The Mo Ibrahim Foundation published, on June 19, 2024, its annual report entitled “Africa’s financial needs: where are the resources?”, in which it calls for drastic financing reform for Africa.
The report highlights the fact that in reality the resources exist, but are not implemented or used adequately, particularly when it comes to domestic resources.
The report reveals that the financial needs to achieve development and climate goals are staggering, with estimates of up to $1.3 trillion per year for some goals. Despite this, current funding, whether from Official Development Assistance (ODA), debt or domestic resources, is insufficient or misdirected.
For Mo Ibrahim, founder and president of the eponymous foundation, “There is an urgent need for a radical paradigm shift. It is neither a question of Africa holding out its begging bowl again, nor of its partners considering what additional amount they could still put on the table. The real issue is not yet more resources… but simply better adapted resources.”
The report begins by presenting the various estimates of existing needs, both in terms of development and climate, with regard to the African continent. Multiple, often divergent depending on the sources, constantly updated, all agree on at least one common conclusion: objectives far from being achieved, and dizzying needs.
Moreover, whatever the figures, it is essential to ensure that financing climate goals does not come at the expense of development goals, forcing African countries to choose between developing their own citizens and preserving the planet. The report then examines the financial contributions coming from the continent’s partners.
According to the report, Official Development Assistance (ODA) represents nearly 10% of the continent’s financial resources. But ODA from traditional donors remains concentrated on health and education, and largely conditional. At the same time, the commitment of non-member countries of the Development Assistance Committee (DAC) is increasing steadily, and is more in line with demand.
The document underlines that recourse to debt does not solve anything, on the contrary, since both the outstanding debt and the debt service have tripled since 2009, and the increasing complexity of its structure renders traditional treatment mechanisms ineffective. Also disabling are the assessment of African risk, the specific overloads of the IMF and the existence of “dormant funds” of aid.
The report calls for a radical change in the approach to financing Africa, with emphasis on optimising domestic resources, reviewing debt mechanisms, and more effective and transparent governance.
The Mo Ibrahim Foundation urges international partners to move from a logic of assistance to a true partnership based on the exchange of expertise and alignment with African priorities.
Founded in 2006, the Mo Ibrahim Foundation works to strengthen Africa’s voice in the face of global challenges, supporting initiatives to improve leadership and governance on the continent.
Rama Diallo
LeFaso.net
