Boosting Domestic Resource Mobilization to Finance African Transformation
DATE: Wednesday 24 May 2017
TIME: 15:00 – 17:00
- Mr. Charles Boamah, Senior Vice-President, AfDB
- Hon. Amadou Ba, AfDB Governor for Senegal
- Hon. Ambassador Claver Gatete, AfDB Governor for Rwanda
- Hon. Sfiso Buthelezi, Deputy Minister of Finance and AfDB Temporary Governor for South Africa
- Hon. Sahar Nasr, Minister for Investment and International Cooperation, Egypt
- Hon. Dieudonné Evou Mekou, Deputy Governor of Central Bank of Central African States
- Alan Kasujja, BBC
As African countries pursue ambitious development programs, greater commitment for mobilization of domestic resources becomes imperative. It is neither sustainable nor desirable for African economies to fund their development needs predominantly from external sources. Thus, increasing the share of domestic resources committed to development programs assures ownership of home-grown solutions and accountability of governments to the citizens. Yet, domestic financing for development programs is constrained by persistently low rates of domestic savings. The experience of Asian countries demonstrates that domestic savings of up to 30% of GDP were necessary during the early stages of their development. Although Africa’s share of taxes in GDP has increased to around 17.2%, slightly higher than the world average (15%), this is still inadequate to meet the competing needs of delivering basic social services. In Africa, coupled with low savings and tax rates, public spending is also plagued by inefficiency.
The Senior Vice-President of the AfDB will be joined by AfDB Governors and Central Bank Governors from the regional member countries to reflect on how to enhance the size and efficiency of domestically mobilized resources. It will discuss methods of tackling the usual causes of low domestic resource mobilization including weak institutions for tax administration, a narrow tax base, informality, as well as various factors that lead to tax evasion. This panel will also discuss the financial regulatory reforms necessary to tap the savings of African institutional investors (including pension funds and sovereign wealth funds) to fund development programs. To allow for interactive discussions, this event will follow a town hall (amphitheatre) setting. The sitting arrangements will enable Central Bank Governors to engage with the panel.