African Ministers Call for New Financing for Continent’s Development Agenda
Kigali, MINA – African ministers and officials of the African Union called for new sources of financing on Monday to supplement member states’ contributions towards the continent’s long-term development activities, Anadolu Agency reported.
They spoke at discussions on financing of the African Union’s Agenda 2063 and its flagship projects during a retreat of the African Union Executive Council in Rwanda’s capital Kigali.
The three-day ministerial retreat was convened to discuss the second 10-year plan of Agenda 2063 spanning from 2024 to 2033.
“In order to achieve the progress we want, we must ensure we have the resources necessary to implement the programs of our agenda. The matters of resource mobilization and effective deployment of resources are key,” said Naledi Pandor, South Africa’s international relations and cooperation minister.
Noting that financing has proven to be challenging, Pandor called for an effective domestic resource mobilization strategy and better utilization of the private sector, since it holds massive capital.
“We should attempt as members of the African Union to fund the operational budget of the Union fully and progressively move toward attaining 75% for the program budget and 25% on peace support operations,” she said.
The key barriers to financing of the continental agenda in the first 10 years of implementation highlighted include illicit financial flows, high debt levels and inefficiency of tax administrations to collect adequate revenue resources, according to officials.
“The high cost of debt servicing is a negative for the continent, and we need to look at ways of reducing the high levels of debt,” said Pandor.
In 2015, the International Monetary Fund (IMF) indicated that eight countries in sub-Saharan Africa were in debt distress or at high risk of debt before Zambia defaulted in 2020.
The IMF list has since grown to 23 countries. African governments owe money to rich countries and multilateral banks and bondholders.
“We believe that implementing Agenda 2063 requires us to set up an effective financing framework which must ensure predictability of resources and effective public partnerships with the private sector,” Pandor said.
Albert Muchanga, the African Union’s commissioner for economic development, said one of the key elements to increase domestic financing is to promote rapid economic growth by coming up with key actions to achieve inclusive economic growth and cutting wasteful tax incentives.
Africa loses $88.6 billion in illicit financial flows annually equivalent to 3.7% of the continent’s gross domestic product, according to the 2020 report of the UN Conference on Trade and Development (UNCTAD).
The Africa Union’s Agenda 2063 was adopted by the African Union Assembly in 2015.
The agenda envisages a continent where every nation will have attained middle-income status, be more integrated and connected, able to resolve conflicts amicably and with more empowered and productive citizens as well as a strong Africa acting as an influential global player. (T/R3/RE1)
Mi’raj News Agency (MINA)
