The new global financing framework marks a clear departure from the business-as-usual approach that had governed financing for development issues. It broadens the scope of financing sources and channels, with an emphasis on domestic resource mobilization. Against this backdrop, the Action Agenda recognizes  domestic resource mobilization as the key channel for achieving sustainable development, and highlights specific actions to that end, including introducing progressive tax systems, improved tax policies and efficient tax collection mechanisms, administration and compliance; reducing subsidies; and curbing illicit financial flows, all of which have significant implications for the Arab region.
 
While illicit financial flows occur across many countries, their social and economic impact on the Arab region remains more severe, especially given the circumstances and challenges currently facing the region. including protracted conflicts and almost 60 years of Israeli occupation of Palestinian and other Arab land.

Illicit financial flows are adding to the aforementioned challenges, causing severe indirect drainage of foreign exchange reserves, eroding tax-bases and weakening investment. Illicit financial flows undermine the rule of law, stifle trade and worsen macroeconomic conditions, facilitated in part by international tax havens. It is in this context that illicit financial flows out of the Arab region are becoming a growing concern, and must be curbed.
 
To this end, this panel aims to support member States’ efforts in implementing their commitments under the Action Agenda to eliminate illicit financial flows by 2030. More specifically, the panel builds a foundation for developing a regional road map to tackle illicit financial flows and trade misinvoicing at the regional level, given that illicit financial flows require national and regional collaborative efforts.