Magazine article African Business

The Emperor's New Clothes

Magazine article African Business

The Emperor's New Clothes

Article excerpt

Following the Goldenberg debacle, more fraud has been revealed by the European Commission. But with a miraculous boom in Kenyan gold exports in 1994, what other dirty washing does Kenya have out to dry? Francois Misser reports from Brussels.

According to the European Commission's annual report on fraud in 1994, the Kenyan authorities have been urged to invest/gate local garment producers to find out whether false export certificates are still being issued.

The European Commission has strong suspicions that the practice continues apace, with the Commission's investigations showing 200 false certificates for the export of T-shirts issued in 1994. Although the T-shirts were exported under the preferential Lome rules of origin, many were actually made in the United Arab Emirates (UAE), and never even crossed Kenya's borders.

The fraud has so far deprived European treasuries of a minimum ECU2m (about $2.5m), consisting in unpaid customs duties, the report says. The EU countries concerned are Germany, Belgium, France, the Netherlands and the UK.

The first to react was the Dutch Government which undertook procedures to recover some $1.1m. A clutch importer was even sentenced to one year's imprisonment. But the European Commission is convinced that the real loss could be far higher than previously estimated.

But an even more disturbing twist to Kenya's miracle export drive, has been uncovered with the release of the Belgian Foreign Trade Office statistics for 1994.

Kenya does not mine gold or diamonds. Yet the country managed to export $13m worth of precious stones and metals. …

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