Morgan, a five-year-old, was playing at a dump in the Mukuru slum in Nairobi while his mother worked sorting through the rubbish. The local children often come to this dump to scavenge for food scraps or work alongside the adults. Morgan says he wasn’t at school as his family couldn’t afford it. Meanwhile, in February 2015, leaked files revealed that a small number of rich individuals connected to Kenya had stowed away around $560 million in bank accounts in Switzerland. This is the hidden, untaxed wealth-revenue that Kenya’s government needs to ensure that children like Morgan have a future.
Morgan’s case is just one example of a huge problem that is happening around the world, not just in Kenya. We face a similar dilemma at home as people accused of owning offshore companies include our prime minister’s children, senior opposition politicians and about 400 businessmen. The revelation that Prime Minister Nawaz Sharif’s family has substantial investments abroad has drawn public rage and spurred calls for accountability. In the wake of Panama leaks, the opposition parties have demonstrated unusual solidarity in what has been hailed as an historic alliance demanding explanation of hidden offshore wealth. The furious public has pressed for immediate and fair investigation of the matter.
Yet no concrete steps have been taken to investigate the matter. The ruling party has denied any illicit dealings or tax impropriety turning what could have been just another leak into a national crisis. Outright denial has been followed by painful indifference. Opposition voices have inevitably started to wane. What started out as a collective struggle for accountability seems to be reduced to Imran Khan’s lonely struggle. Despair and frustration over inaction is mounting. Time and again, history reminds us that nothing changes in Pakistan as though we are doomed to be a corrupt society. But Panama is a serious matter that should not be forgotten. And here’s why it matters.
According to recent estimates on poverty, a third of population in Pakistan lives below the poverty line. There are around 24 million children who are out of school. According to UNICEF latest figures, 44 percent children under five years of age are stunted. There are countless children like Morgan everywhere in Pakistan that serve as a brutal reminder of the vast wealth inequality in the country. Panama matters because in a country of extreme poverty and massive social challenges, the economic, social and political costs of money laundering and tax avoidance are immense. The same wealth that was shifted to Panama could have been used to provide vital public services like health and education, and to tackle rising inequality.
In a scathing criticism of Pakistani elite in his final interview before he left Pakistan, the former director of the United Nations Development Programme for Pakistan, Marc-Andre Franche, said that the only way real change could happen in this country was when the political elite would think beyond their personal interests. Political elite in Pakistan has traditionally abused power and state resources in a deeply entrenched culture of impunity. The Panama crisis has brutally exposed the severe institutional deficit as this outrage has no way of being channelled into institutional action. Weak investigations, weak investigators, weak prosecution and weak political will appear constant when scanning the past.
There is a strong belief amongst Pakistan’s ruling elite that the state owes them wealth and mansions. We were reminded by politicians in defence of the prime minister’s family that owning an offshore company is not illegal. In the wider structure of extractive institutions, the ruling elite has conveniently evaded ‘answerability’: the obligation of the government and public officials to provide information about their decisions and actions and to justify them to the public. As citizens of Pakistan, it is our moral and political right to know about the source and legality of their offshore wealth. Accountability is the defining feature of real democracies. It matters most to poor people. Poverty persists in large part because poor people are disempowered and unable to hold the powerful to account. If Panama escapes investigation like other corruption scandals in the past, there would be little hope left, if at all, of prosperity and meaningful change in Pakistan. A victory for the government in this sense would mean an unequivocal loss for the state’s institutional development. It would only serve as a precedent for the unchecked discretionary authority of democratic regimes in the future.
We all must unite in the call for accountability and fair investigation of the matter. Those who are defending the prime minister are implicitly endorsing the wider structure of extraction and pillage. In a display of blind solidarity, supporters of the ruling party are inadvertently doing unimaginable harm to long-term prospects of Pakistan. Dear fellow citizens, your support for government’s stance on Panama leaks, or inaction stand for approval of the corrupt practices that have torn this country apart. It is indeed now or never. While you may have ideological motivations or a loyalty factor to support the government, that should be no excuse for defending corruption. Remember: Pakistan does not owe us a free mansion!
The writer is lecturer in International Development for University of London International Programmes