The African Union has called on African countries to increase their contributions to the union in order to reduce reliance on external funding.

The AU Commissioner for Economic Affairs, Anthony Mothae Maruping, told The New Times, yesterday, that by increasing contributions to the body, countries would also impact on their decision-making process.

Mothae, who was speaking on the sidelines of the ongoing 27th African Union Summit in Kigali, said they were optimistic on the future increase of contributions as well as alternative sources of funding.

“Looking at the determination by the Heads of State and Government, we will move from reliance on external funding. We are calling on Heads of State and Government to roll up their sleeves and come together to address the issue. But it will be a gradual process,” Mothae said.

During the opening of the Summit last weekend, Dr Nkosazana Dlamini-Zuma, the AU Commission chairperson, also addressed the concern, saying reliance on foreign funding to the commission could hamper its ability to focus on continental priorities.

Statisticians from Southern African Legal Information Institute (SAFLII), say of the $416.9-million budget for the African Union adopted for 2016, only about $170 million was secured from member states, with the rest coming from international partners.

The contribution from each of the 54 AU member states is calculated in terms of percentage of total budget.

Attracting investments

Dr Carlos Lopes, the executive secretary of United Nations Economic Commission for Africa, said the quest to reduce dependence on international partners can be achieved by concentrating on attracting investments, capitalising on foreign remittances as well as reviewing the tax regimes of African countries.

“We can do this by making sure that our tax systems are more updated to ensure that taxes paid correspond economies. Taxes in Africa are the lowest in the world and there is potential to do more,” he said in a separate interview.

“You also have to have progressive taxation or else you will end up overtaxing the poor. You should tax those who have more, like multinational firms that are often tax-exempt.”

Alternative funding

Lopes suggested other ways of funding African Union initiatives and projects could be through working closely with banks across the continent.

“You also have issues of how to deal with the banking sector because banks do not want to take risks. But if African banks cannot invest in Africa, who will?” he posed.

He pointed out there is a lot of potential across the continent given the performance of many big economies as well as the continent’s gross domestic potential.

“The 400 biggest corporations in Africa are actually growing faster than their peers outside the continent. We expect them to increase economic activity, thus increase revenues and funds across the continent,” he said.

Other sources of funding suggested include pension funds, if well managed.

He added that the foreign sources of funding had no doubt affected prioritisation.

On whether foreign funding had an impact on decisions and priorities, Mothae said it was a matter of opinion.

“The main thing is to have sufficient contributions to be in charge of our decisions and choices. We want to make sure that they play by our tune,” he said.

“It doesn’t mean that it will turn away contributions or chances of partnership with international partners and agencies.”

The ongoing summit which opened Sunday, is being held under the theme “Year of Human Rights with particular Focus on the Rights of Women.”