## The Dark Side of the Global Economy – IMF F&D

## Source details

**Canonical URL:** [The Dark Side of the Global Economy – IMF F&D](https://www.imf.org/en/publications/fandd/issues/2019/09/dark-side-of-the-global-economy-lipton)

## Other formats

- [Markdown version](/en/publications/fandd/issues/2019/09/dark-side-of-the-global-economy-lipton/index.md)
- [Structured JSON version](/en/publications/fandd/issues/2019/09/dark-side-of-the-global-economy-lipton/index.json)
- [Bundle manifest](/en/publications/fandd/issues/2019/09/dark-side-of-the-global-economy-lipton/bundle-manifest.json)

## Bibliographic details
- Authors: DAVID LIPTON
- Published: September 1, 2019

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### Overview
- Acting IMF Managing Director David Lipton discusses the dark side of the global economy and argues that bringing money out of the shadows requires improving governance.
- Global GDP last year was $87 trillion, up from just $11 trillion in 1980.
- The piece highlights how hidden wealth and illicit flows undermine public revenues, trust in government, and the ability to address inequality and poverty.

### Key statistics and figures
- $87 trillion — Global GDP last year.
- $11 trillion — Global GDP in 1980.
- $7 trillion — Amount of private wealth estimated to be hidden in offshore financial centers; described as equal to 8 percent of global GDP.
- 8 percent — Share of global GDP represented by the $7 trillion hidden private wealth.
- $1 trillion — The gain in government revenue, by one calculation, that could be achieved by reducing corruption around the world by one-third.
- one-third — Among low-income countries, the share of the budget dedicated to education and health is one-third lower in more corrupt countries.
- nearly two decades — The period over which the IMF has worked closely with national authorities, multilateral bodies, and the private sector to combat money laundering and the financing of terrorism.
- last year — The IMF adopted a comprehensive framework for enhanced engagement on governance (as referenced in the text).

### Impacts of hidden wealth and illicit activity
- Drains trillions of dollars from public coffers that could improve people’s lives.
- Reduces government revenues, weakening the capacity to boost growth in advanced economies, build infrastructure in emerging markets, and improve health and education in developing countries.
- Contributes to weakening of trust in government and undermines the ability to address key economic problems like inequality and poverty.
- Increases regulatory and enforcement challenges in the face of digital finance, crypto assets, cybercrime, and the dark web.

### IMF response and policy directions
- The IMF has worked to combat money laundering and the financing of terrorism, strengthen fiscal transparency, and confront corruption.
- Emphasis on governance: how countries define and implement economic policies and adhere to the rule of law.
- The IMF adopted a comprehensive framework for enhanced engagement on governance that encompasses functions most relevant to the economy, including:
  - tax collection,
  - central banking,
  - financial sector oversight and market regulation.
- Improving governance requires sustained, long-term effort and joint action among countries and institutions.

### Author perspective and conclusion
- The IMF cannot ensure a revival of international cooperation on its own but must prepare for the possibility that countries will rediscover the importance of cooperation; if they do, the Fund can be an invaluable instrument.
- Improving governance is framed as both morally right and practically beneficial, delivering tangible benefits to millions of people.

*Acting IMF Managing Director David Lipton, F&D Magazine – September 2019*

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## Content in this bundle

- **إجلاء الظلمة**
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  - [إجلاء الظلمة (PDF)](/-/media/files/publications/fandd/article/2019/september/ar/lipton.pdf){rel="external" type="application/pdf"}
- **The Dark Side of the Global Economy – IMF F&D**
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  - [启示之光 - 《金融与发展》2019年9月号·第56卷·第3期 - 国际货币基金组织季刊 (PDF)](/-/media/files/publications/fandd/article/2019/september/zh/dark-side-of-the-global-economy-lipton.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/fandd/issues/2019/09/dark-side-of-the-global-economy-lipton_