Curbing capital flight : an analysis of Illicit financial flows in South Africa’s mining industry

Abstract

Illicit Financial Flows (IFFs) continue to undermine economic development and fiscal sovereignty across the Global South, with South Africa’s mining sector emerging as a critical locus of concern. This study interrogates the structural and legal dimensions of IFFs within the South African mining industry, aiming to assess the efficacy of the country’s legal framework in curbing these flows. Drawing on doctrinal legal analysis and policy review, the research explores how existing legislation, including tax laws, anti-money laundering statutes, and mineral governance instruments, interacts with the complex mechanisms through which facilitate IFFs such as trade mispricing, tax evasion, and illegal mining. The findings suggest that while South Africa possesses a relatively robust financial, mining and legislative framework for combating IFFs, enforcement gaps and institutional fragmentation continue to hinder its capacity to curb IFFs effectively. The study concludes by proposing targeted legal reforms and enhanced interagency coordination as pathways to strengthen financial integrity and promoting equitable resource governance in South Africa.