Two billion of the institution’s investments in poor countries through companies registered in tax havens. In all Norfund had invested 9.6 billion by the end of 2013.
institution is the state company for business investment in poor countries.
In a new report written by the organization European Network on Debt and Development (Eurodad) says that 46 of Norfund 165 investments in poor countries through tax havens. This is also shown in tables in Norfund annual report for 2013.
– Justifying secrecy
– The institution has even pointed to the use of tax havens as detrimental to the development of poor countries. By institution itself invests through funds in tax havens, they help to legitimize secrecy. It is therefore not consistent between goals and practices in institution, says Secretary General Mona Thowsen in the Norwegian part of the organization Publish What You Pay.
Adm. Director Kjell Roland institution is amazed that organizations have spent much time and money to finish what he calls “a crusade” against public financing institutions that institution.
– This is characterized by suspicion and innuendo, but little facts. The campaign they lead is more harmful than helpful for poor countries because it is primarily directed at those who have a mandate to invest for development, he said.
Mauritius and the Caribbean
Largely secrecy is an important characteristic of tax havens. The organization Tax Justice Network has developed a benchmark that tries to measure and rank the various tax havens. Eurodad based on this measure in its report.
The scale is called the Financial Secrecy Index. Countries are evaluated by 15 indicators for secrecy. The figures show:
22 of the 46 investment institution carries through tax havens occurs via archipelago Mauritius in the Indian Ocean. Measured by the degree of secrecy is only eight of 82 countries that provide less insight than Mauritius. Four to seven investment goes through the US state of Delaware and the countries of Panama, the Cayman Islands and Luxembourg. These are somewhat more open than Mauritius, but much more closed than for example the Nordic countries.
Further to poor countries
Assistance funds are first invested in companies and funds that belong in tax havens . These invest money ahead in Africa, Asia and Latin America.
Thowsen in Publish What You Pay in Norway works to keep money away from tax havens.
– What economic reasons Norfund to invest via countries with a high degree of secrecy? she asks.
– It may well be necessary to use these countries to invest with other similar funds, and that Norwegian state enterprise must the institution be open about everything?
– This is about developing countries lose billions each year because of tax evasion through tax havens. It seems counterproductive when institutions to promote development using schemes that hinder development, she said.
– Reduce the risk
Roland Norfund answer Thowsen questions.
– For us this is about reducing risk. In many African countries the judicial system unpredictable and next impenetrable. The risk on the ground is always there, but by going through third countries can risk in relation to our local and international co-investors moved to countries with good legal systems. It makes it possible to pursue violations of agreements on the standards to be followed at work and in local communities.
– What makes Mauritius better than any other country you could invested through?
– Mauritius has for many years been the gate into the eastern and southern Africa for investors. The country uses the English legal system. Without going through a third country that Mauritius could we not made investments with equity in the least developed countries.
– What signal do you send out by 46 of the investments done through tax havens?
– We strive to avoid using such third nor organize ourselves so close investment as possible. Greater transparency in international finance is important. We can only cheer on OECD and others who contribute to international agreements that create greater transparency. But we must have the same rules as other Norwegian investors we will succeed as a minority investor, says Roland.
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