British preferred to develop Port Sudan, since its deeper waters could take larger ships.
During the early 1990s Djibouti Port emerged as an important transhipment hub of containers for the Red Sea ports of Aden, Assab, Massawa and Port Sudan. It then grew even faster after 2000 when it came under foreign management - DP World, no less.
There is palpable hope and excitement in Somaliland about what the DP World deal could achieve, reflective of a trend across much of the Horn of Africa.


The 268km ramshackle road running from Berbera to the border with Ethiopia needs a lot of work before it can handle the sort of volume of trade traffic that Somaliland hopes for from the deal with DP WorldImage copyrightJAMES JEFFREY
Image captionThe road from Berbera to the border with Ethiopia needs a lot of work


Increasing economic integration between the likes of Ethiopia, Djibouti and Somaliland is bringing mutual benefits and stability to a part of the world long known for the opposite.
"The Horn of Africa has made dramatic progress in the past two decades," says Matt Bryden, a Horn of Africa political analyst and executive chairman of Sahan Research, a Nairobi-based research institute. "But there remain numerous challenges."
These include Somalia cementing stable governance, resolving the question over Somaliland's statehood, the "cold peace" between Ethiopia and Eritrea, and Ethiopia's balancing act between its commitment to developmental state ideology and democratisation and human rights.
But it appears there is room for cautious optimism.
"Economic integration will eventually benefit Somalia," Mr Bryden says. "Eritrea will inevitably be drawn into closer economic union with the wider Horn of Africa region as well."

Tuesday, April 5, 2016

Panama Papers: Mossack Fonseca leak reveals elite's tax havens



A huge leak of documents has lifted the lid on how the rich and powerful use tax havens to hide their wealth. The files were leaked from one of the world's most secretive companies, a Panamanian law firm called Mossack Fonseca.

What are the Panama Papers?

The files show how Mossack Fonseca clients were able to launder money, dodge sanctions and avoid tax.
In one case, the company offered an American millionaire fake ownership records to hide money from the authorities. This is in direct breach of international regulations designed to stop money laundering and tax evasion.
It is the biggest leak in history, dwarfing the data released by the Wikileaks organisation in 2010. For context, if the amount of data released by Wikileaks was equivalent to the population of San Francisco, the amount of data released in the Panama Papers is the equivalent to the population of India.

Who is in the papers?

There are links to 12 current or former heads of state in the data, including dictators accused of looting their own countries.
More than 60 relatives and associates of heads of state and other politicians are also implicated.
The files also reveal a suspected billion-dollar money laundering ring involving close associates of Russia's President, Vladimir Putin.
Also mentioned are the brother-in-law of China's President Xi JinpingUkrainePresident Petro PoroshenkoArgentina President Mauricio Macri; the late father of UK Prime Minister David Cameron and three of the four children of Pakistan's Prime Minister Nawaz Sharif.
The documents show that Iceland's Prime Minister, Sigmundur Gunnlaugsson, had an undeclared interest linked to his wife's wealth. He is now facing calls for his resignation.
Part of the documents suggest that a key member of Fifa's ethics committee,Uruguayan lawyer Juan Pedro Damiani, and his firm provided legal assistance for at least seven offshore companies linked to a former Fifa vice-president arrested last May as part of the US inquiry into football corruption.

How do tax havens work?







Aerial view of the Panama City bay taken on March 23, 2015Image copyrightAFP/getty Images
Image captionPanama is one of a number of popular tax havens in the Caribbean


Although there are legitimate ways of using tax havens, most of what has been going on is about hiding the true owners of money, the origin of the money and avoiding paying tax on the money.
Some of the main allegations centre on the creation of shell companies, that have the outward appearance of being legitimate businesses, but are just empty shells. They do nothing but manage money, while hiding who owns it.
One of the media partners involved in the investigation, McClatchy, has more on how shell companies work in this video.

What do those involved have to say?

Mossack Fonseca says it has operated beyond reproach for 40 years and never been accused or charged with criminal wrong-doing.
Mr Putin's spokesman Dmitry Peskov said the reports were down to "journalists and members of other organisations actively trying to discredit Putin and this country's leadership". Publication of the leaks may be down to "former employees of the State Department, the CIA, other security services," he said.
In an interview with a Swedish television channel, Mr Gunnlaugsson said his business affairs were above board and broke off the interview.
Fifa said it is now investigating Mr Damiani, who told Reuters on Sunday that he broke off relations with the Fifa member under investigation as soon as the latter had been accused of corruption.

Who leaked the Panama Papers?

The 11.5m documents were obtained by the German newspaper Sueddeutsche Zeitung and shared with the International Consortium of Investigative Journalists (ICIJ).
The ICIJ then worked with journalists from 107 media organisations in 76 countries, including UK newspaper the Guardian, to analyse the documents over a year.
The BBC does not know the identity of the source.
BBC graphic comparing size of Panama Papers data leak to other recent leaks

In all, the details of 214,000 entities, including companies, trusts and foundations, were leaked.
The information in the documents dates back to 1977, and goes up to December last year. Emails make up the largest type of document leaked, but images of contracts and passports were also released.

How can I read the papers?

So far, a searchable archive is not available at the moment.
There is a huge amount of data, and much of it reportedly includes personal information (including passport details), and does not necessarily include those suspected of criminal activity.
Having said that, there is plenty of information out there. The ICIJ has put together a comprehensive list of the main figures implicated here - you can also search by country.
You can sign up on the ICIJ's website for any major updates on the Panama Papers here.
Panama Papers: Full coverage; follow reaction on Twitter using #PanamaPapers; in the BBC News app, follow the tag "Panama Papers"
  • Watch Panorama on the BBC iPlayer (UK viewers only)----------------








The Panama Papers are an unprecedented leak of 11.5m files from the database of the world’s fourth biggest offshore law firm, Mossack Fonseca. The records were obtained from an anonymous source by the German newspaper Süddeutsche Zeitung, which shared them with the International Consortium of Investigative Journalists (ICIJ). The ICIJ then shared them with a large network of international partners, including the Guardian and the BBC.

What do they reveal?

The documents show the myriad ways in which the rich can exploit secretive offshore tax regimes. Twelve national leaders are among 143 politicians, their families and close associates from around the world known to have been using offshore tax havens.
A $2bn trail leads all the way to Vladimir Putin. The Russian president’s best friend – a cellist called Sergei Roldugin – is at the centre of a scheme in which money from Russian state banks is hidden offshore. Some of it ends up in a ski resort where in 2013 Putin’s daughter Katerina got married.
Among national leaders with offshore wealth are Nawaz Sharif, Pakistan’s prime minister; Ayad Allawi, ex-interim prime minister and former vice-president of Iraq; Petro Poroshenko, president of Ukraine; Alaa Mubarak, son of Egypt’s former president; and the prime minister of Iceland, Sigmundur Davíð Gunnlaugsson.
An offshore investment fund run by the father of British prime minister David Cameron avoided ever having to pay tax in Britain by hiring a small army of Bahamas residents to sign its paperwork. The fund has been registered with HM Revenue and Customs since its inception and has filed detailed tax returns every year.
A lengthier overview of the revelations can be found here.

What is Mossack Fonseca?

It is a Panama-based law firm whose services include incorporating companies in offshore jurisdictions such as the British Virgin Islands. It administers offshore firms for a yearly fee. Other services include wealth management.

Where is it based?

The firm is Panamanian but runs a worldwide operation. Its website boasts of a global network with 600 people working in 42 countries. It has franchises around the world, where separately owned affiliates sign up new customers and have exclusive rights to use its brand. Mossack Fonseca operates in tax havensincluding Switzerland, Cyprus and the British Virgin Islands, and in the British crown dependencies Guernsey, Jersey and the Isle of Man.








How big is it?

Mossack Fonseca is the world’s fourth biggest provider of offshore services. It has acted for more than 300,000 companies. There is a strong UK connection. More than half of the companies are registered in British-administered tax havens, as well as in the UK itself.

How much data has been leaked?

A lot. The leak is one of the biggest ever – larger than the US diplomatic cables released by WikiLeaks in 2010, and the secret intelligence documents given to journalists by Edward Snowden in 2013. There are 11.5m documents and 2.6 terabytes of information drawn from Mossack Fonseca’s internal database.








Are all people who use offshore structures crooks?

No. Using offshore structures is entirely legal. There are many legitimate reasons for doing so. Business people in countries such as Russia and Ukraine typically put their assets offshore to defend them from “raids” by criminals, and to get around hard currency restrictions. Others use offshore for reasons of inheritance and estate planning.

Are some people who use offshore structures crooks?

Yes. In a speech last year in Singapore, David Cameron said “the corrupt, criminals and money launderers” take advantage of anonymous company structures. The government is trying to do something about this. It wants to set up a central register that will reveal the beneficial owners of offshore companies. From June, UK companies will have to reveal their “significant” owners for the first time.

What does Mossack Fonseca say about the leak?

The firm won’t discuss specific cases of alleged wrongdoing, citing client confidentiality. But it robustly defends its conduct. Mossack Fonseca says it complies with anti-money-laundering laws and carries out thorough due diligence on all its clients. It says it regrets any misuse of its services and tries actively to prevent it. The firm says it cannot be blamed for failings by intermediaries, who include banks, law firms and accountants.
Panama Papers reporting team: Juliette Garside, Luke Harding, Holly Watt, David Pegg, Helena Bengtsson, Simon Bowers, Owen Gibson and Nick Hopkins